Single Vs. Double-Trigger Vesting Acceleration: What Founders And Executives Should Negotiate Before An Exit

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Summary for Founders

Vesting acceleration decides what happens to your unvested equity when the company is sold
Single-trigger acceleration can vest equity at closing while double-trigger usually requires a second event after closing
The outcome depends on how your equity plan, award agreements and employment terms define change of control, Termination for Cause and Termination for Good Reason
Post-close integration changes like title, reporting lines and responsibilities often decide whether the second trigger is met
Small drafting gaps and mismatched definitions can change the result across stock options, restricted stock units ("RSUs") and other awards

Why Vesting Acceleration Becomes a Deal Issue

As a founder of a life sciences or other technology company, you know early revenue rarely sustains the business as it moves from initial concept to a working product. Growth depends on capital, partnerships and strategic transactions, which makes a control shift far more common in the early years than a slow march toward organic profitability.

When a control shift occurs, the treatment of your unvested equity becomes one of the most important economic questions in the deal. Acceleration determines whether the equity you have been working toward continues to vest under your original vesting schedule or vests sooner because of a triggering event. Acceleration terms also shape how continued employment affects your equity rights once post-acquisition integration begins.

This article outlines the key issues you should understand before any change of control event, including:

What happens to unvested equity at closing and when your original vesting schedule continues or acceleration can apply
Where your documents define "change of control," the first trigger and the second trigger
How single-trigger and double-trigger vesting works in a control event, including when equity accelerates at closing and when it depends on a second trigger
Which post-acquisition integration changes can qualify as a second trigger
Common drafting and documentation risks

How Vesting Works For You And Your Team

In the early stages, most of the capital you raise is tied up in experiments, data generation and early regulatory steps that cannot be delayed. Cash rarely stretches far enough to build a full team, so equity compensation becomes the practical way to bring in early employees and technical cofounders.

Equity also anchors people to the company's success, which matters when progress depends on research cycles, validation work and the patience needed to move a new product toward the market.

But even with equity allocations,

How do you retain your key talent and keep them focused on your business goals?

How do you maintain fairness for employees who choose to leave early after receiving an equity award?

This is where vesting gives you a structured way to balance retention and fairness. It turns an early equity allocation into a long-term commitment by linking full ownership to continued service and active participation in the company's progress.

Through vesting, employees earn their equity in step with the scientific and technical work the company needs to advance. This helps keep key contributors focused on milestones that depend on consistent effort, whether the work involves validation studies, early regulatory preparation or sustained development cycles.

Vesting also protects the cap table when someone leaves before the company reaches those milestones. Unvested equity lapses under the terms of the award, which keeps ownership concentrated among the people still moving the work forward and preserves equity for future hiring needs and later financing rounds.

Common Vesting Types and How They Work

Vesting type	How it works	Why it matters for founders
Time-based	A service-based schedule with a cliff followed by monthly or quarterly vesting. Unvested equity lapses when employment or service ends	Helps founders manage steady retention during long development cycles and preserves predictability in the cap table as turnover occurs. Time-based vesting also provides a clear baseline when negotiating acceleration in a change of control event because the vesting rules follow a consistent service clock.
Milestone-based	Vesting is tied to objective deliverables, such as key experiments, regulatory steps, technical proof points or, for more mature companies, achievement of revenue or profit goals that require clear criteria and board approval.	Aligns equity with progress that directly influences valuation and financing prospects. Useful when scientific or regulatory work drives inflection points in the company's growth or when commercial operations have become significant drivers of growth.
Hybrid	One equity award split between a time-based component and a milestone component, each with its own vesting conditions and service requirements.	Balances steady retention with direct alignment to scientific or technical results. Helps founders manage risk when progress depends on both consistent effort and specific project outcomes. Hybrid structures also give founders more flexibility during an acquisition because the time-based component is predictable and the milestone component tracks value creation.

