Searcher's Equity vesting in case of Early Exit

searcher profile

July 04, 2024

by a searcher from Massachusetts Institute of Technology - MIT Sloan School of Management in Milano MI, Italia

Hi All, does anyone know if there's an accepted standard on how to regulate the vesting of Searcher's Equity in case of Early Exit. More specifically, what happens to the second tranche (in case of a standard 8.33 x 3 vesting scheme) that is supposed to vest linearly over x years starting from the day of the acquisition?

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Reply by a searcher
from Vanderbilt University in Orlando, FL, USA
It depends on what the searcher negotiates with the investor base in the LLC agreement. It could be a forced repurchase of vested amount based on time at the Co. Or the searcher could keep that equity with only receiving vested equity based on the amount of time spent at the company
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