Ask the Fool: What's a stock option strike price?
Since your options carry a strike price of $20, you're can buy up to 100 shares at $20 each – not their going price of $45. To exercise them all, you'll hand over $2,000 for 100 shares worth $4,500. You can hang on to them as long as you like, or quickly cash out for a $2,500 profit. Of course, it's a little more complicated than that. There are tax issues to consider, for one thing, and company stock options do expire. Read your stock option plan's rules carefully, and consider seeking professional financial advice. Kaye A. Thomas' book "Consider Your Options: Get the Most From Your Equity...
Source: postbulletin.com