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Ask HN: Founder claims I never purchased options, but I deposited checks

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Ask HN: Founder claims I never purchased options, but I deposited checks

#1

Post by sqquuiiiddd »

My previous company (Bay Area startup) was acquired by a Fortune 500. I reached out the founders, congratulating them and asking about my options. The Fortune 500 lawyer team responds saying "[they] do not have a record of any shares held by [me]". I reply back with a copy of a check I made out to Bay Area startup with a Memo explaining that this money is to purchase the options. The check was cashed and endorsed with the Founder's signature on the back.

Other than this check and the 83b election document, I don't have any other documentation about how many options I own.

PLEASE HELP. I don't know how to proceed. Do I begin Arbitration or find an attorney?

I am totally put off right now, feeling betrayed by the founders.

Edit: Thanks everyone for the warm thoughts and advice--I'm looking for a lawyer now. Really glad I posted.

Re: Ask HN: Founder claims I never purchased options, but I deposited checks

#3

Post by sqquuiiiddd »

foobarbazetc wrote: post #2

Do you have proof they cashed them? If so, talk to a lawyer.

Yes I have bank statements that show the check was cashed.

> talk to a lawyer

The amount of the acquisition was not disclosed. I don't know if my options are worth more than lawyer fees. What kind of lawyer do I need to look for?

Re: Ask HN: Founder claims I never purchased options, but I deposited checks

#6

Post by vinothgopi »

sqquuiiiddd wrote: post #3
foobarbazetc wrote: post #2

Do you have proof they cashed them? If so, talk to a lawyer.

Yes I have bank statements that show the check was cashed. > talk to a lawyer The amount of the acquisition was not disclosed. I don't know if my options are worth more than lawyer fees. What kind of lawyer do I need to look for?

If it is a public company, their SEC filing should reveal how much they paid for the acquisition.

Re: Ask HN: Founder claims I never purchased options, but I deposited checks

#7

Post by tibbetts »

Lawyer. Also find out what bank is handling the transaction (often US Trust if they used https://www.srsacquiom.com/ which is very popular). There is often a 15% escrow hold back on the transaction value for 12-24 months to account for just this sort of thing, so it is very possible to resolve.

Re: Ask HN: Founder claims I never purchased options, but I deposited checks

#8

Post by louisswiss »

vinothgopi wrote: post #6
sqquuiiiddd wrote: post #3

Earlier quoted context omitted.

Yes I have bank statements that show the check was cashed. > talk to a lawyer The amount of the acquisition was not disclosed. I don't know if my options are worth more than lawyer fees. What kind of lawyer do I need to look for?

If it is a public company, their SEC filing should reveal how much they paid for the acquisition.

It's not that easy unfortunately - there will almost certainly be different classes of shareholder and various clauses to protect investors etc. Your options may well turn out to be worthless.

Re: Ask HN: Founder claims I never purchased options, but I deposited checks

#10

Post by pjdemers »

econner wrote: post #4

You don't have a share purchase agreement that was signed by both you and the founders?

And a copy of the option grant itself? Also signed by the founders. Plus, if it was a taxable event, there should be a line item on your W2 with the taxable amount. Otherwise a form 3821 so you can prove to the IRS you don't owe taxes.
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