How to interpret post-termination exercise language in your stock option contract
3 min
0 result
Editor’s note: A version of this question originally appeared on Reddit and has been updated for the 2025 tax year.
I’m planning to leave my job and I want to exercise my stock options. It was a difficult place to work, but I still believe in the company’s long-term potential and I think they could be successful in the future.
When I reviewed my stock option paperwork, one section about my post-termination exercise window jumped out at me:
“Following the date of termination of Optionee’s Continuous Service Status for any reason (the ‘Termination Date’), Optionee may exercise this Option only as set forth in the Notice and this Section 5. If Optionee does not exercise this Option within the Termination Period set forth in the Notice or the termination periods set forth below, this Option shall terminate in its entirety.
“In no event may any Option be exercised after the Expiration Date of this Option as set forth in the Notice. For the avoidance of doubt and for purposes of this Option only, termination of Continuous Service Status and the Termination Date will be deemed to occur as of the date Optionee is no longer actively providing services as an Employee or Consultant (except, in certain circumstances, to the extent Optionee is on a Company-approved leave of absence and subject to any Company policy or Applicable Laws regarding such leaves) and will not be extended by any notice period or “garden leave” that may be required contractually or under Applicable Laws, unless otherwise determined by the Company in its sole discretion.”
Does this mean I’d have to turn over my stock options to the company when I resign?
- Anonymous
## Understanding your post-termination exercise window
Dear Anonymous,
This section of your employment contract describes your company’s post-termination stock options exercise window.
Most startups give employees 90 days to purchase their stock options after leaving the company. If they fail to purchase their stock options inside that window, the options get taken away and put back into the equity pool.
Every year, startup employees forfeit millions of dollars worth of vested and unvested stock options. If you want to purchase your shares (i.e. exercise your stock options), double- and triple-check your stock options paperwork to understand:
Some companies have voluntarily extended their post-termination stock option exercise window to as long as 10 years, although according to Sequoia’s 2026 severance plan data and Carta’s research on post-termination exercise periods, most still give employees only about 90 days after leaving to exercise vested options.
At first glance, and with a lawyer’s help to confirm the details, the contract’s post-termination exercise language appears fairly standard for startup equity. Wishing you the best as you navigate your next career move and any decisions about your stock options.
- Vieje Piauwasdy, Senior Director of Equity Strategy at Secfi
Do you have a question about your stock options, your post-termination exercise window, or how taxes work on ISOs and NSOs for the 2025 filing year? Email us at ask@secfi.com