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Most agreements have a liquidity event (i.e. an acquisition) clause. They this sort of thing happens, your unvested options can be vested and exercised immediat
by rmbyrro 5y ago
Most agreements have a liquidity event (i.e. an acquisition) clause. They this sort of thing happens, your unvested options can be vested and exercised immediately.
- semiquaver 5y agoTwitter already had a liquidity event, the IPO. A going-private transaction is unlikely to be contemplated in any existing options or RSU agreement. Unvested options are technically worthless, being an option to purchase securities that will no longer exist (TWTR). In practice it would be very silly to do this to employees unless your explicit goal was to massively reduce headcount.
- ghaff 5y agoLawyers contemplate lots of things in multi-page agreements that most people don't read :-) The two times I've been acquired (by a public company but I think cash deals), unvested stock has been converted to the acquiring company's stock at the equivalent value and on the same vesting schedule. Of course, this will be a private company so the situation is different.
- semiquaver 5y ago> unvested stock has been converted to the acquiring company's stock at the equivalent value and on the same vesting schedule. Yes, this is common practice for good will and retention reasons. But generally not legally required.
- rmbyrro 5y agoTheir stock will continue to exist, just not traded publicly. Other clauses can force the buyer to acquire your stocks, like a tag along clause.