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Stock Options and Restricted Stock Units

Division of stock options and restricted stock units are common divorce issues in California because many employees receive stock options and stock units as part of their compensation packages. Not only may these assets be deemed community property, but future stock options and units may be taken into consideration for child support and spousal support calculations.

It is important to understand the different methods utilized by the court to value these assets, as the valuation method presented could dramatically affect the community’s interest.

For example, one method to value the community’s interest in stock options backdates the community’s interest to the employee spouse’s date of employment. A more common method values the community’s interest on the date the stock options were granted by the employer. (The former method will give the community a much greater piece of the stock options than the latter.) And just because a stock option has not yet vested does not mean the community has no share in it.

COVID-19 Update: Ford Family Law is fully operating during the COVID-19 crisis, and we are here to help our current clients and new clients during this time. For the safety of our employees, we are all working remotely from home and using Zoom, Teams, and other technologies to conduct telephone and video meetings and conferences. We are also proceeding with depositions and mediations using these technologies, where possible. Please do not send us any mail via USPS or overnight delivery until further notice. Please email or call us instead. Thank you.

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