Option Exercise Agreement Template

This Option Exercise Agreement is made on [Date] by and between:

Company: [Company Name]
Address: [Address]

Option Holder: [Full Name]
Address: [Address]

1. Background

The Option Holder holds an option to purchase equity interests of the Company under the following documents:

Equity Plan Name: [Plan Name]
Option Agreement Date: [Date]
Grant Date: [Date]
Grant Number or Reference Number: [Number, if applicable]

The Option Holder wishes to exercise all or part of the vested option rights described above, and the Company agrees to accept that exercise subject to this Agreement and the applicable plan documents.

2. Option Exercise

The Option Holder hereby exercises:

☐ all vested option rights available for exercise
☐ a portion of vested option rights

Number of Shares or Units Being Exercised: [Number]

Type of Security to Be Issued: [Common Stock / Preferred Stock / Units / Other]

3. Exercise Price

Exercise Price Per Share or Unit: [$Amount]

Total Exercise Price: [$Amount]

The Option Holder agrees to pay the exercise price in full in accordance with this Agreement and the applicable option documents.

4. Payment Method

Payment shall be made by the following method:

☐ cash
☐ check
☐ wire transfer
☐ cashless exercise, if permitted
☐ net exercise, if permitted
☐ payroll deduction, if permitted
☐ other: [Describe]

Additional payment details, if any:

[Insert details]

5. Tax and Withholding

The Option Holder understands that the exercise may create tax obligations.

Any required withholding, reporting, or related tax amount shall be handled as follows:

☐ paid directly by the Option Holder
☐ withheld through payroll, if permitted
☐ withheld from shares, if permitted
☐ other: [Describe]

The Company may require additional forms, certifications, or payments before issuing the shares.

6. Conditions to Issuance

The Company’s obligation to issue the shares or units is subject to:

receipt of full payment of the exercise price;
satisfaction of any required tax withholding;
compliance with the option plan and option agreement;
delivery of any additional documents reasonably required by the Company;
compliance with applicable law and securities restrictions.

7. Share Issuance

Upon satisfaction of the conditions above, the Company shall issue the exercised shares or units as follows:

☐ in the name of the Option Holder
☐ jointly with: [Name]
☐ in book-entry or uncertificated form
☐ in certificated form, if available
☐ to the following account or transfer instructions: [Details]

8. Representations of Option Holder

The Option Holder represents that:

the Option Holder has authority to enter into this Agreement;
the exercise is being made in accordance with the applicable option documents;
the Option Holder understands that the shares may be subject to transfer restrictions or other company requirements;
the Option Holder has reviewed the relevant plan and grant terms before signing this Agreement.

9. No Other Changes

Except for the exercise described in this Agreement, the original option plan and option agreement remain unchanged and in full effect.

Any remaining unexercised option rights shall continue to be governed by the applicable plan and grant documents unless they expire or are otherwise terminated according to their terms.

10. Governing Law

This Agreement shall be governed by the laws of the state of [State].

11. Entire Agreement

This Agreement contains the full understanding between the parties regarding the option exercise described above and replaces prior discussions on that subject unless otherwise stated in writing.

12. Signatures

Option Holder Signature: __________________________
Name: [Full Name]
Date: [Date]

Company Signature: __________________________
Name: [Full Name]
Title: [Job Title]
Date: [Date]