Introduction
Exercising your stock options allows you to purchase shares in your company at a predetermined strike price.
This guide walks you through the complete process in Ledgy, from checking your eligibility through selecting your settlement method, tracking your request, completing required approvals and signatures, and finalising payment.
The entire process involves coordination between you and your company's administrators to ensure the transaction is properly documented and completed.
Before you start: Understanding exercise prerequisites
You can exercise your stock options when all of the following conditions are met:
1. Vested and exercisable options are available
You must have stock options that have vested and are available to exercise in your Ledgy account. Unvested options cannot be exercised until they reach their vesting date.
2. Active exercise window is open
Your company administrator must have opened an active exercise window for your grant. Exercise windows define specific time periods when you're allowed to exercise your options.
3. No pending requests exist
You cannot have any pending exercise requests for the same grant. If you have a pending request, you'll need to complete or cancel it before creating a new exercise request.
How to check if you can exercise
When all prerequisites are met, you'll see an open exercise banner when you navigate to Exercising in the left-hand menu of your Ledgy account.
This banner confirms that you have options available to exercise and can proceed with creating an exercise request.
Step 1: Select your grant and specify the amount
All grants with active exercise windows will appear on the exercise page when you navigate to the Exercising section.
Choosing your grant
If you have multiple grants with open exercise windows, select the specific grant you wish to exercise from the available options.
Entering the number of shares
Enter the number of shares you want to exercise in the quantity field. You can exercise any amount up to the maximum number of vested and exercisable shares available in that grant.
💡 Quick tip: Click the "Max" button to instantly select the maximum number of shares available for exercise. This is helpful if you want to exercise all available shares from that grant.
The Exercise Summary will display key transaction details including but not limited to:
Number of shares
Share price
Strike price
Estimated taxes
Total amount
Step 2: Choose Your Settlement Method
You must select how you want to handle the exercise cost and the resulting shares. Ledgy offers four settlement methods, each with different requirements and outcomes:
Method | What Happens | What You Need |
Hold all (Bank transfer) | You keep all shares and pay costs separately | Pay the costs via bank transfer |
Hold All (Payroll) | You keep all shares and pay costs separately | Costs deducted from your next payslip |
Sell All Shares | Sell enough shares to cover costs | No payment needed. |
Withhold to Cover (WTC) | Shares are withheld to cover exercise costs and taxes; you keep the remaining shares | Nothing additional |
Hold all (Bank transfer):
Hold All (Payroll):
Sell All Shares:
Withhold to Cover (WTC):
Step 3: Submit and track your exercise request
After you've selected your grant, specified the number of shares, and chosen your settlement method, submit your exercise request. Your request will then enter an approval workflow that involves several steps.
Viewing your request status
After submitting your exercise request, you can monitor its progress from your Dashboard:
Navigate to your Dashboard
Look under the Requests section
Find your exercise request, it will initially show as "Pending approval"
From the Requests section, you can:
Click the ℹ️ (info) icon to view full transaction details
Cancel the request if you change your mind before it's approved
Admin approval stage
At this stage your company's administrator must review and either accept or reject the request. During this stage, the request status will show as "Pending approval".
If the administrator rejects the request, you'll be notified and can create a new request if desired. If they accept the request, the process moves to the next stage.
Your response and approval
After your company administrator accepts your exercise request, the request status will change to "Requires response from you". You'll need to provide your approval to proceed:
Click the "Respond" button on your request
Review the transaction details in the modal that appears
Choose to either "Approve and proceed" or "Cancel the request"
If you select "Approve and proceed," the process continues to the signing stage (if required by your company).
Document signing (if required)
If your company requires document signing for exercise transactions, you'll see a red notification in the Documents sections:
The request status change to "Signing required" after you approve the request.
To complete the signing process:
Click "Review & Sign" on your request
Review the exercise document carefully - you can download it for your records
Read the AI-generated summary on the right-hand side that highlights key terms
Complete the electronic signature process
After you've signed the document, you can view and download the signed document from the Documents tab in your account. The document will show as "All signed" with options to view or download.
Payment confirmation
After signing (or after approving if signing isn't required), you'll need to confirm payment depending on your settlement method:
For Hold all (Bank transfer): You must complete payment via bank transfer as instructed. Once you've made the payment, navigate to your Dashboard, find the exercise request under the Requests section, and click "Mark as paid".
For Hold all (Payroll): Payment will be automatically deducted from your next payslip. You may need to mark the transaction as paid after the deduction is processed, or this may happen automatically depending on your company's configuration.
For Sell all shares and Sell to cover methods: Payment is handled automatically through the share sale, so you typically don't need to mark the transaction as paid manually.
After you mark the transaction as paid (or after automatic payment is processed), the status changes to "Sent for approval". Your company administrator must also confirm the payment from their end before the transaction can be finalised.
Final publishing and completion
Once your administrator confirms payment and publishes the transaction, the exercise is complete. You'll see your exercised shares reflected in your Holdings page, and the transaction will appear in your transaction history.
Exercise workflow summary
To help you understand the complete process, here's a summary of the exercise workflow:
You submit an exercise request (select grant, amount, settlement method)
Admin reviews and either accepts or rejects your request
You approve the request after admin acceptance
You sign documents (if required by your company)
You confirm payment (for Hold All method)
Admin confirms payment receipt
Admin publishes the transaction
Shares appear in your Holdings
Important considerations
Exercise windows are time-limited: You can only exercise options during active exercise windows opened by your administrator. Plan ahead and don't wait until the last moment.
Tax implications: Exercising stock options creates taxable events. The estimated taxes shown in your Exercise Summary are estimates - consult with a tax professional about your specific situation.
Payment timing: For Hold All exercises, make sure you can complete payment promptly after approval. Delayed payment may cause your request to be cancelled.
Settlement method is binding: Once you select a settlement method and submit your request, you typically cannot change it. Choose carefully based on your financial situation.
Cancellation restrictions: You can cancel your request before admin approval, but after certain stages (like after signing), cancellation may not be possible.
Document retention: Download and save signed exercise documents for your records. These are important for tax reporting and future reference.
FAQs
Where can I find my signed exercise documents?
You can find all signed exercise documents in the Documents tab of your Ledgy account. The documents will show as "All signed" and you can view or download them for your records.
Can I exercise unvested options?
No, you can only exercise stock options that have vested and are marked as exercisable in your Ledgy account. Unvested options cannot be exercised until they reach their vesting date.
What is an exercise window?
An exercise window is a specific time period when your company allows you to exercise your stock options. Your company administrator opens and closes these windows, and you can only exercise options during active windows.
I don't see any exercise banner or exercise options
If you don't see an exercise banner when navigating to the Exercising section, one or more prerequisites are not met. Check that you have vested options, that your company has opened an exercise window, and that you don't have pending requests. Contact your company's equity administrator if you believe you should have exercise options available.
My request is stuck in "Pending approval"
If your request remains in "Pending approval" for an extended period, your company administrator may not have reviewed it yet. Contact your equity administrator to check on the status and request a review.