When granted equity compensation, there’s usually a period of time that must elapse prior to the value becoming yours (for restricted stock units) or you having the right to exercise them (for stock options). Once you meet the requisite timeline, you are considered vested. Terms vary, but vesting typically occurs in stages. For example, 25% of your shares may vest after a year has passed, with additional amounts vesting monthly over the next several years. As your options vest, you can then exercise those shares if you wish, and purchase company stock. If you leave the company, you are likely to lose unvested shares; you may have a window of time during which you can exercise vested shares, after which you can no longer do so as a former employee.

Don't Miss A Thing!

Sign up today for free and be the first to get notified on all things equity compensation, incentive stock options, non qualified stock options, restricted stocks, and more!

You have Successfully Subscribed!

Download your Free EBook

Sign up now to receive your FREE copy of "The Ultimate Guide to Incentive Stock Options".

You have Successfully Subscribed!