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My Dad has some options in the company where he works, but he knows nothing about investing and does not care to learn. I was wondering if it would be possible for him to excercise his options, sell the stock to me at the same price, and then I could sell them later. (This is all assuming that the company is good, which I have yet to determine.) I was just wondering about the mechanics involved in a transaction like that. Is it possible?

Mike in NJ
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My Dad has some options in the company where he works, but he knows nothing about investing and does not care to learn. I was wondering if it would be possible for him to excercise his options, sell the stock to me at the same price, and then I could sell them later. (This is all assuming that the company is good, which I have yet to determine.) I was just wondering about the mechanics involved in a transaction like that. Is it possible?

Mike in NJ


How much would the stock be worth? He can give you up to $11,000 a year.

Some of the others around here probably can give you more details.
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<<How much would the stock be worth? He can give you up to $11,000 a year.>>

I am not sure what the stock would be worth, I haven't really discussed it with him yet. The main concern I have is that the company he works for is not all that great (AOR). He told me once, though, that his options are for about half of what the stock is currently trading for, so I am not sure how much of a hassle it would be to do all this. I am mostly in hypothetical mode right now! Thanks for the input.....

Mike in NJ
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Mike

It is sometimes both permissible and possible to transfer ownership to an immediate family member. But you and your Dad should check company rules, etc., carefully before doing it. You don't mention what kind of options these are, whether NonQualified or Incentive Stock Options; the difference can be significant in terms of the tax consequences.

One thing for sure, if they are worth more now than the option price, your Dad should not allow them to just expire unexercised as some do. That's sheer folly, whatever the reason. It's, as the expression goes, "free money," just waiting for him to exercise it.

You and he would do well to do some research --- which might make him feel more comfortable too -- at www.fairmark.com and www.mystockoptions.com. Both are sites dedicated to educating people like you on the ins and outs of stock options.

mathetes
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