Stock options are rights to purchase company stock at a specified price during a specified period. They may be granted as compensation during or before the marriage and may have community property value depending on when they were granted, when they vest, and the purpose for which they were granted.

The community interest in stock options is typically determined by allocating the options between the marriage period and the total service period from grant to vesting.

Stock options that have not yet vested at the time of divorce present particular challenges. Division of unvested options requires careful drafting to address what happens if the options lapse, expire, or are cancelled. It is also important to note whether they were granted for past performance or to secure future employment.