Leaked SpaceX Documents Show Company Forbids Employees to Sell Stock If It Deems They've Misbehaved

upstart writes:

'An act of dishonesty against the company' is among the violations cited:

SpaceX requires employees to agree to some unusual terms related to their stock awards, which have a chilling effect on staff, according to sources and internal documents viewed by TechCrunch.

That includes a provision that allows SpaceX the right to purchase back vested shares within a six-month period following an employee leaving the company for any reason. SpaceX also gives itself the right to ban past and present employees from participating in tender offers if they are deemed to have committed "an act of dishonesty against the company" or to have violated written company policies, among other reasons.

Employees often aren't aware of the "dishonesty" condition when they initially sign up on the equity compensation management platform, one former employee said.

If SpaceX bars an employee from selling stock in the tender offers, the person would have to wait until SpaceX goes public to realize cash from the shares - and it's unclear when that will happen, if it ever does.

[...] It's not uncommon for additional terms to be attached to employee stock compensation at startups, and employees who stay with the company long enough to vest stock may have acquired stock under various stock plans with various conditions. Yet no employee at startups and private companies is entitled to sell their stock without their employer's approval.

Indeed, at SpaceX, if an employee was fired "for cause," the company stated it can repurchase their stock for a price of $0 per share, according to documents viewed by TechCrunch.

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