Paper value of a grant.
A worked example
Starting figures
- Options granted
- 8,000
- Strike price
- $4.50
- Current share price
- $12
- Vested
- 50%
- Tax on exercise
- 35%
What it returns
- Value after tax
- $19,500
- Gross spread
- $30,000
- Vested options
- 4,000
- Cost to exercise
- $18,000
- Unvested value
- $30,000
How to read the results
With the defaults above, value after tax works out at $19,500.