What is Accelerated Vesting?

Accelerated Vesting is a provision in a stock option agreement or employment contract that allows an employee or founder to have their unvested shares vest immediately upon the occurrence of a specific event, most commonly an acquisition or change of control of the company.

Base Term for Startups: This is a key provision to negotiate. It protects founders and key employees from being terminated by an acquirer before their shares have fully vested, which would cause them to lose out on a significant portion of their potential payout from the sale.

Types: There are two main types: "Single Trigger" acceleration (vesting happens immediately upon acquisition) and "Double Trigger" acceleration (vesting happens only if the employee is terminated *without cause* within a certain period *after* an acquisition). Double trigger is more common and founder-friendly.

Base Term Example: A founder has double trigger acceleration. Their company is acquired, and they are terminated by the new parent company 6 months later. The remainder of their unvested shares vests immediately upon their termination.