Questions tagged [employee-stock-options]

ownership of company given to employee, generally in start-ups instead of giving cash rewards. Also used by listed organisations as a mechanism for employee retentionship

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Stock option impact when a company splits into two companies

What happens to an unvested stock option held in a company, that then splits into two new companies - are the options replicated?
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Should I exercise my stock options (NSO's) before or after moving from Canada to U.S.?

I'm planning on changing my residency in a coming year from Canada to U.S. (Canadian citizen). I have NSO's of a private US corporation and have the option to exercise my vested options. I'm going to ...
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Does California double-tax the portion of incentive stock options which are subject to AMT?

Consider the following scenario: In 2020, Alice vests and exercises ISOs at $1 strike price, $3 FMV. Under California AMT, she generates $2/share of gain. Alice exercises enough shares to owe a ...
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When my stock options fully vest, is that the equivalent of a pay cut?

Background I am approaching the end of my vesting term of 4 years. The vesting plan follows a typical 4 year term, with 1/48th of the total options vesting every month (after the initial year-long ...
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German employee with stock options for a NASDAQ-listed company: eligible for Tax Treaty Benefits?

I am a German employee (German citizenship, living and working in Germany, no connections to the US) of a NASDAQ-listed company and have received stock options (more exactly RSUs, Restricted Stock ...
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Is there a future tax benefit to selling RSUs in order to exercise-and-hold the stock options?

I have RSUs and in-the-money stock options granted by my company, both vested. I've held the RSUs for over a year, so I understand that when selling, I would pay long-term capital gains tax on the ...
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'iss' function in "FinCal" package in 'R'

Following is the 'iss' function in "FinCal" package in 'R'. iss: calculate the net increase in common shares from the potential exercise of stock options or warrants. Description: calculate ...
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Why would someone argue that stock options are a better form of compensation?

I'm reading How Google Works by Jonathan Rosenberg & Eric Schmidt. In the Talent - Hiring is the most important thing you do chapter, the authors briefly pause the management topics to give career ...
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European citizen exercising USA company stock options

My situation is pretty simple, I am a European citizen working for a US based company. I would like to exercise my vested stock options and hold the stock long term since both the exercise price and ...
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Exercising options and holding on the stock

I have a certain amount of stock options (NSO) that I can acquire at the startup I work for. For personal reasons, I will have to eventually leave the company. I do believe in the company, and the ...
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If you are doing an 83(b) early exercise, would there be any tax difference between incentive stock options and non-qualified stock options?

Let's say one is being given employee stock options with a relatively low exercise price, such that it makes sense to do an 83(b) early exercise. In that case, would it matter if they are incentive ...
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QSBS for restricted stock options

The below applies to a US company I have started at a company where I have received stock that has a 1 year cliff and a 4 year vesting schedule. I earlier exercised my stock and filled out a 83b form. ...
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Is there any reason to exercise company stock options with no listed value?

I have vested options that are relatively cheap to buy, but there is no indication that there is a traded underlying security and there is no value listed anywhere on Carta. Since the exercise price ...
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Will stock options continue to vest if an employee goes into State Disability Insurance (SDI)?

If an employee in a publicly traded company needs to go on SDI (to get treatment) will the employee continue to vest options (ISOs, RSUs)? Is SDI like a sabbatical from a company's perspective where ...
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Salary after all restricted stock units have been vested

I am a German and got a job offer from a US company. This is the first time a company offers me a salary and restricted stock units (RSU). German companies usually do not grant RSU for non-senior ...
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What financial due diligence should I do when joining a tech startup?

A large portion of compensation from startups is in the form of equity or stock options (often at the cost of lower salary). It's also not good on your resume (at least early on in your career) to be ...
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Can I make use of my wife's Capital Gains Tax Allowance for gains under an EMI Share Option scheme?

My employer has granted me a number of share options under an EMI scheme. They also partnered with their brokers to allow us to exercise these options without needing to put up-front capital in to ...
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Can a company not pay out on ESPP enrollment?

My girlfriend enrolled in her company’s ESPP program beginning Jan 1, 2021. They have been withholding 10% of her gross pay as expected. Now that the July 1 payout has arrived with nothing seen by her ...
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What does this statement mean in my ESOP?

I am in senior marketing position at my startup and I have been recently granted ESOP. My contract has this written in it: 55,000 options (Shareholder Interests, Options), which represents an ...
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Start-up Valuation with employee option pool

I am reading Venture Deals 4th edition and I came across the following statement in a chapter on economic terms of the deal: Consider $5 million investment at $20 million pre-money valuation. Assume ...
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If I already had taxes withheld, will I get a refund for investing in a Qualified Opportunity Zone (QOZ)?

When I sell any NSO or ISO (long and short term mixed) there are taxes withheld by the company/brokerage. In my understanding, investing in Qualified Opportunity Zones for a long term has benefits in ...
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Valuing employee bonus stock options in a startup

Oftentimes, a prospective new employee for a start-up is offered stock options as a significant part of their sign-on bonus, if not the entire bonus. When given an offer, say, of an option for 20,000 ...
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Roth IRA and pre-IPO shares

With the recent news that a billionaire managed to get several billion dollars in a Roth IRA by funding it from pre-IPO shares of his company, I'm curious about how this works. Ignore for the moment ...
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Company just got acquired. What does this mean for my common stock?

I own 200 common shares of a private company I worked for up until about 3 years ago. Today, I read in the news that they were acquired for a LOT of money but I don't know yet what the current stock ...
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Having Stock Options Without Knowing Total 409a Valuation

I have just received some of my first stock options in a company. The paperwork states the FMV of stock, my exercise price, and the total number of shares reserved for employee options. However, I ...
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AMT and Child Tax Credit

I'm trying to figure out at what point AMT might hurt me, because I just received from stock options from my employer and am considering the benefit of exercising. I worked through form 6251, but I ...
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Employee stock options: why is the total number of shares a secret?

