What are the top 10 questions I should ask about my stock grants?
You should know the answers to the following questions. Understanding the topics involved will help you to make the most of your stock grants and prevent costly mistakes.
4. What is the vesting schedule?
5. For stock options and SARs, what is the grant term's expiration date, after which an unexercised award is forfeited?
9. What would happen to the grants in a corporate acquisition or merger?
Alert: Review the stock plan, grant agreement, and any related communications materials. If uncertain about any of these questions, ask the appropriate person or department at your company or prospective employer.
In addition, you should understand the tax treatment of the grant and learn about the related Form W-2 and tax-return reporting, including the proper reporting of stock sales. Another FAQ lists questions to ask about equity grants at private (including pre-IPO) companies. For key financial-planning points to know about your stock compensation, see a related FAQ.