I was hired earlier this year at a public company with an offer that provided 100k in RSU, 25% cliff after first year, then remaining equally after each pay period for 3 years thereafter. A few months later the stock value tanked to 75% its value, and the company was taken private.

Since its still less than 1 year, I havent received any shares yet. However it seems like these shares were reserved for me at the date of my offer according to Schwab. Is there any recourse for essentially losing 25k? With the company going private Why isn't that I receive 25k in private equity after the first year and equal installments thereafter on a biweekly basis?

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thegelatoking t1_iydp36a wrote on November 30, 2022 at 5:10 PM

#814,431

If it was an INCREASE of 25% would you like your company to say "do over" and not count the value change? Probably not.

Werewolfdad t1_iydp5mf wrote on November 30, 2022 at 5:10 PM

#814,452

> Is there any recourse for essentially losing 25k?

No, that was the risk you took in accepting a job that pays in RSUs

https://zajacgrp.com/insights/the-basics-of-restricted-stock-units/#:~:text=If%20the%20price%20goes%20down,stock%20units%20to%20incentivize%20employees.

i_get_the_raisins t1_iydr9c8 wrote on November 30, 2022 at 5:24 PM

#815,142

It's very likely you were not offered $100k, but you were offered a quantity of shares valued at $100k at the time of the offer.

That's important: you weren't promised dollars, you were promised shares.

You're still getting the shares you were promised, so there's nothing for you to have recourse against. The deal hasn't changed.

bulldg4life t1_iydraxx wrote on November 30, 2022 at 5:24 PM

#815,157

When the stock was taken private, were you not given compensation for any unvested shares? I'm surprised you now hold equity in a private company.

Also, no, there is no recourse. That's the risk of having some compensation tied to stock price.

urza5589 t1_iydrp6w wrote on November 30, 2022 at 5:27 PM

#815,282

Replying to thegelatoking (#814,431)

I don't think he is so much wanting recourse on the decline in value of the units but on the fact the going private basically removed them altogether.

theoriginalharbinger t1_iydt9bd wrote on November 30, 2022 at 5:37 PM

#815,786

Get paid in RSU's, that's how it rolls. You're entitled to the value of the stock at the point in time the company was taken private, most likely (whatever the strike price for acquisition was).

> Why isn't that I receive 25k in private equity

Because the whole point of private equity is that the PE entity maintains a controlling stake.

sciguyCO t1_iydu9wu wrote on November 30, 2022 at 5:43 PM

#816,152

In the RSU agreements I've seen, what you're "really" being offered is some number of shares. The dollar amount that gets quoted is based off of the stock price at that time, but that's not usually guaranteed. So if it was trading at $100 / share when you were hired, they were agreeing to give you 1000 shares. If the company stock goes down to $75, you should still be owed those 1000 shares, vesting 250 of them after one year then more as time goes on.

The fact the company went private can certainly change things. One the one hand, your RSU agreement may stand, but you just receive shares in a non-public company. That usually makes valuing them more ambiguous, and can limit who is available to buy them from you. Or there might've been some "buyout" of outstanding shares (vested or unvested), but you should've gotten some communication about that. Or maybe going private involved invalidating any RSU agreements, which would definitely be a dick move, but might be allowed.