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My company repriced my options. What should I do?

repriced options

repriced options

New York - If the price of your option was repriced lower than the original price that you had to purchase them, you should be happy.

Repricing stock options occur when the stock underlying the option has fallen significantly below the value of the original purchase price. Companies reprice the option to the current price so as to continue to provide a future incentive for employees.

If the price of your option was repriced higher, you need to review the original option agreement that you signed to see if the company was legally and contractually allowed to do so. Although it is uncommon, some employers retain the right to change the future purchase price based on pre-defined terms.

Many companies also have clauses in options packages that require departing employees to give up their options, or repay some of the profits they earned, if they leave under various conditions. For example, if any employee terminates their job and takes a job with a competitor, some companies will require paybacks of earnings; in effect, the stock option package is undone.


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