Yeah. The right time to exercise when a company is filing is like...a few years before, when the shares were pretty much imaginary and you weren't standing to be taxed for imaginary wealth (why I once agonized over buying 25 cent shares for 700 bucks in a company 4 years away from an IPO, I have no idea--it's either lost money or free cash. Assume it's lost money and you're either right or happily surprised a few years down the road; both aren't such bad outcomes).

You've likely heard this, but one thing you might want to look at is a hybrid transaction (I think they call this a "cashless transaction"); exercise and sell enough to cover taxes and to purchase anything you've got available to exercise (to hold for another year).

You may net less (or much less) a year from now waiting for long term federal tax rates vs selling now - if the stock price falls rather than remaining flat/rising.

I've come to the realization that you're right, jen_h and mjs00. I'll likely be doing the cashless transaction (if offered). Basically, I didn't play this one as well as I could have and am trying to find a way to recoup now. I think it's a bit late and I should take whatever's on the table when the lockout ends (assuming there's something left)

I'll be ready for that next time. I never had access to the cheap options (since I came to the company after they'd had series C funding.

A bit of advise, you need to compare between capital gains vs stock loss. Most problems come when the stock is losing 40% of its value, and still keep it in order to avoid capital gains, ended up losing even more.

long-term cap gains are 15%, not 22% -- until 2013. unless congress intervenes before then.

pfarrell may be combining the federal 15% long-term rate with whatever his state tax rate may be?

My research is definitely spotty, so I totally appreciate the comments here!