Dividing stock options and RSUs in a divorce can be a complex and sensitive matter. We understand that it can be overwhelming to navigate the legal and financial implications of dividing these assets, especially during an emotionally challenging time. At our firm, we are committed to providing you with the guidance and support you need to make informed decisions about your financial future.
Understanding Stock Options and RSUs
Before delving into the specifics of dividing stock options and RSUs in a divorce, it’s essential to understand what these assets are and how they work.
Stock options give an employee the right to buy a specific number of shares of company stock at a predetermined price (the exercise price) within a specific time frame. RSUs, or restricted stock units, are a promise by a company to grant an employee a specific number of shares of company stock at a predetermined time in the future.
Both stock options and RSUs can be subject to vesting schedules, which means that an employee will not be able to exercise or receive the shares until a certain period has elapsed or certain conditions have been met. Vesting schedules can have significant implications for how these assets are divided in a divorce.
Dividing Stock Options in a Divorce
When dividing stock options in a divorce, it’s important to determine whether they are marital property, which means they were acquired during the marriage, or separate property, which means they were acquired before the marriage or after the date of separation.
If stock options are determined to be marital property, they may be subject to division between the parties. In some cases, the parties may agree to divide the options themselves, with one spouse retaining the right to exercise the options and the other receiving a cash or property settlement in exchange.
If the options are not yet exercisable or fully vested, the parties may need to address how they will share in any future growth in the value of the options. This can be a complex matter that requires careful analysis and negotiation.
Dividing RSUs in a Divorce
When dividing RSUs in a divorce, it’s important to determine whether they have vested or are still subject to vesting. If the RSUs have not yet vested, they may be subject to division as marital property, with the parties sharing in any future growth in value.
If the RSUs have already vested, the parties may need to address how they will divide the shares themselves. This can be a more straightforward process than dividing stock options, as the shares can simply be distributed between the parties.
Seeking Professional Guidance
Dividing stock options and RSUs in a divorce can be a complicated and nuanced process that requires a thorough understanding of the relevant legal and financial considerations. It’s essential to work with a knowledgeable and experienced attorney who can help you navigate the complexities of these assets and guide you toward a resolution that meets your needs and goals.
At The Blacknall Firm, we are committed to providing you with the highest level of legal representation and support throughout your divorce. Contact us today to schedule a consultation and learn more about how we can assist you in achieving a successful outcome.