Yes, you'll have to pay capital gains. Since it has been more than 1 year, it will be long-term capital gains. I don't recall off the top of my head what the rate is, but since it isn't 100%, you'll still have money in your pocket!
ETA: long-term capital gain tax rate is 0% for the 10%–15% brackets; 15% for the 25%–35% brackets; and 20% for the 39.6% bracket (from Google). I'm not a tax account, but I believe this applies just to the capital gain itself. So, if the stock is worth $1,000, you should end up with a net of $800 even in the worse case scenario.