Vesting is the schedule by which an employee accrues stock incentives (such as Options or Restricted Stock). The purpose of a vesting schedule is generally to provide an employee with incentive to stay with a company or provide a certain value to that company. A vesting schedule set up by a company determines the rate at which the employee receives those stock incentives.

Based on this, we can further understand that vested options are those options that are actually available to the employee for exercise, and unvested options are those options that have not yet accrued.

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