Valuing Stock Options In Divorce

A number of our clients count stock options as part of their compensation package. Such options may be a large part of your retirement plan. But dividing stock options in divorce can be complex and a source of contention among parties to a divorce, particularly if they have not yet vested.

The Uncertain Value Of Unvested Stock Options

There remains a fair amount of leeway under Georgia law in determining whether unvested stock options are marital property, and if so, their value. William C. Gentry, Attorney at Law, has been handling complex and high-asset divorces since 1986. Our firm regularly handles issues involving employee compensation matters, including the division of 401(k)s, pensions, stock options, and other employee benefits.

With Mr. Gentry, you can rest assured you will get a comprehensive valuation of the unvested stock options at issue and a thorough analysis of Georgia law as it applies to your situation.

Want More Information?

Because determining the appropriate value and classification of stock options can be vital to protecting your financial future, you need an attorney who is familiar with this complex area of the law.

Mr. Gentry has been a practicing divorce lawyer in Cobb County since 1986. He is a respected part of the community and has helped numerous clients successfully protect their financial future when dividing complex assets. You can schedule a free consultation at 770-884-4171.

For more information on Georgia law regarding the division of unvested stock options, read on.

The Basics Of Dividing Stock Options In Divorce

The most important questions regarding stock options in divorce are:

  • Marital or separate? Marital property is property that is subject to division in divorce. Stock options are considered martial if it is acquired as a result of the "labor and investments" of either party to the divorce during the marriage. While the circumstances under which stock options can be considered marital or separate are complex, it is not simply a matter of when the stock options were awarded or the date they vested. Instead, the court looks to whether the options were awarded or vested due to efforts of either party during the marriage.
  • Unvested? What is the value? Whether your options are vested or unvested can matter a great deal to its valuation. Non-qualified employee stock options are generally not transferable, meaning the assigned dollar amount will have a great deal of influence on an equitable distribution of property (because the non-owning spouse must be compensated in cash or other assets). Because stock options are valued based on anticipated future values, there can be an inherent risk involved in overvaluing or undervaluing such options. As you might imagine, determining the value of unvested stock options is usually a large area of contention during a divorce.

Protect Your Financial Future Today

Call our Marietta office to schedule your free consultation to discuss how divorce may impact your employee or executive benefits, or reach us confidentially online here. We respond promptly to inquiries and are easily reached by phone during regular business hours.