When offering options to an employee, they will receive a copy of the Plan Rules, which outline the rules specific to your company.

The Plan Rules will contain general ‘buy-back’ provisions, which allow the company to repurchase shares from employees under certain circumstances, such as when an employee leaves the company.

The price for buying back shares will depend on whether the employee is classified as a good leaver or a bad leaver, as defined in the Plan Rules. This helps prevent disputes later on.

If the employee holds options you’d like to cancel, you can use the Lapse function in Cake to return the options to the unallocated pool. See how to lapse options here.

If the employee has exercised their options and is now a shareholder, you can process a share buy-back through Cake. Learn how to process a buy-back here.