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You could try to sell them on a secondary market if your company allows you to (it's clearly written in your stock option agreement). That of course assumes that there is a market in the first place.

You can certainly look for major red flags (e.g. weird clawback clauses in the contract, ...) but at the end of the day, even if the contract is completely clean and the acquisition is a success, the value of your equity will mostly depend on whether the board and investors will decide to screw you or not.

But realistically, can an employee get 2-3% of preferreds to secure his share? Assuming he's valuable enough to negotiate this much.

> Is there anything an early startup employee can do to safeguard against this? Is the only viable exit for a non-C-suite going public?

> Can options be traded / liquidated legally outside of the stock market?

There are secondary markets but many options have provisions forbidding unauthorized trading.

Shareholder lawsuit.