My apologies, somewhat new to the details of this.
> ... can be forcibly repurchased at the company's choice ...
For the sake of argument, what is the repurchase price here, and if the company "repurchase" it, does the money go to the employees?
> ... can be forcibly repurchased at the company's choice ...
For the sake of argument, what is the repurchase price here, and if the company "repurchase" it, does the money go to the employees?
Employer: Welcome aboard. You get 1000 shares vesting over 4 years. They're currently worth $1 per share, which will be your price no matter when you buy them from us. You can buy the ones that have vested at any time until you leave, but you can't sell them until we've gone public.
You: Great!
Employer: You know, there's a tax trap you could fall into when you leave, whether that be before the 4 years are up, or after. If we haven't IPO'd yet, but we've done a series C at $10/share, you will surely want to buy them as you leave. But you can't sell them yet, and the kicker is that the IRS says that the act of buying them for $1,000 when they're worth $10,000 means you have a $9,000 profit in the transaction, and they'll want to collect taxes on that (say, $3,000). And you may not have the cash to manage that. Even if you do, and then the stock craters later, and you've already paid the taxes, you don't get a refund of the $3,000 in tax the next filing season; rather, you get to subtract $3,000 from any other stock gains you have (in any subsequent year), should you be so lucky. Oh, and even if we have gone public by the time you leave, if you want to hold onto your shares, you've still got exactly the same problem: pay tax now, be out the cash, and lose big if the stock tanks.
You: Fooey.
Employer: But! Have we got a deal for you! It turns out that the IRS says it's fine if you kind-of buy your shares from us now, for $1,000. (Frequently at startups: We'll even give you a bonus to cover it!) Then, when you leave after 5 years, it's a no-op as far as the IRS is concerned, and you can hold the shares until you want to sell, and at that point you have a gain that you pay taxes on, which you can certainly pay out of your cash profits!
You: Super!
Employer: The only thing is, if you leave, say, after 3 years, really you would have only vested on 3/4 your shares, so what we'll do is only hand you 750 shares (that you vested on), and a $250 refund of the rest of the $1,000 you gave us.
You: Yes, that's more than fair!
For the curious, you will commonly see such onerous terms in YC startups: https://www.clerky.com/yc-stock-plan-forms
The grant date is when stock options are granted to an employee - this is usually the first time the employee will have heard of their access to the options but if they are fore-warned of the options before a formal grant and schedule is release then they may be ineligible for any immediate vesting (generally immediate vesting triggers must happen after the grant date). The vesting date is when an option becomes eligible to exercise - on that date the grantee receives the ability to purchase shares in the company according to the strike price laid out in the options grant. Lastly you have the exercise date, that's the date on which you actually exchange some cash for some real shares in the company - after this point those shares are you personal property and are fully owned by you with no obligations to sale (though obligations around the manner of sale usually remain) - a company could declare bankruptcy but you can retain those shares forever.
Just as a note - I'm not a lawyer or an accountant, none of the information above should be construed as financial or legal advice and might just be wrong... if you're actually dealing with an options grant speak to a lawyer.
> The company shall ... for a period of three months from such date to repurchase all or any portion of the Unvested Shares (as defined below) held by Purchaser as of the Termination Date at the original purchase price per Share (adjusted for any stock splits, stock dividends and the like)
You wouldn't lose any money, they'd basically reverse the early exercise.