Q&As

What happens to restricted stock units or stock options that have vested during an employee's notice period (assuming the employee is still employed at the vesting date)?

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Published on LexisPSL on 07/01/2019

The following Share Incentives Q&A provides comprehensive and up to date legal information covering:

  • What happens to restricted stock units or stock options that have vested during an employee's notice period (assuming the employee is still employed at the vesting date)?

The treatment of restricted stock units or stock options on cessation of employment (or, if earlier, on the giving or receiving of notice) is a contractual issue and the share award documentation will need to be examined and reviewed to be able to answer this question.

It is uncommon for restricted share agreements or share option agreements to not specify what happens to the award on cessation of employment of the award holder. Generally restricted stock units or stock options will be drafted to either be forfeited or to lapse (as appropriate) on the actual cessation of employment or, in some case, if earlier, the giving or rec

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