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Vesting refers to the worker’s acquisition of a legal right to a certain amount of equity or shares granted upon the fulfillment of a specific condition under an equity plan.

The vesting condition can be time-based or landmark/milestone-based. In a time-based condition, the equity vests if the worker stays long enough with the company or renders services for a given period of time. Whereas, if the vesting condition is landmark-based, the equity vests when a specific milestone or event is reached such as an IPO.

There can also be hybrid vesting which is a combination of both time-based and landmark-based vesting.

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