I know someone close to me who has been offered employee stock options (which they are supposed to buy later at a fixed price, potentially, when/if the business goes to IPO or something) and they ...
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3 votes
3 answers
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Should I exercise my options to buy stock in a company not yet trading publicly?

I used to work for a start up that offered stock options which I haven't been able to afford to exercise until now. I'm very new to stocks so I'm not 100% sure how it works. Currently, I'm able to ...
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1 vote
2 answers
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Assessing the value of stock options without the strike price or cap table

I recently received a job offer that offers me a certain number of stock options, but when I asked for the strike price or cap table they said that they cannot share that information with me. Instead ...
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2 answers
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Share Options Vs Salary

In my current role my base salary is well below market value for my experience and responsibility. Ive also been awarded some share options and pay in to a share save scheme at the same time. I have ...
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5 votes
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Can a company cancel vested employee stock options on acquisition?

My company stock option plan contains the following language: In the event that the company is subject to an Acquisition, outstanding awards acquired under the plan shall be subject to the agreement ...
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3 answers
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Sticky Situation in Negotiation - Should I walk away from contract if I already did the job?

I am in a very sticky situation, I agreed with a customer I'd do a job that takes 1.5 months for 25k$. The customer sells my job artifacts to a very reputable client and adding that client to my ...
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2 votes
1 answer
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Taxes on stock options for non-resident aliens

I have ISO stock options as part of my employment in California, USA. In the middle of 2019 I had to leave the USA for family reasons. In 2020 I wasn’t in the US (became non-resident alien for tax ...
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"Price per option granted" versus "exercising price"?

What is the difference between "price per option granted" and "exercise price" ? Let's say I received 10 employee stock options with a "price per option granted" = 0 Euro ...
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What to ask for to determine percent of startup I have shares in?

I work at a pre-launch tech startup and we agreed that I'd receive 2% equity. When I signed paperwork for the shares, there was nothing indicating what % I signed at, just the number of shares. I ...
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2 votes
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How to think about an options tender offer?

In my previous job I got stock options, even though the company was still private. When I left the job, I paid the company ~$12k to buy these "unborn" stocks (excerzise the options?). Now ...
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What are the differences between IPO and Direct Listing, esp for employees?

If a pre-IPO company is evaluating whether they should go IPO or Direct Listing, how would either option affect employees? Let's say the employees have some combination of NSO, ISO, RSU. IPO may be a ...
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If I have a fixed amount to invest, should I exercise and hold NSOs or ISOs of my company?

I am trying to play some scenarios to compare opportunity costs and hopefully decide on which route, to maximize my gains (after all taxations). I formulated a spreadsheet to help me calculate a few ...
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Can timing the exercise of stock options based on material non-public information be considered insider trading?

Suppose I strongly expect, based on material non-public information, that a public United States company in which I hold incentive stock options (as a current or former employee) will see an increase ...
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2 votes
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US tax implications for UK EMI (Enterprise Management Incentives)

I am a dual US/UK citizen, permanently resident in the UK. I have a job offer which includes EMI (Enterprise Management Incentives), also known as share options. As a US citizen, I have to file a US ...
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2 votes
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AMT ISO deferrals for nonimmigrant. Sold shares after leaving US

I lived in the US from 2013 and 2016 on an E-3 nonimmigrant visa. As part of my full-time employment contract, I was granted ISO shares in a pre-IPO company. I exercised most of the vested shares in ...
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Non-qualified stock options tax optimization strategy

I'm trying to understand the best strategy for reducing tax liability with non-qualified stock options. Assuming the stock price will only ever increase Exercise all newly vested options as soon as ...
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1 answer
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Can Directors issue themselves shares during raise?

I was wondering if it is legal for company directors that also work and operate the business to gift themselves shares during a capital raise in order to retain their controlling interest in the ...
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1 answer
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Where are RSUs issued from?

Beginner here. Let us say, I join some company X. They offer me 400 stocks over 4 years of vesting period. Similar to me, there will be hundreds of employees who will be joining everyday. Doing a ...
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How to distinguish insider purchases from stock option exercises?

I've read that large insider stock purchases are considered a good confidence signal for its near future. But, as I understand, the SEC reports about insider purchases may also include stock option ...
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1 answer
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US Tax implications? Bought stock options, paid AMT, company acquired at a loss, options worthless

Scenario (numbers are for illustrative purposes only): 2017: I exercised options when I left my former employer (startup, not public). Exercised 100% of 10,000 ISOs, common stock. At a strike price of ...
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Why are stock options named as they are?

Why are ISO stock options termed "statutory"? Because they are defined by some sort of statute? If so, then what is the statute? Similarly, why are ISOs termed "incentive" stock options whereas NQOs ...
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If employees exercise options that they are given by the company, will that increase the number of outstanding shares?

Question is simple If employees exercise options that they are given by the company, will that increase the number of outstanding shares? If yes why and if no why.
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2 votes
1 answer
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Are there risks to having money in an ESPP if the company fails before the purchase date?

I work for a company that offers an ESPP. Employees can put money toward the plan throughout the first half of the year, and it is converted to stock at a 15% discount at the end of Q2. Stock can be ...
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56 votes
5 answers
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How can I sell my shares in a privately-owned company I used to be employed by?

Basically, I was a software developer at a company and I was issued some stock options early on, before the company grew significantly. The company then hired a CEO who pledged to take the company ...
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