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What are some of the pitfalls one should avoid when negotiating an equity compensation package with a start-up?
Many executives neglect to review the terms of their Equity Plans. Equity Plans may include provisions allowing an employer to repurchase option shares after the employment ends at less than fair market value and allowing the executive only a short period of time to exercise vested options following employment. You should negotiate for extensions of option exercise periods and acceleration of vesting upon occurrence of a liquidity event or a change of control.
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