Section 6039 of the Internal Revenue Code requires companies to provide Forms 3921 and 3922 to employees who exercised incentive stock options or first transferred ESPP shares during 2025, with employee statements due by February 2, 2026. Employers must also file these forms with the IRS by March 2, 2026 (paper) or March 31, 2026 (electronic), with electronic filing mandatory for companies submitting ten or more forms of a given type. Failure to file or furnish the forms on time can result in significant per-form penalties, making timely compliance critical for corporations administering equity plans.

OpenAI is reportedly paying employees an average of $1.5 million each in stock-based compensation, making it the most generous major tech startup by far and pushing equity pay to nearly half of projected 2025 revenue. The payouts—driven by fierce competition for elite AI talent, especially from Meta—dwarf pre-IPO compensation at companies like Google and Facebook and are projected to add about $3 billion a year in stock costs through 2030. While the strategy helps OpenAI retain top researchers during the AI arms race, it has also significantly inflated losses and highlights how far the company has moved from its nonprofit origins toward an equity-heavy, hybrid commercial model.

Tesla directors have collectively earned around £2.5bn from long-term stock option awards between 2018 and 2024, far exceeding board payouts at other major tech companies as Tesla’s share price surged. Despite pausing board compensation in 2021 amid criticism, earlier option grants—particularly to figures like Kimbal Musk, Ira Ehrenpreis, and Robyn Denholm—have continued to generate enormous gains, highlighting how Tesla’s option-heavy approach magnifies upside with little downside risk. Compared with the “Magnificent Seven,” Tesla’s board pay is unusually high and controversial, raising governance concerns, though investor confidence in the company has remained largely unaffected.

Stride Inc. shareholders approved updates to the company’s equity programs, including expanding the 2016 Equity Incentive Award Plan by 740,000 shares and extending it through 2035, as well as adopting a new 2025 ESPP for up to 4 million shares. The ESPP allows eligible employees to purchase company stock at a discount via payroll deductions. Shareholders also elected all director nominees, ratified KPMG as auditor, and approved executive compensation on an advisory basis.

Sunrun Inc. was among last week’s worst performers, with its stock falling 13.18% after announcing plans to register nearly 40 million new shares under its equity incentive and employee stock purchase plans, raising dilution concerns. Investor sentiment was further pressured by uncertainty around the looming December 31 deadline for clean energy tax credits, prompting some to reduce positions despite a potential short-term sales boost. While Sunrun may benefit from last-minute demand, investors remain cautious, and some see greater near-term upside in alternative sectors such as AI.

In volatile markets, underwater stock options have lost much of their motivational and retentive value, prompting a renewed wave of repricings in 2025, especially in the Life Sciences sector. Traditional repricings are often costly and complex due to tender offer requirements, but the newer “Premium” Approach restores value by repricing options at the money while using a time-limited exercise period that effectively reinforces retention without making employees worse off. As falling 409A valuations continue, this approach has emerged as a practical, widely adopted solution to keep equity meaningful and employees engaged.