What is single-trigger acceleration?
Single-trigger vesting acceleration is an equity provision under which unvested founder shares or employee options accelerate (vest immediately) upon a single defined event — typically a change-of-control transaction (M&A, IPO) — without requiring any additional condition such as termination of employment. Single-trigger is the more founder/employee-friendly mechanism but is materially harder to negotiate with acquirers, who view it as eroding post-deal retention incentives.
Mechanics
- Trigger event: change of control — M&A, sale of all/substantially all assets, dissolution; sometimes IPO (rare).
- Acceleration scope: typically 100% of unvested; sometimes partial (50%, 24-month additional).
- No post-closing condition: shares vest at deal closing regardless of whether holder remains employed.
- Timing: acceleration is typically deemed effective immediately prior to closing for tax/280G purposes.
Single-trigger vs. double-trigger comparison
- Single-trigger: founder-friendliest; locks in equity value at exit regardless of acquirer relationship.
- Double-trigger: market standard; requires both CoC + termination; balances founder protection with acquirer retention needs.
- Hybrid: e.g., 25% single-trigger + 75% double-trigger; sometimes negotiated for senior founders.
When single-trigger is appropriate
- Highly-sought founders: star founders with strong negotiating leverage may secure single-trigger.
- Acqui-hire scenarios: when acquisition value primarily reflects the founder team, single-trigger may align incentives if founders prefer optionality.
- Late-stage employees: sometimes granted partial single-trigger for retention.
- Avoid for early employees: creates retention misalignment post-acquisition.
Single trigger in negotiation
Single-trigger acceleration — vesting on change of control alone — is the founder-friendliest and buyer-hostile end of the spectrum: acquirers price retention, and equity that fully vests at closing removes the retention tool, which is why pure single trigger has become rare for executives and is usually negotiated down to double trigger (deal plus termination) during term sheets or at the acquisition itself. Where single trigger survives, it concentrates in board-level advisors and small percentages. Turkish phantom-plan equivalents replicate the choice in payment triggers: paying out fully on exit versus conditioning part on post-closing service. The drafting detail that decides disputes: define change of control precisely (share sale thresholds, asset deals, mergers) and state whether acceleration covers all unvested equity or a fraction.