Founder Restricted Stock 101

Early Growth Financial Services

By Sean Greaney: sgreaney@stubbsalderton.com Originally published on Stubbs Alderton & Markiles, LLP Sean Greaney, attorney with Stubbs Alderton & Markiles, LLP gives an informative introduction to Restricted Stock for startup companies. What is founder restricted stock? Founder restricted stock refers to shares of common stock that are owned by a founder but are subject to forfeiture upon the occurrence of certain contractually agreed upon events.

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4 Deadly Legal Mistakes That Startups Make

Scott Edward Walker

Vesting Restrictions. The first deadly mistake relates to vesting restrictions. Otherwise, if one of the founders quits after a few months, he would take all of his shares with him.