How Change of Control Events Affect Your Vesting Schedule in Life Sciences and Other Technology Companies

As your company grows, so does the possibility of a control shift. Interest from acquirers or strategic investors often shows up right after you hit a key scientific or technical milestone. Market or regulatory changes can also push you toward outside funding if you need support to move your work forward.

In simple terms, a change of control is any shift in who controls your company. You will usually see it take one of these forms:

Stock purchase or merger: A buyer gains majority voting control or a merger leaves you and the other original investors without a controlling position.
Asset sale: Your company sells all or substantially all of its assets, which many equity plans treat as a change of control event, even if the legal entity remains.
Voting control shift: Control changes through voting agreements or board reconstitution instead of a full ownership transfer, depending on how your plan defines it.

During post-acquisition integration, the acquirer may restructure your team, consolidate functions or change reporting lines while aligning your work with its own priorities. When that happens, you immediately face questions about how your vesting schedule will apply to the equity you received before the transaction.

You may find yourself asking:

If the sale closes just before my next vest date, what prevents the loss of unvested equity under my original vesting schedule?
If I am approaching my one-year cliff, is there a fair way to account for the time I already served?
If milestones are postponed or removed at closing, what happens to the equity awards tied to those milestones?

This is where vesting acceleration matters. Acceleration allows vesting to occur sooner than originally stipulated when a triggering event occurs. Your outcome depends on the terms in your equity compensation documents, your award agreements and your employment agreement, along with how those documents define each triggering event.

Single-Trigger Acceleration vs. Double-Trigger Acceleration

Under the vesting structures you work with, your vesting schedule keeps moving until one of several events interrupts it. These arrangements generally work as follows:

If you choose to leave without "Good Reason", the unvested equity tied to your award lapses
If the company terminates you for "Cause", the unvested portion lapses and vested stock options may expire according to the equity compensation plan

If none of these events occur and the company avoids a control event, vesting completes under the original vesting schedule. Once you see that baseline clearly, the difference between single-trigger acceleration and double-trigger acceleration becomes more clear.

Single-trigger acceleration refers to accelerated vesting when a single triggering event occurs. Double-trigger acceleration requires both a control event and a qualifying involuntary termination, i.e. a termination by the company without "Cause", or a termination by the employee for "Good Reason", e.g a material reduction in responsibilities, before vesting accelerates.

What Is Single-Trigger Acceleration?

Let's say you are a founder working under a four-year vesting schedule. You are 20 months into that schedule when a large pharmaceutical company acquires your company. If your award includes single-trigger acceleration at closing, the impact on your vesting is immediate:

When the deal closes, the remaining unvested portion undergoes automatic acceleration under the terms in the equity compensation plan
You move to a fully vested position on that award
Your continued employment does not affect vesting for that specific grant

From your viewpoint, single-trigger acceleration gives you the full benefit of the equity awarded for the entire vesting period without relying on continued employment after the control event. You avoid the risk of losing unvested equity during post-acquisition integration and the acquiring company cannot suggest that vesting will depend on accepting a reduced role.

However, the traps sit in how the documents define the acceleration and which awards are included.

Acceleration of What?

Single-trigger terms may apply to one class of awards and exclude the rest. Options might accelerate. RSUs or milestone-based equity awards might not. Your protection depends on the language in:

The equity compensation plan
Each individual award agreement
Any schedule that governs performance or milestone vesting

If your vesting schedule ties to scientific milestones and a control event makes those milestones impossible to reach, the single-trigger clause must say what happens. If it does not, you may end up without accelerated vesting even though the initial triggering event occurs.

Tax Timing Issues

Immediate acceleration can move the income recognition date. That can be a real problem for options that raise Section 409A questions and for RSUs settled as part of the transaction.

Discretion Disguised as Protection

Some agreements describe single-trigger acceleration but place the decision in the board's discretion. That wording gives you no guaranteed acceleration. It is a request the board may approve only if the board views acceleration as consistent with its obligations to both the company and the acquiring company.

