“Acceleration” refers usually to the waiver or lapse of Vesting requirements that would otherwise be applicable to a grant of Equity Compensation. In other words, the Vesting requirements “accelerate” and give to the grantee Vesting “credit,” notwithstanding the fact that the Vesting schedule has not yet ended.
Acceleration of Vesting is an important economic benefit that is usually reserved for, and negotiated by, Founders, executives and other key players that receive Equity Compensation awards that are subject to Vesting requirements. Acceleration of Vesting helps ensure that these contributors receive the intended benefit of their Equity Compensation awards in certain special situations, such as in the event of a Change of Control or in some cases where a Founder, executive or other key player is terminated without Cause or constructively terminated for Good Reason. Acceleration of Vesting usually entitles the grantee to receive Vesting credit for all (i.e., 100%) or another amount (i.e., 50%) of the Unvested shares of Capital Stock or Stock Options held by the grantee. Acceleration of Vesting is usually formulated as either: (i) Single-Trigger Acceleration, where a single event, such as a Change of Control, triggers Acceleration; or (ii) Double-Trigger Acceleration, where, as the name implies, there are two triggers – typically a Change of Control and later termination of service, both of which must be met as a condition to Acceleration.