For people who have gone through a successful acquisition, has it ever happened that the acquirer company made you re-vest the startup equity that you already *vested and exercised*? And if they did that, how did it work with employees who exercised their equity and then left the startup before the acquisition happened, bringing the equity with them? Were they subject to a new vesting schedule even if they were outside the company? Intuitively I would say that all the vested and exercised equity should be paid immediately at the acquisition date, and the unvested portion gets a new vesting schedule. I’m specifically looking for real experiences, not just comments as “they can do whatever they want”. The reason is that my startup might get acquired soon at a good price, and I already vested and exercised all my equity, so I’m trying to maximize the chances that I see all the cash on day 0, and if that means that I have to quit in order to not get further handcuffs, I’m fine with doing that (I’m standing to make mid 7 figures so it should be worth it). I don’t want them to say “in order to cash all the equity that you already exercised and vested you have to stay 2 more years”, so I’m trying to understand what they would do if I were not part of the company anymore, but still a shareholder like I am now. Thanks
Thanks for your reply, I’m just not sure I understand. Let’s keep aside the add on stock for a second. Are you saying that an employee who left and exercised their shares might get access to liquidity before an employee who remained and exercised as well?
So do you think it would be feasible to wait until the day of the acquisition, see what they let me sign, and if they make me sign a re-vest clause just quit on the spot and cash the equity immediately like any other former employee? Sounds insane, but that’s literally what I’m trying to understand.
Unless you have preferred shares, no you do not get anything immediately. Debt, preferred shareholders etc. are the first ones to take a piece of the pie
For this example I am assuming that the startup is selling at a price significantly above the last valuation, so all preferred shares convert to common. It’s in their best interest since they didn’t have more than 1X liquidation preferences and they were non-participating, and there was never emission of debt (I happen to know the details of our rounds).