I just lost over 2000 stock options !!

[ggavinmoss]

Sucks, but move on, there's nothing you can do about it.

-geoff

 

[flot]

To reiterate what others are saying, this 3 month period was most likely part of your options *grant* not part of your severance package.

Also I'm still curious what the current stock price of your company is.

On top of that, if you only worked for the company from may 01 to june 03, did you actually *vest* 2000 stock options? Or were you just given that many? Most options have a 3-5 year vest period.

You certainly cannot claim any kind of a loss, as you haven't lost anything.

 

[pyonir]

I got 100 shares here. had to wait until it 'matured' based on my start date, and it split in the meantime. Now have 150 and regardless if i work here or not, they are available until 2010.

 

[Epiphany]

i don't get it. so why don't you just buy the stock on the open market right now and since you seem so sure it is going past your option price you're already "in the money" if you buy now.

 

[mpitts]

I had 12,000 stock options with my last employer. I worked there five years.

They gave me 30 days to front the cash to purchase them or I lost them.

 

[BCYL]

Originally posted by: polm
well...that's that..


HR just called me back and informed me that the contract explicitly grants a 3 month window to excercise the options or lose them

AARGH !

3 months sounds fair... I think my company's policy on this type of situation is also 3 months too...

 

[Michael]

The normal period to exercise options when you leave is between 30 days and 3 months. It depends on the plan.

Even if an option vests, you typically have a set period of time to cash them in if you leave.

You didn't "lose" anything. You were let go and the options were worthless during the period in which you could have exercised them.

Michael

 

[crystal]

If you "know" the stocks are going up, why don't you brought it right now like any normal investors? The price right now is lower than your grant price so it is a win/win for you as you could brought more stock than that 2000 stocks for the same price.

Now do you understand why you didn't lose anything.

 

[Hector13]

Originally posted by: orangel
they should've told you when you left.
however, it really won't make a difference to you.
as you point out, it's currently lower than your grant price, by exercising, it means you have to cough up the money to buy those 2000 shares at your grant price.
you'll be losing your money already.
3 months is a long time, i heard some companies are doing 2 or even just 1.
it's not a pre-ipo company so you really aren't missing much.

I don't know if you guys are aware of how options are priced, but just because his strike price was bellow the current market price does not mean the options are worthless.

In fact, I would dare to guess that your options were worth probably $4-5 each. The biggest part of a long-term option's price is its "time value" (ie, from now till the option expires, given the level of volatility in the particular stock, there is plenty of chance for that stock to go above the stike price). In your case, you had 10 year options! Those are super long-term.

The only problem would have been selling the options as options that far out don't usually trade. If you check yahoo or somewhere, you will find options that typically expire in under a year. THeir are longer term options out there (called LEAPS), but even those are generally only a few years in out.

You could still have written (sold) the farhtest out LEAP you could find at or above your strike price and made good money (you would, in escense, be writting a covered call option).

 

[Hector13]

Originally posted by: crystal
Now do you understand why you didn't lose anything.

read my post above.. not only did he lose something.. he may have lost 6-7k or more. If you google, I am sure you can find "option pricers" out there.. a 10 year option would have been worth a lot of money.

 

[flot]

Hector, pretty sure you're off the mark here. Employee stock options are different from exchange options. AFAIK, employee stock options have absolutely no value when they are under water.

 

[MustISO]

Employee stock options have no value at all until they're exercised. If you never excercised the options you haven't lost any money/value.

 

[Hector13]

Originally posted by: flot
Hector, pretty sure you're off the mark here. Employee stock options are different from exchange options. AFAIK, employee stock options have absolutely no value when they are under water.

my point wasn't that they can be sold on the market.. you are right, they can't. But they still have value and you can still write "covered options" against them (covered in an economic sense, not in a legal sense).

 

[SuperTool]

Oh no, you lost some underwater options. Want some of mine?

 

[CPA]

Originally posted by: polm
This is probably a stupid question, but ....

Is it possible to claim the expired options as a "loss" of some sort on my Tax return ?

uh, NO!

I'm surprised your company did not reinstate the options. My company considers you a continuing employee if you are rehired within a year.

 

[Hector13]

Originally posted by: Hector13

Originally posted by: flot
Hector, pretty sure you're off the mark here. Employee stock options are different from exchange options. AFAIK, employee stock options have absolutely no value when they are under water.

my point wasn't that they can be sold on the market.. you are right, they can't. But they still have value and you can still write "covered options" against them (covered in an economic sense, not in a legal sense).

here is an example of the theoretic value of a 10 year option with a stike of 11 using a volatility of 40% (this is about what the implied vol on AWE was last year): link

The theoritic price is about 5 bucks (for a call option). At a $12 strike, the options are worth $4.78, at a $13 strike, the would be worth $4.5. Obviously, these is a "theoretic" value, but trading prices tend to be very close to the theoretic value. Also, you have to make some assumptions about things like interest rates now and in the future (I assumed 3%), volatility (40%), and dividends (I assumed none). In any case, this would estimate that you lost around 8-10k.

Checking the cboe here, a jan 06 call option with a strike of $10 is quoted at $2.20. An option with a strike of $12.50 is quoted at $1. Unfortunately, these are the farthest out LEAPS I see on their website, but you can perhaps buy/sell longer time ones over-the-counter.