vesting Triggers
Vesting triggers are events that cause an acceleration in your vesting schedule. Triggers are designed to protect employees from the adverse effects of certain events that might happen before they are fully vested. While nearly anything could be a vesting trigger in the vast majority of stock option agreements contemplate two triggering events:
- Change of Control. This refers to the company being bought or sold.
- Being fired. This refers to the termination of an employee's employment with the company.
Single Trigger and Double Trigger
Single trigger vesting refers to vesting which is accelerated upon change of control. In other words, whenever a company changes hands the person with single-trigger vesting immediately fully vests.
Double trigger vesting refers to vesting which is accclerated only when two conditions are met: 1) change of control and 2) termination. In other words, if a company changes hands and the person with double-trigger vesting is terminated, this person fully vests. If the company changes hands but the person is kept on as an employee and not terminated, she does not fully vest but continues to vest according to her vesting schedule.