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Issuing Restricted Stock to Founders

This post addresses what restricted stock and a vesting schedule are, and why to issue restricted stock to founders.

  Gavin Johnson

One of the common questions we hear from startups is whether the stock issued to the founders should be restricted. There are some important issues to consider when deciding whether to create a vesting schedule for founders. Today’s post highlights some of these issues and the main reasons for issuing restricted stock.

What is restricted stock? First things first, let’s explore what exactly restricted stock is. Restricted stock is stock that is subject to forfeiture to the company, either for compensation or for no additional compensation. Restricted stock is generally subject to forfeiture until the stock “vests” (see below for a discussion of vesting). For example, an early stage company may issue stock to its founders, but the founders are only entitled...

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From Fan to Shareholder: Buy Shares in Your Favorite Athlete

Soon you can root for your favorite athlete in a whole new way, as a shareholder in that athlete’s future financial performance.

  Gavin Johnson

The leaves are beginning to turn beautiful fall colors. The temperature is beginning to dip below 40 degrees. And football season is in full swing. I am as guilty as the rest of you spending countless hours on Saturdays and Sundays watching football, updating my fantasy football scoreboard, and rooting on my favorite team (Go Hawks!) and athletes. Soon you can root for your favorite athlete in a whole new way, as a shareholder in that athlete’s future financial performance.

Fantex Holdings Looks to Expand the Possibilities Yesterday, Fantex Holdings—a start-up company offering the first registered trading platform that lets you buy and sell stock linked to the value and performance of a pro athlete—announced its new trading exchange for investors. The...

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