A recent Missouri federal court decision highlights the different standards that courts employ in evaluating forfeiture-for-competition provisions contained in stock option plans. 

Summary.  Many courts testing the validity of a contractual forfeiture-for-competition provision use a “reasonableness” standard.  Recently, however, a Missouri district court judge aligned himself with the minority view and held that regardless of whether the provision in an
Continue Reading Missouri Federal Court Finds Forfeiture-For-Competition Provision in Stock Option Agreement Enforceable