Option clauses are one of the many well-known forms of securing the interests of parties in transaction documents, so knowledge of their mechanisms should be crucial for entrepreneurs. And this is true for both investors and startup founders who may be negotiating with them.
The primary purpose of an option clause is to provide a ‘simplified’ exit for investors in the event of a risk of project failure.
In fact, options enable one or both parties to the agreement, subject to the fulfilment of certain conditions, to sell or buy shares at a certain date in the future.
Interestingly, although these clauses are eagerly used in business transactions, there are still no regulations explicitly addressing them in Polish law. So, how can you effectively exercise option rights?