For shareholders (own stock outright) what happens to the shares they own when the company gets bought out is more straightforward. In a cash purchase, it's a cash payout. In a stock deal, shareholders get stock of the acquiring company. Depending on the deal terms, they may get both.
If the deal is likely to have a restriction on stock sales after the acquisition, and you will need the money right away (planning to buy a house, a new Mercedes Benz, or medical bills, etc.), then you should sell before the deal goes down because you won't be able to for a while after the deal goes down.
A Shareholder cannot generally be forced to sell shares in a company unless you have either agreed to a process resulting in that outcome, or the court orders that outcome.
The acquiring company might buy out the options for cash. They may also offer to replace those contracts with options for the acquirer of equal or greater value. The stock options may be canceled, however, if those that had been granted are very far out of the money "underwater."
The main consideration / payment (usually 50%-70%+ of the purchase price) – paid on Day One. You will always get this the day the deal closes. The day you are bought. That's the deal.
If your resignation is due to an alleged violation of the term(s) of the stock option agreement, then your company may either have you forfeit any remaining vested stock option value, or worse, may ask you to payback the value of equity awards, through a "clawback" provision.
When a private company acquires a public company, the stock of the publicly traded target company tends to rise due to the premium paid on the acquisition. After the deal closure, shareholders typically receive cash for their existing shares, leading to the delisting of the public company's stock.
The answer is usually no, but there are vital exceptions. Shareholders have an ownership interest in the company whose stock they own, and companies can't generally take away that ownership.
When there are no buyers, you can't sell your shares—you'll be stuck with them until there is some buying interest from other investors. A buyer could pop in a few seconds, or it could take minutes, days, or even weeks in the case of very thinly traded stocks.
You might need to sell a stock if other prospects can earn a higher return. If an investor holds onto an underperforming stock or is lagging the overall market, it may be time to sell that stock and put the money toward another investment.
Properly applied, a share buyback can help a company significantly enhance its value to shareholders. Managers must ask themselves if they are embarking on the buyback for the right reasons, and they should take pains to make sure that the way they implement the buyback is appropriate to their goals.
But your corporation can validly curtail that right by including a provision in the corporation's articles of incorporation or bylaws placing reasonable restrictions on the shareholders' right to transfer their shares. See Cal. Corp. Code §§ 204(b), 212(b)(1).
After an acquisition is announced, the stock price of the company being acquired typically rises to a level close to the agreed-upon purchase price. Since further upside potential can be quite limited, it may be wise to lock in your gains shortly after the acquisition announcement.
A share is a unit of ownership delivered by a capital company. In most cases, it is a commercial company with a limited liability. Holding one of several shares – in other words, being a shareholder – means that you own a part of the company's capital but you are not held personally liable for the company's debts.
Depending on your circumstances, the company's constitution (such as the articles of association and any shareholders agreement) and the financial position of the company, it may be possible to sell your shares back to the company.
Majority shareholders can legally force minority shareholders to sell stock under drag-along clauses, buyout provisions, and court orders. Minority shareholders are often compelled to sell shares in corporate takeovers and mergers when acquirers anticipate 100% equity ownership.
In an all-cash acquisition, the stockholders of the acquired company typically receive a predetermined amount of money for their shares. This means that their shares are bought out in exchange for cash.
Share buybacks are completely voluntary. If shareholders choose not to sell during the buyback period, they will hold proportionately more shares after the transaction has closed since they still own the same number of shares, but the number of issued and outstanding shares have decreased.
Suppose a deal is completed using all cash. In that case, shareholders of the acquired firm will be forced to sell their shares at the takeover price.
Technically, all shares floating in the market are bought by someone. If you mean, a single person buys all shares, then the company gets delisted. Also, it depends on the demand and supply forces as well.
A hostile takeover is a type of acquisition where a company (the acquirer) takes control of another company (the target company) without the approval or consent of the target company's board of directors . In other words, the target company's management is not in favor of the takeover, hence the term "hostile".
Stock Options
Exercised Shares: Generally, exercised shares are either paid out in cash or converted into common stock shares in the acquiring company. A cash payout will cause a taxable event while a share conversion may not depending on the deal structure and if you hold or sell the stock once granted.
If you were granted stock options and have already exercised some or all of those vested options before your departure, you already own those shares—your company usually can't claim or repurchase them when you leave.
If an option expires out-of-the-money, it therefore expires worthless, and it disappears from the account. An OTM option has no intrinsic value to the option holder, so it has no worth to the owner at expiration.