Whenever you review single-trigger language, you should ask three things:

What exactly accelerates
Which definitions control the outcome
Whether the acceleration is automatic or discretionary

Your answers determine whether single-trigger acceleration gives you real protection or a clause that depends entirely on how others choose to interpret it.

Why Investors and Buyers Often Dislike Single-Trigger Acceleration

Single-trigger acceleration gives you immediate certainty, but most sophisticated investors view it as a structure that creates more problems than it solves in an acquisition. Their hesitation is tied to specific operational risks that surface the moment vesting accelerates at closing.

Retention risk: A buyer may lose every incentive tied to unvested equity if the full award vests at closing, which can make it harder to maintain continuity among key employees during integration.
Valuation pressure
Accelerated vesting can increase the effective cost of the deal and buyers often adjust pricing to account for the immediate vesting that occurs under these provisions.

For these reasons, single-trigger acceleration is often tightly controlled. Investors tend to narrow it to limited scenarios, and buyers usually insist on keeping unvested equity in place so they can link employee incentives to continued employment or a defined performance path.

What Is Double-Trigger Acceleration?

Double-trigger acceleration applies only when two conditions affect your vesting schedule. You see accelerated vesting when:

A control event occurs and
A qualifying negative change in your employment or responsibilities follows

This structure is the form most investors support in life sciences and other technology companies. It sits between their interest in protecting unvested equity and the acquirer's interest in retaining key employees after closing. It also lets the board show that it considered the interests of management and stockholders when approving the deal.

From an investor's viewpoint, double-trigger acceleration requires a sequence that protects the company before the sale, then protects you after the sale. Before closing, the vesting schedule motivates you to continue building value. After closing, the acquiring company can rely on continued vesting to maintain employee retention. If you face an involuntary termination or a material reduction in responsibilities, acceleration applies so the acquirer cannot use your vesting schedule as leverage.

The Definitions That Matter

You should focus on three areas because they determine how protected you are when the structure of the company changes.

Change of control

This definition activates the first trigger. It can be limited to a transaction where a buyer acquires company stock, or it can extend to mergers, board reconstitution or an asset sale that affects control. The breadth of this language determines whether a deal that alters your influence over the company counts as a control event.

Cause

Cause language governs whether the acquirer can block acceleration. A narrow definition usually focuses on clear misconduct. A broader one can include performance disagreements, failure to meet new expectations or other events that are easy to assert during post-acquisition integration. Because Cause eliminates the second trigger entirely, you should read this definition as a protective boundary. The more precise it is, the less room the acquirer has to claim you forfeited your unvested equity.

Good Reason

Good Reason defines the negative employment change that activates the second trigger. It commonly addresses a reduction in responsibility, a material change in reporting lines, a reduction in pay or a relocation. Some clauses require an involuntary termination. A clear definition preserves the balance that makes double-trigger acceleration attractive to investors and founders.

Practical Checklist for Founders Approaching a Change of Control

Checklist item	What to do	Why it matters	Where to look
Equity snapshot	Pull your latest cap table view and list each award you hold, including what is vested vs. unvested as of today and as of the expected close date	Acceleration only applies to what is unvested at the trigger date	Cap table, equity administration platform, grant notices
Find the controlling clauses	Locate the change of control and acceleration language for each award, plus any employment or severance agreement that mentions vesting or acceleration	The deal will follow the written terms, not what people remember or what was said in hiring conversations	Equity plan, award agreement, employment agreement, severance plan
Confirm triggers and definitions	Confirm how the documents define change of control, Cause, Good Reason and the second trigger if double-trigger acceleration applies	Small definition differences decide whether acceleration happens, especially in mergers, asset sales or role changes	Defined terms sections, change of control section, termination section
Integration reality check	Get clarity on your post-close title, reporting line and core responsibilities, then compare against Good Reason or material reduction standards	Double-trigger acceleration usually turns on what changes after closing, and documentation helps if a dispute arises	Integration plan, offer of continued employment, written role description, meeting notes

Speak to Our Attorneys Today

At Crowley Law LLC, we advise life sciences and other technology companies on equity compensation and change of control terms that decide what happens to unvested equity. If you are approaching an exit event, we help you get clarity on how single-trigger acceleration and double-trigger acceleration will actually apply under your documents.

