Steve Livingston and his wife have hammered out every issue in their divorce save one: Who will take the hard assets and who will get the proceeds of Mr. Livingston's stock options.

"Most of our options are very underwater," says Mr. Livingston, a director of global strategic sourcing for Agilent Technologies Inc. in Fort Collins, Colo., who could have walked away with $60,000 in 1999 but figures his options are now worth $5,000 or less. "I've proposed a 50-50 split but she just wants the house, not the options."

Forget the kids and the dog. When marriages collapsed in the boom years of the '90s, some of the most bitter infighting involved who got the stock options. At the time, both sides were eager to grab the rights to future proceeds. The debate was fueled by the highly publicized 1996 divorce case of former GE Capital CEO Gary Wendt and his wife, Lorna -- who, in a huge victory for stay-at-homes wives, was awarded half the proceeds from her husband's options.

But now many stock options are so far underwater you need scuba gear to find them. As a result, the battle lines have changed, with executives trying to unload options in divorce settlements and their spouses resisting. Lawyers say some cases are dragging on longer than expected as couples try to push the options on one another. In other instances, people are even pushing to reopen their divorces because the options they took a few years ago are now worthless.

"Nobody wants options now," says Jan Warner, a matrimonial lawyer in Columbia, S.C. "Wives would have to be out of their minds to take them."

Valuing options, of course, is a tricky business, because they are merely the right to buy a specific number of shares, at a fixed price, sometime in the future. Putting a price on them is especially hard in a divorce when a couple's assets are divided and a judge -- rather than the market -- often determines what's a fair split. While there are complicated mathematical models that attempt to assess the future value of options, many couples are focusing on what their options are worth right now. And given the state of the market, the answer is often "zero."

"Cash is king now in divorces," says Bob Cocanower, a CPA in Fort Worth, Texas. In the past few years, he says, he has seen two executives at Alcon Laboratories, a privately held pharmaceutical firm, aggressively push their options onto their ex-spouses in exchange for more tangible assets. (As employees at a private company, the executives were issued "phantom options": Such options give an employee an interest in the firm's growth.) "The spouses aren't interested in taking the options, and the executives want to give them up because they see no future growth."

More Cash

While negotiating the terms of her divorce last fall from a managing director at Bear Stearns Cos., Tamara Weinberg become nervous about the prospects for her husband's stock options. When the market was roiled by the Sept. 11 attacks, Ms. Weinberg pushed for more cash and marketable securities. Rather than the 50% of proceeds that are often awarded in divorces, she ended up with 25% of the future proceeds from the options.

"I suppose they always have some upside potential, but I didn't even want them because I have absolutely no control over them," she says. "If he leaves his firm and doesn't exercise, the options are worthless."

Things have already soured for many spouses who took options in previous divorce settlements. Joe D'Orazio, a financial planner in Falls Church, Va., says a client came to see him recently, distraught over the plunge in value of AOL Time Warner Inc. shares. As part of her divorce settlement last year, the client received interest in future proceeds valued at $400,000 from her ex-husbands' AOL Time Warner stock options.

Since the settlement, the media giant has been beset by management turmoil and accounting questions, causing the stock to plummet. With her options now worthless, the ex-wife wanted to reopen the divorce settlement. Mr. D'Orazio told her she couldn't because she couldn't show fraud or neglect on the part of her spouse or either attorney. "I think my client wishes she took more of the retirement plan, but it's a bit late now," says Mr. D'Orazio.

But despite the skepticism, some financial planners are advising couples to take the long view. The market will eventually come back, hopefully before their options expire, and options are still solid and potentially lucrative assets, these planners say.

Shelley Meyers, a teacher in Plano, Texas, who finalized her divorce earlier this summer, has no regrets about taking a 50% interest in her ex-husband's options to buy shares of PeopleSoft Inc., even though the proceeds she could receive have dropped to about $48,000 from $120,000 two years ago.

Worth Fighting For

"These options are so low that there's no place they could go but up," Ms. Meyers says. "As the market improves they will improve too."

And even with today's stomach-wrenching market declines, Ms. Wendt, founder and president of the Equality in Marriage Institute in New York, says that stock options are still worth fighting for. "I would say 'don't be short sighted,' " she says. "Options do have value whether the stock market goes down 400 points one day and up 400 the next."

Ms. Wendt should know. Though she won't say how much she received when her ex-husband exercised his options on his departure from GE Capital to become chairman and chief executive of Conseco Inc., she does allow, "I came out very well."