- Oct 14, 1999
- 12,006
- 312
- 126
The basic rules generally run as "In general, the repurchase price will be the price in effect on the stockholder's date of termination. Within 60 days after your termination, the Company will notify you of its intent to exercise its Right of Repurchase on your direct shares. The Company has up to 90 days from your termination date to effect the repurchase. Shares issued prior to October 1, 1981, are not subject to the Company's Right of Repurchase and may continue to be held." I assume some legislation made this legal in 1981...
Sounds like a pretty sweet deal for the "Company"s that enact these terms. You terminate several thousand stock holders with a pre-determined amount of shares that you already know, then sink the price of your own stock, and repurchase. That would be an excellent way to minimize liability held in your stock value, don't you think? Even if there wasn't a conspiracy to defraus terminated employees, it still alows a company to unfairly repurchase stock over the next 90 days after termination of the employee. Talk about profit motives for dumping employees!
Sounds like a pretty sweet deal for the "Company"s that enact these terms. You terminate several thousand stock holders with a pre-determined amount of shares that you already know, then sink the price of your own stock, and repurchase. That would be an excellent way to minimize liability held in your stock value, don't you think? Even if there wasn't a conspiracy to defraus terminated employees, it still alows a company to unfairly repurchase stock over the next 90 days after termination of the employee. Talk about profit motives for dumping employees!
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