Once options have vested, the option holder can choose to exercise the option. To exercise a vested option, an exercise notice should be created and sent for signature to the grantee.
This article explains how you can exercise a vested option on Clara.
1. Click on Options (ESOP)
This can be found on the Equity tab
2. Review your existing option plan and grants
On this tab you will find any options plans you have set up, and any options associated with that plan. In this screenshot, the option plan is called 'Acme HoldCo Sip - 2023' and there is one employee with an option.
3. Click on the vested option
Click on the blue text of the vested option to view in more detail
4. Click on Manage and Exercise
Click on the manage drop down button and select exercise
5. Fill out the exercise option form
You will be prompted to input the number of options you want to exercise, the price paid per share, board and shareholder approval date, and attach any supporting documents (if any).
6. Click on Save
7. Review the Exercise Notice
Your exercise notice will automatically be saved as a draft in the transactions section. You can review, edit and delete the exercise notice while it is in draft.
8. Click Create Exercise Notice
When you are ready to create the exercise notice and send it to the option holder for signing, use this button
9. Create Exercise Notice
Input the option holders email address, this is the address the DocuSign request will be sent to. You will also be asked to confirm that you are authorised to create the exercise notice on behalf of the company.
10. Send Notice for Signature
If you have set up your ESOP using Clara's documents, the system will automatically generate an exercise notice that you can send for signature.
If you have created your ESOP without the Clara platform, you will be prompted to upload a signed exercise notice instead.
11. Exercise Notice - Pending Signature
Once the notice has been sent for signature, it will appear in the Transactions section as pending signature
12. Exercise Notice - Published
Once the option holder has signed the exercise notice the transaction will automatically update to published. The exercised shares will also be marked as fully exercised (in orange).