This is an interesting little question for anyone interested in Employee Share Options Schemes etc.
I have share options with a former employer who is discussing buying back the options from me at the moment. The weird thing is, the whole options plan expires in a few months, so Iím trying to work out what possible benefit there is for my former employer in buying back the options now.
So a few more specific questions are:
ē Generally, what happens to options when an options plan expires? Do they get reabsorbed into the company? (ie if there are 1,000,000 shares, 100,000 of which are allocated to the share options scheme, does the company just go back to being 900,000 shares?
ē When the plan expires, do my options simply expire from my perspective? (I know it may be hard to answer this without looking at all the documentation, but Iím interested in what normally happens)
ē If the share options expire so soon, why would my former employer be trying to buy them off of me? What possible benefit might they gain from buying them rather than waiting for the plan to expire? Might there be a reason that they want to get rid of the plans and other options holders urgently? eg if there is someone trying to buy the company? Or another thought, maybe they might be thinking of extending the expiry date of the scheme and offering the options to someone else instead, so they would like them back? If thatís the case, why would they not let the scheme expire and start a new one?
I know these questions probably do not have definitive answers, but I would love someone else's input on this.