HACKER Q&A
📣 throwaway071724

Appraisal Rights in a Merger


I recently learnt that my previous place of work (a non public software startup) is getting merged into a different company. I have a decent number of exercised options and it appears that they all become worthless upon the merger. The acquisition price is about ~1 ARR which seems low considering the company does not have much debt and was profitable not too long ago. From what I can tell, the merger is done by a private equity company looking to expand the product line of one of their portfolio companies.

The merger agreement mentions that certain stockholders are entitled to have the fair value of their shares judicially determined and paid to them by complying with Section 262 of the DGCL. I wasn't asked to vote on the merger, so not sure if the section applies to me.

I am no longer employed with the company, so it is hard to understand what any of that means and if I can do anything to get some money for my shares.

Did anyone have experience with mergers and going through with the fair value evaluation? Or maybe someone can recommend a law firm that may offer a paid consultation?


  👤 MatthiasPortzel Accepted Answer ✓
> I have a decent number of exercised options

This wording is unusual to me. Once you exercise an option, you no longer have it because you’ve used it to buy shares.

If you have ownership shares in the company, and the company was bought, then you should have been compensated (in theory, depending on the terms of the acquisition—hire a lawyer).

If your options were merely vested and not exercised, then they could now be worthless.

I’m not a lawyer; I’m commenting only because this is in new and no one else has commented. If others comments will be made they will probably be better informed than this one.


👤 toomuchtodo
Buy an hour of time with https://news.ycombinator.com/user?id=grellas to evaluate your options.