An options clause, usually - giving the founder the right to buy back the company/brand at a fixed price - it's enticing to new owners too because it mitigates their risk (e.g. if they run it into th ground while the old owner is interested in it, then it will limit their losses) - the difficulty then is not making the buyback price too high that the original owner can't afford it, or if the new owner screws it up so badly that the original owner loses interest.
This is light grey. I'm dissapointed in you HN. This is absolutely correct.
One common version: Many sells come with some sort of earn-out. Meaning that the company has to perform at some level over some amount of time in order for the buyer to be on the hook for the full amount of the sell price (or some other bonus).
It is not uncommon to attach a buy-back clause to the earn-out. If you fail to hit the earn out, you have some ability to buy back the company and/or it's assets (there are many different versions). It's a win-win clause. If the company fails to perform under its new leadership the buying company has some hedge against it. It gives the seller a chance to effectively hedge at least some of the risk that they won't be able to fully earn-out the purchase price due to management issues at the new company.
I've been on the executive team for five company sales. Two of them had exactly this clause. Both during earlier stages. We never exercised them.
Don't cry for me, I'm a low quality poster(or rather, I tend to match the quality of posts I respond to, which are frequently low quality posts) who dang has had to put in place multiple times.
But I will say that I originally created this username many years ago to at least try to rebut ridiculously wrong things which were popularly accepted in the comments section, or right things which were down voted, so I am used to this.
I think this site has a problem in that a poorly stated truth is considered a bad post, but nonsense, as long as it is follows a certain style and rhetorical form is welcomed with open arms. But oh well, it isn't my site to run.
A poorly stated truth contributes less to the discussion than a well-formed but incorrect post. Or at least, the end result is that I find the discussion here more valuable than on most of the web (as much as it's declined under dang's niceness policies).
