February 10, 2011
What Is A Put Right?
If part of your compensation comes in the form of company stock, you should know about "put rights." Company founders, key executives and others who work for new ventures and established firms are often paid in company stock. What happens if they get pushed out of the company and are left with a pile of stock that cannot be sold? Is there any way to turn that stock into cash?
Yes, the company can be forced to buy back the stock at fair market value but only if a put right was included in the shareholders agreement. Watch the video below for more on put rights and how they can make a big difference.
