Personal Finance

Employee Stock Options and share price change

  • Last Updated:
  • Feb 12th, 2018 8:08 pm
[OP]
Newbie
Nov 20, 2016
49 posts
7 upvotes

Employee Stock Options and share price change

Hi all,

This is perhaps more of an employment/corporate finance question than an investing one...

Some time ago I received stock options as a benefit from the company I work for. The options would vest in portions over a period of a number of years. Share exercise price was set at $X/share, which was its market value (this is a publicly traded company) at the time of presenting me with the stock options.

Now, a few years later the share price has gone down considerably - it's currently at ~25% (one quarter) of the original X value.

I wonder if this is at all an option to go the employer and see if the price on my options contract can be renegotiated. Is it even possible/common/good will from employer/frowned upon? Or was it just a lottery ticket that never materialised, and that I should just write off? There was a significant $ value of options issued to me at the time.
4 replies
Sr. Member
Oct 14, 2012
699 posts
437 upvotes
Woodstock
If they aren't expiring immediately so you can wait for the price to rise above your options price, wait it out. Otherwise yes, you lost. The theory is the employees getting the options were supposed to become so super-motivated that the stock price would go up. The reality is that many companies stock prices are at the mercy of factors beyond the employees control like the price of oil or a change in the public's interest in a technology or product.

We've felt your pain too....we call RSUs, options etc "phantom money" because it may never materialize.
Deal Addict
Dec 23, 2010
1897 posts
929 upvotes
Moon
CraigRFD wrote: Hi all,

This is perhaps more of an employment/corporate finance question than an investing one...

Some time ago I received stock options as a benefit from the company I work for. The options would vest in portions over a period of a number of years. Share exercise price was set at $X/share, which was its market value (this is a publicly traded company) at the time of presenting me with the stock options.

Now, a few years later the share price has gone down considerably - it's currently at ~25% (one quarter) of the original X value.

I wonder if this is at all an option to go the employer and see if the price on my options contract can be renegotiated. Is it even possible/common/good will from employer/frowned upon? Or was it just a lottery ticket that never materialised, and that I should just write off? There was a significant $ value of options issued to me at the time.
If you were given options as a benefit and these options never materialized I don't think you can claim any losses because you never received any money and your money was never at risk.
[OP]
Newbie
Nov 20, 2016
49 posts
7 upvotes
Applesmack wrote: I don't think you can claim any losses because you never received any money and your money was never at risk.
I meant "write off" mentally, not for tax purposes.
Deal Fanatic
User avatar
Jan 6, 2002
5968 posts
6186 upvotes
Toronto
Depending on how they were granted to you, if you cash them in you might owe taxes at marginal rate on the original value of the stock at the time it was granted. So for this reason you might want to let them site forever.
As someone long prepared for the occasion, in full command of every plan you wrecked---
Do not choose a coward's explanation, that hides behind the cause and the effect...

Top