A business example
A fictional employee receives 100 options, of which 25 later vest under the grant's assumed schedule.
Grant
The employee receives contractual options subject to the plan.
Vesting
25 options become exercisable under the assumed conditions.
Exercise
If exercised and allotted under the plan, those options lead to shares.
What this shows
Unvested options, vested options and issued shares are different positions. The numbers here are plan assumptions, not a prescribed vesting rule.
What it is often confused with
Grant, vesting, exercise and sale are separate events; an option grant is not the same as owning shares.
What to look at in your business
Read the plan, grant letter, exercise price, exit terms and tax guidance.
Context and further reading
This entry explains the business term. The related guide below provides the next layer of context; any applicable legal test depends on the transaction and relevant period.
Kosha.Services · Updated 2 October 2026