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What’s the consequence for employees? People with 3 years left of vesting RSUs. Will those keep vesting somehow? Or they’ll get an upfront payout? And what’s my

What’s the consequence for employees? People with 3 years left of vesting RSUs. Will those keep vesting somehow? Or they’ll get an upfront payout? And what’s my incentive to work for an established private company with no stock growth prospect? I guess Twitter will have to pay 500k senior eng. salaries in cash instead of stock?

beebmam 5y ago
Superb question. If I were an employee there, I certainly would be sending out applications elsewhere.
exhaze 5y ago
Periodic liquidity events
umeshunni 5y ago
"Voluntary, non-regretted attrition"
taf2 5y ago
It sounds like there would be a private investor pool- so options would convert?
deleted 5y ago
[deleted]
airstrike 5y ago
> What’s the consequence for employees? People with 3 years left of vesting RSUs. Will those keep vesting somehow? Or they’ll get an upfront payout? It varies. I'll preface this by saying I am not privy to the specifics of this deal, but in general this depends on the terms of the options plan. Some employees may have their options accelerated upon triggering events like a change of control. Others may have options accelerated on a "double trigger" such as a chance of control followed by termination. > And what’s my incentive to work for an established private company with no stock growth prospect? I guess Twitter will have to pay 500k senior eng. salaries in cash instead of stock? You don't need publicly traded securities to have deferred compensation. Shares continue to exist even if the company is private and liquidity events can be structured to allow employees to cash out in a "controlled and deferred" fashion. Plus you could structure deferred compensation entirely without those liquidity events or shares for that matter. Just promise to pay people $X in Y years
rootusrootus 5y ago
> Will those keep vesting somehow? Typically insta-vest and converted to cash on date of sale.
codefreeordie 5y ago
From a legal perspective, it will depend on the details of their RSU contracts. It varies widely, but generally speaking these are written in ways that give employers shockingly few rights. The RSUs at the FAANG that I worked for had all sorts of things in their contract, including that the employer could, at vesting time, choose to deliver either more or fewer shares than the number of vesting units at their sole and absolute discretion. (I spent many years employed by that FAANG, and could not find any employee or former-employee who ever received any number of shares other than exactly the number they expected -- but it was called out very clearly in the documents) From a "Twitter is a going concern" perspective, the company and its technology function today. In a non-functioning state, the assets have materially less value. As in effectively zero value. Therefore, it is in the interests of the new controlling owner to see to it that enough of the current employees remain at least long enough for a decision to be made about which of these employees are wanted long-term. As a result, I anticipate that efforts will be undertaken to see that employees are made close-enough to whole that there is not a larger mass-exodus than the change in the political party of the senior leadership is likely to generate on its own, more or less regardless of whether the employees have any shareholder rights in their RSU contracts.

beebmam 5y ago

Superb question. If I were an employee there, I certainly would be sending out applications elsewhere.

exhaze 5y ago

Periodic liquidity events

umeshunni 5y ago

"Voluntary, non-regretted attrition"

taf2 5y ago

It sounds like there would be a private investor pool- so options would convert?

deleted 5y ago

[deleted]

airstrike 5y ago

> What’s the consequence for employees? People with 3 years left of vesting RSUs. Will those keep vesting somehow? Or they’ll get an upfront payout? It varies. I'll preface this by saying I am not privy to the specifics of this deal, but in general this depends on the terms of the options plan. Some employees may have their options accelerated upon triggering events like a change of control. Others may have options accelerated on a "double trigger" such as a chance of control followed by termination. > And what’s my incentive to work for an established private company with no stock growth prospect? I guess Twitter will have to pay 500k senior eng. salaries in cash instead of stock? You don't need publicly traded securities to have deferred compensation. Shares continue to exist even if the company is private and liquidity events can be structured to allow employees to cash out in a "controlled and deferred" fashion. Plus you could structure deferred compensation entirely without those liquidity events or shares for that matter. Just promise to pay people $X in Y years

rootusrootus 5y ago

> Will those keep vesting somehow? Typically insta-vest and converted to cash on date of sale.

codefreeordie 5y ago

From a legal perspective, it will depend on the details of their RSU contracts. It varies widely, but generally speaking these are written in ways that give employers shockingly few rights. The RSUs at the FAANG that I worked for had all sorts of things in their contract, including that the employer could, at vesting time, choose to deliver either more or fewer shares than the number of vesting units at their sole and absolute discretion. (I spent many years employed by that FAANG, and could not find any employee or former-employee who ever received any number of shares other than exactly the number they expected -- but it was called out very clearly in the documents) From a "Twitter is a going concern" perspective, the company and its technology function today. In a non-functioning state, the assets have materially less value. As in effectively zero value. Therefore, it is in the interests of the new controlling owner to see to it that enough of the current employees remain at least long enough for a decision to be made about which of these employees are wanted long-term. As a result, I anticipate that efforts will be undertaken to see that employees are made close-enough to whole that there is not a larger mass-exodus than the change in the political party of the senior leadership is likely to generate on its own, more or less regardless of whether the employees have any shareholder rights in their RSU contracts.