Options Trading Tutorial

Cashing in Employee Stock Options?

I worked for a company back in 2000 that had an IPO. Employees were awarded stock options, and I was awarded 2,000 shares. I still have the letter from the then president and CEO. I ended up leaving the company a few months later, so it appears as if I'm only 25% vested. The company, as it was, no longer exists. It was split into 2 separate companies. What value, if any, would the stock options have today, and could I cash out my vested portion?

Public Comments

1. Go see an investment professinal. You could also try to call the HR departments of both companies to see what they say about the options. It is always best to keep track of these things more frequently as now you are going to have to do some work to see if you can get this money.
2. You would have 25% of the original contract for 2000 share. There are a few things that you need to look into with options. First would be how long the contracts were? The contracts are usually 25 years, but I have seen 5-10 year IPO contracts. Next would be what company took over the stock. If they broke off the two companies, who took over the shares? And, who ever took over the shares, did they convert the option contracts? Sometimes, ESOP (Employee Stock Option Plan) will not have the options converted if the company is broken up. If the company did not give you “options” but just 2000 shares, you would just need to know what the shares converted into. Most companies only give “option” contracts to executives, because they are not “actually” holding onto the stock. Also, most “option” plans do not have a vesting. The ESOP (Employee Stock OWNERSHIP Plan) will have a vesting. I would call the company that holds the stock, and find out what you can do. If the company split in 2000, it will probably take a long time to find out information. Companies only need to keep records in the front office for 3 to 5 years (depending on what type of record), so they will have to find the information, and they could take a lot of time. Best of luck