
Startup Acquisition (Equity+Cash) Structuring - Ravindhran
Here is a question I am confused about. Say a startup is being acquired for dual interests:
a) the product.
b) recruit team members<p>Say:
&gt; Startup gets valued @ X. (for the company &amp; recruiting team)
&gt; The amount is paid out in cash (A) + stock swap(B):   A + B = X.<p>I am assuming that the stock swap (B) will come some vesting schedule of 4 years or similar. So the team members will earn their shares over 4 years of employment etc.<p>Question: 
Say a member of the team holds 10% equity in Startup, if vesting is fully accelerated. However the member is not going to join the acquirer.<p>Is the member entitled to 10% of X? Or 10% of A?
-  It seems to me that 10% of X would be unfair, because the person is not joining the company &amp; will not be working for those shares. While others will need to earn those shares through employment.
-  whereas, 10% of A sounds tricky -&gt; because if the entire deal is a stock swap only &amp; no cash -&gt; then the member gets 0.
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h4t
You still end up with the contract with the right to exercise the contract for
the stock from the vesting date until the expiry. You can sell a contract at
any time before the expiry date or you may exercise at anytime after the
vesting date up until the expiry. Here is a good link for you that might be a
good place to start: [https://www.thebalance.com/understanding-your-employee-
stock...](https://www.thebalance.com/understanding-your-employee-stock-
options-2388513)

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Ravindhran
My question is different: How do the team members who will not join the
acquirer get compensated?

