I own 200 common shares of a private company I worked for up until about 3 years ago. Today, I read in the news that they were acquired for a LOT of money but I don't know yet what the current stock price is. I still have stock options that I have 7 months left to exercise. I have a couple questions.
Now that the company has been acquired, is it likely I can sell the stock I currently own?
Would it make sense to continue exercising my stock options?
You should call up the company and ask that. (HR should be able to handle this.) Stock options cover a range of possibilities, and you'll probably need to contact them anyway to get this taken care of. You're not the only one asking these questions.
The good news is that you're probably in for a bit of a payday. "Buying" a company usually involves buying the shares, and you have both shares and the option to buy more.
Be aware that any shares you acquire by exercising options, which then get sold off (if that's how the acquiring company deals with outstanding shares of the target), will be considered short term capital gains. IOW, you didn't acquire and hold shares for over a year. So any profit you make (you wouldn't do this if the options weren't in-the-money) gets added to your base income for the year, and is taxed at your marginal tax rate (or higher, if part pushes you into a higher bracket).
tl;dr plan to put aside some earnings from stock sale to pay more income tax
You will get some combination of zero or more Dollars together with zero or more shares in the acquiring company in exchange for the shares that you already own.
Your unvested options in the old company will be converted into unvested options in the acquiring company with the same vesting schedule.
Assuming the acquiring company is public, you can sell the shares you already own at any time, possibly following a lock-up period, which probably won't apply to you as a former employee (rather than a current employee).
edit: "unvested"
