Start with what you signed, not with what you were told

Founders in this position are usually working from what the other side says their position is. The real answer sits in three documents, and reading them takes hours rather than weeks.

Your stock purchase agreement

This is where the repurchase right lives. It sets what the company can buy back, at what price, and in what circumstances. Everything else is downstream of it.

The vesting schedule

What has actually vested as of your departure date, and whether the cliff has passed. Founders are often wrong about this by a month in either direction.

Any employment or consulting terms

Where non-competes, non-solicits and confidentiality obligations sit, along with anything about salary that could affect their enforceability.

The terms people use, and what they mean

Good leaver and bad leaver

Not statutory terms. They mean exactly what your documents define them to mean, and often the definition of bad leaver is narrower than the person quoting it at you would like.

Good leaver and bad leaver

Not statutory terms. They mean exactly what your documents define them to mean, and often the definition of bad leaver is narrower than the person quoting it at you would like.

Clawback and repurchase

Companies usually have the right to repurchase unvested shares, frequently at what you paid for them. Whether they can reach vested shares, and at what price, is the question that decides the money.

Clawback and repurchase

Companies usually have the right to repurchase unvested shares, frequently at what you paid for them. Whether they can reach vested shares, and at what price, is the question that decides the money.

Acceleration

Some agreements accelerate vesting if you are terminated without cause. Whether a pressured resignation counts is exactly the sort of thing worth arguing about early.

Acceleration

Some agreements accelerate vesting if you are terminated without cause. Whether a pressured resignation counts is exactly the sort of thing worth arguing about early.

Non-compete

Enforceability varies enormously by state, and in California employee non-competes are generally void. A long non-compete attached to below market pay is often weaker than it is presented as being.

Non-compete

Enforceability varies enormously by state, and in California employee non-competes are generally void. A long non-compete attached to below market pay is often weaker than it is presented as being.

Situations we see

Leaving before the cliff

If nothing has vested, the equity conversation is short, but there may still be a loan, an IP position or a title issue worth resolving before you sign anything.

Leaving before the cliff

If nothing has vested, the equity conversation is short, but there may still be a loan, an IP position or a title issue worth resolving before you sign anything.

Pressured into forfeiting vested equity

A common opening offer. Whether the company can actually compel it is usually a different answer from what you were told, and knowing that changes the negotiation.

Pressured into forfeiting vested equity

A common opening offer. Whether the company can actually compel it is usually a different answer from what you were told, and knowing that changes the negotiation.

An amicable split with money owed

Where you have also lent the company money, releasing your shares before the loan is repaid removes your leverage. Escrow or staged transfer arrangements exist for exactly this.

An amicable split with money owed

Where you have also lent the company money, releasing your shares before the loan is repaid removes your leverage. Escrow or staged transfer arrangements exist for exactly this.

Selling shares after you have left

Secondary sales are usually constrained by transfer restrictions, rights of first refusal and company consent. Possible, but rarely as simple as a marketplace suggests.

Selling shares after you have left

Secondary sales are usually constrained by transfer restrictions, rights of first refusal and company consent. Possible, but rarely as simple as a marketplace suggests.

What it costs

Document review and a plain answer

Quoted up front

Document review and a plain answer, quoted before we start.

Questions founders ask

Ask us directly

Ask us directly

Can they really take my vested shares?

Sometimes, if your documents say so, and the price is often what you originally paid rather than current value. But this is asserted far more often than it is actually supported by the paperwork. Read before you concede.

Is a 12 month non-compete enforceable?

It depends heavily on your state and on the circumstances, including what you were being paid. In some states this is close to unenforceable. Do not treat it as settled because it is written down.

I lent the company money. Does that change things?

It should. If there is a signed repayment agreement, that is a separate obligation from your equity, and you generally do not want to hand back the shares that give you leverage before the loan is repaid.

Will you negotiate with the company's lawyer for me?

In many cases yes. Tell us who is on the other side when you get in touch, because it affects whether we can act.

What does a review cost?

We quote a fixed fee for reading your documents and giving you a written view of where you stand. If it turns into a negotiation, that is scoped and quoted separately before it starts.

Related reading

Founders agreements, and what to sign instead

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The 83(b) election and its 30 day deadline

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Advisor agreements and advisor equity

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See how it plays out

View all case studies

View all case studies

The Deep Infra team in their office

Deep Infra

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HeyReach

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Mistos

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Focus on Building, not Legal.

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