Employee Stock Options - Advice Please

[Drew411]

I have a load of employee stock options in an Australian company which have now vested.

With the current SP they are in the black at a decent strike price.

Due to my current financial situation I'm unable to cover the purchase price of the options.

I'm looking at various options I have to sell these as they expire in about 6 weeks so want to move on them now.

I've been living overseas in the UK for a number of years so I'm unsure how tax works.

Any advice would be appreciated.

 

[burglar]

... Any advice would be appreciated.

I take it that 'vested' means you have ownership.
Are they listed as something saleable?

If not, borrow against their value to exercise them!
Then you could sell part to repay the loan.
Else, you could sell out and go on a holiday.


I too, am unsure how the tax works.

 

[Drew411]

I take it that 'vested' means you have ownership.
Are they listed as something saleable?

If not, borrow against their value to exercise them!
Then you could sell part to repay the loan.

I have the right exercise the options, apparently the process can apparently take about 4 to 5 days.

Is there anyway to mitigate the risk during that period as its a substantial amount (to me), or is the only option available what they refer to as a cashless exercise i.e. buying on margin?

Thanks,

 

[skc]

I have the right exercise the options, apparently the process can apparently take about 4 to 5 days.

Is there anyway to mitigate the risk during that period as its a substantial amount (to me), or is the only option available what they refer to as a cashless exercise i.e. buying on margin?

Thanks,

What risk are you referring to?

If you are talking market risk of the share price tanking between you choose to exercise and being able to sell your shares, then you could potentially look at shorting the shares at current prices. To do that you will need a broker who let you short, and you will need to pay up margin on such position. You obviously forego any upside if the share price goes up.

Note that not every stock on the ASX is available for shorting.

 

[burglar]

I have the right exercise the options, apparently the process can apparently take about 4 to 5 days.

Is there anyway to mitigate the risk during that period as its a substantial amount (to me), or is the only option available what they refer to as a cashless exercise i.e. buying on margin?

Thanks,

Have you spoken to the company? ( ...buyback?)

Or your Broker?

Keep it simple ... if you can!