We reconcile your equity numbers to the governing paperwork

We review the equity compensation plan and each award agreement, then tie the language back to the cap table so the vested and unvested equity picture is consistent.

We identify what counts as the control event and what does not

We check the change of control definition against the deal structure, so the first trigger is not left to assumptions.

We confirm what your documents treat as the second trigger

When double-trigger acceleration requires a second event, we confirm whether the clause is tied to involuntary termination, a Good Reason resignation or both, and we flag notice and cure steps that can quietly defeat a claim.

We review single-trigger acceleration clauses for hidden limits

We confirm what awards accelerate, whether acceleration is automatic or discretionary and how the clause interacts with the original vesting schedule.

We translate post-acquisition integration risk into workable standards

We help you tighten "material reduction" language so the second trigger tracks real role changes that happen after closing, not abstract job descriptions.

We coordinate award treatment in the transaction

We confirm how stock options and RSUs will be handled and whether the deal treatment undermines the protection you thought trigger acceleration provided.

Do not go into a change of control event without clarity on where you stand. Reach out to our legal counselors today.

FAQs

Question	Answer
What Is the Difference Between Single-Trigger and Double-Trigger Vesting?	Single-trigger vesting means your unvested equity vests because one event happens, usually the change of control closing. If the deal closes, trigger acceleration applies under the equity compensation plan or award agreement, even if you keep your job. Double-trigger vesting means vesting accelerates only after two events occur. The first trigger is the change of control. The second trigger is typically an involuntary termination without Cause or a resignation for Good Reason within a defined period after closing. If the deal closes but the second trigger never happens, your vesting schedule often continues under its original terms.
What Is a Single-Trigger RSU?	A single-trigger restricted stock unit ("RSU") is an RSU that vests at the closing of a change of control based on that single event. When the acquisition closes, the unvested equity tied to that RSU can become vested under the single-trigger acceleration clause. One detail to watch is that RSUs can "vest" at closing but still settle later, depending on the equity compensation plan and the transaction documents.
What Does Double-Trigger RSUs Mean?	Double trigger RSUs are restricted stock units that do not fully vest at closing by itself. They vest only if the change of control happens and a second trigger happens after closing, usually involuntary termination without Cause or a Good Reason resignation tied to a material role change. In other words, double-trigger acceleration requires both the control event and the second trigger before vesting occurs for the unvested portion.
What Are the Benefits of Double-Trigger Acceleration?	Double-trigger acceleration is often easier to negotiate because it keeps employee incentives in place through closing while still protecting key employees if integration goes sideways. It reduces the risk that someone loses a large block of unvested equity simply because the acquiring company changes the role, cuts duties or ends employment soon after the deal. It also tends to fit how buyers want to run post-acquisition integration because retention value stays tied to continued employment unless the second trigger is met.
Where is vesting acceleration usually defined and which document controls if the terms conflict?	Vesting acceleration is usually found in three places: the equity plan, your award agreement and sometimes your employment or severance agreement. If the terms conflict, the controlling document is often the one that is written to govern that specific award, which is usually the award agreement, but some plans say the plan controls no matter what. The safest move is to check what each document says about priority, because many plans include a rule that resolves conflicts.
What counts as a "change of control" in most equity plans and what deal structures can fall outside the definition?	Most plans define a change of control as a deal where someone else takes control of the company, usually through a merger, a stock purchase that gives a buyer majority voting power or a sale of substantially all assets. Some deal structures can fall outside the definition, like a minority inv

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