Employee Stock Option + Merger - How To?

[John Gallagher]

A while back I set up an Employee Stock Option as directed in Money
(separate account, grant info, vesting, etc.). Now the kicker: this company
has merged with another and the new company has converted these to options
on their stock - but still in an ESOP.

How do I handle this? Do I simply deliver off the old ones and set up a new
account for the new ones as of the merger date? There does not seem to be a
way of recoding a merger on these as I was able to do with the underlying
stock.

Thanks for any help.

 

[Bill Becker]

In these situations I think it is best to make the transactions in Money
match what is happening in the "real world" as closely as possible. I don't
know the details of how your options were restructured, but what I did in a
similar situation is to expire the original options on the conversion date
and create a new grant for the new options. This can be done in the same
account since an account can contain more than one option grant. I usually
label my grants as "Company XYZ March 2005 Grant", "Company ABC June 2007
Grant", etc. and keep them all in the same account.

 

[John Gallagher]

I tried to set up another grant but Money said new grant needs new account.
What am I missing here? Could you give me some direction?

Thanks.

 

[Bill Becker]

Are you maybe confusing Account and Investment? An investment is a stock,
mutual fund, bond, stock option, etc. An account is a place where you track
the values and quantities of those investments. For example, your IRA is an
account and it can contain GE stock, AT&T bonds, a Vanguard mutual, fund,
etc. Your spouse's IRA is another account and it can contain the same or
different investments.

As for stock options, here's what works for me in M2007.

In your current investment account, go to the Account Register and click on
"Show transaction forms". (You don't need to have the transaction form
showing, but I think it simplifies these instructions.)
In the transaction form, click on new
In the investment field, type in the name you want for the new stock option.
Then click in the activity field and Money will see that this is a new
investment and will pop up a "Create New Investment" dialog box
Choose Employee Stock Option as the new investment type, and fill in the
required information.
This will add the new stock optin investment as a holding in that account.

I believe that this works the same as far back as M99, but I no longer have
that versions to check.

Post back with more detail on the Money dialogs if this still doesn't work
for you.

 

[John Gallagher]

I wasn't confusing the two. I had popped up Money's help which stated that
there should be a separate account per option and only showed how to do it
that way. In this case, it makes more sense to have the new and old
together.

Thanks for the help.