Hmm actually I might not be right on the mechanics there; you repurchase an exercised option but cancel the unexercised one, and plausibly your contractual language in the grant automatically cancels them based on reference events like end of service. (Lawyer it up folks.)
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Is it really that easy? Because if so a lot of CEOs have a lot of explaining to do about how impossible they said it was to extend windows...
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We are learning a lot about exactly what is impossible and what is not.
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Repurchases would be for a restricted stock grant (e.g. founder shares), but in that case, yes. Option expirations, however, happen automatically unless changed and may require a board resolution to override stock option plan rules. (IANAL)
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No, not as easy. 90-days is an IRS rule for Incentive Stock Options (ISO). The options need to convert to Non-Qualifying Stock Options (NQSO). ISOs are not repurchased, they expire.
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When I say a startup whose options have a 7 year exercise period are those always NQSOs?
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Yes for rank and file up to mid-execs; no for departing cofounders and C-suite (>>1% holders). At that level, that equity needs to be redeployed to new talent/capital for the company's good, and individuals should have resources.
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