A stock option is paid for by the individual or it would not be listed as an option. Generally a stock option has a time limit on them. Example, if it is a 2 year option, he would have up to 2 years to exercise the option.In this case, if the stock would shoot up to $5.00 a share, he would still be able to purchase that amount of shares for the option price of .22 and make a killing. If the price were to drop down to .05, then you would just let it expire without exercising it. Most of the time people will sit on options until the price is well above the starting price, or the deadline is approaching.
