Exit options

Thomas Dalby

Thomas Dalby (Gabelle) answers a query on a UK tech company that is being purchased by a US company which has offered to settle its unexercised EMI options in cash.

Question

My client is a tech sector company (TechCo) which was established in 2012. EMI options over 10% of the company were granted to key employees in 2013. At the time the company was not recording any earnings and its balance sheet looked desolate. It was agreed with HMRC that the market value of the EMI shares was no greater than their nominal value of 1p each which was set as the options’ exercise price. None of the options have been exercised. An established company based in the US (USCo) now proposes to buy TechCo for £8m through one of its UK subsidiaries (UKSub). USCo has suggested that it will cash-settle the options ...

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Thomas Dalby (Gabelle) answers a query on a UK tech company that is being purchased by a US company which has offered to settle its unexercised EMI options in cash.