Structuring employee agreements for portfolio companies
Hi all -- We're looking for some help structuring employee agreements for one of our portcos. Does anyone know of a structure for dealing with a company's right to buy back vested employee shares after the employee leaves that is somewhere between (a) the company having sole discretion to repurchase at cost/current value and (b) the company having no right to repurchase the employee's shares?
Trey Calver: Hey Susan, companies usually only have a repurchase right if the employee is terminated for cause. However, if the employee tries to sell the stock, the Company usually has a right to first offer, e.g., has the first shot to buy back the stock. Existing stockholders usually have a shot at buying the stock after that. I imagine you want to incorporate a repurchase right at fair market value if any employee’s position is terminated for any reason. Happy to touch base if helpful! I’ve helped a handful of companies put together equity incentive plans with different terms.
