Leaving startup MZ should I exercise the vested options
I have been at pre IPO startup Machine zone for 4 years. I have a good amount of ISO vested that was given at price of 0.01 per share and current value is $1.4. Should I exercise the options and keep it. Or just leave it to avoid AMT issues. I have 80k units. Any suggestions?
Check your contractual clauses. See who is allowed to purchase.
The contract says I am not allowed to sell it to any third parties
Is $1.4 the fair market value or is it based on latest funding valuation? What matters for AMT is the fair market value (FMV). It’s what new hires get as strike price.
$1.4 is FMV
How do you like it there? They recruited me two years ago
The company is doing ok compared to what it was 2 yrs back. It was in top 2 grossing apps at that time. I am thinking of exercising a fraction of vested options and pay AMT now. Then when / if company goes public I will sell the shares hopefully
More than likely, they’ll never be worth anything so consider the ~$800 you spend to exercise them as a loss. Then, if they end up being worth something, it’s a bonus.
Just buy it since it's so cheap. You have spent your sweat and blood for 4 years at a company which has been known for being a terrible place to work. The least you can expect in return is that when they are bought over you make some money from it. 800$ is nothing compared to the possible upside it has. Worst case scenario if it's bought for 1$ per share which is less than it's fmv (which in general is much much lower than it's actual value) that's still 80k. I am not sure what and why you are worried about amt here? Amt is on strike price vs fmv which is 800 bucks in this case. Depending on when you sell your options you still have to pay tax on fmv vs actual value of sale per share. But in any case just buy it dude don't think too much. If it goes big then great if it doesn't think of it that you blew 800$ in Vegas. That's still better than repenting in future saying damn I missed the boat
Err, one correction: AMT is calculated on spread, not the grant price. For 80k shares - you might end up with a significant tax bill next year
Buy it dude. Most ppl here haven’t done their research. The shares are selling at $4 on the second market. This was as of March 2018
What app is this from?
They fired their art department and sent half of the marketing art team to Las Vegas, so I think they are getting ready to go public by cutting cost
It’s going to zero. GOW and MS are not making money Final Fantasy XV is a big time scam game same as GOW with a different skin. Most gamers have already realized it and the revenues are going down. RT platform is gone with the CEO to build another scam crypto company. You are better of staying away from it for now.
Good Call.
Sell them to someone if you decide you don’t want them.