This Founders Agreement have been entered into by::
[=Founder 1 address]
(the "Founder 1")
[=Founder 2 address]
(the "Founder 2")
[=Founder 3 address]
(the "Founder 3")
[=Founder 4 address]
(the "Founder 4")
The undersigned, individually referred to as the “Founder” and collectively to as the “Founders”, are collaborating with the purpose of developing together a Business Concept.
The Business Concept relates to the Following:
[Project Name] is a [Project description]
Founders agree that all related technology to the Business Concept is also owned by the Founders pursuant to this Agreement (together, the “Business Concept and Technology”). As the Business Concept is further developed, Founders intend to transfer the Business Concept and Technology to a limited liability company formed by the Founders (the “Company”) upon the earliest of the following circumstances: a) to comply with commitments to parties outside of the founding team either customers, soft funding or investors or other. b) the founders commits their whole working effort to the Project
In connection with such collaboration, the undersigned hereby agree as follows:
1. TRANSFER OF OWNERSHIP TO COMPANY UPON FORMATION
1.1 Each Founder shall grant and assign to the Company immediately upon its formation all of his or her right, title, and interest in and to the Business Concept and Technology (including all right, title and interest to intellectual property thereto), including all ideas (however formed or unformed) and labor and/or work product that results from any task or work performed by the Founder that relates to the Business Concept or Technology for the full term of such rights. Each Founder shall also perform any and all acts and execute all documents and instruments as may be required by the Company at its sole discretion to perfect title in the Business Concept and Technology, and any related intellectual property.
1.2 For purposes of this Agreement, the Company shall be considered formed upon registration and recognition of a business entity by the Norwegian government, including but not limited to registration and recognition of a limited liability company or any form of corporation.
2. OWNERSHIP STRUCTURE UPON FORMATION
2.1 Upon formation of the Company, the entire issued share ownership of the Company shall reflect the following:
[FOUNDER1 SHARES AMOUNT]
[FOUNDER2 SHARES AMOUNT]
[FOUNDER3 SHARES AMOUNT]
[FOUNDER4 SHARES AMOUNT]
The Founders plan to issue shares towards new employees once the next 3-5 employees are hired, diluting their respective holdings in the company by up to 20%.
[When the Company is incorporated, the Founders shall enter into the shareholders’ agreement in SCHEDULE 1].
[When the Company is incorporated, the Founders shall enter into a shareholders’ agreement that contain customary rights and obligations for the Parties, as follows:
- Board representation: : The board shall consist of 3 – 7 members. Any shareholder holding more than 10% shares of the company can appoint 1 board member.
- Confidentiality, non-compete, IPR: The shareholders’ agreement shall contain customary provisions regarding confidentiality, non-compete and protection/ownership of Company IPR.
- Obligations for the Founders: The Founders will commit to continue full time employment with the Company for four years. In the event that the employment with the Company is terminated during the four years, the Founders are obligated to sell all or some of the shares owned by the Founder to the Company. This obligation will be reduced over time (reverse vesting) with 1/48 of the shares on a monthly basis. The purchase price shall be equal to the purchase price the Founder paid for the shares.
- Board approval and right of first refusal: Transfer of shares in the Company shall be subject to the approval by the board of directors, and a right of first refusal for all shareholders.
- Drag along: Should one or more shareholders who jointly own more than 50 % of the shares propose to transfer, in any transaction or series of transactions, all of their shares to an unrelated third party buyer, the selling shareholders have the right to require each of the other shareholders to sell all of their shares, at the same price and on the same terms and conditions as the selling Shareholders. The drag-along right is conditional upon the sale taking place on market terms and conditions.
- Tag along: In any transaction or series of transactions of Shares in the Company, each of the other shareholders shall have the right to sell a pro rata portion of its shares equal to the portion of shares such selling shareholders will sell, at the same price and on the same terms and conditions as the selling shareholders. ][a]
2.3 The Founders agree to be bound, perform and comply with the terms and conditions of the individual Employment Agreements in SCHEDULE 2, effective from the formation of the Company.
3. ROLES AND RESPONSIBILITIES UPON FORMATION
3.1 The following roles will be assigned to each founder at the formation of the Company:
CEO, Chairman of the Board
Forming of the company, recruitment,
CTO, Deputy Chairman of the Board
VP of Sales and Marketing, Board member, Board Secretary
All sales and Marketing efforts
VP of Engineering, Board member
4.1 The Founders agree to keep the Business Concept and Technology confidential; disclosure of the Business Concept and Technology will occur only on an as-needed basis and only upon consent of all Founders. Notwithstanding such unanimous consensual disclosures, the Founders shall take all necessary steps to keep the Business Concept and Technology confidential until the formation of the Company, at which time the Founders shall further detail and define any confidentiality obligations.
5. DISPUTE RESOLUTION
5.1 Within one year of signature, if the Founders have not yet formed a Company, the Founders agree to discuss the benefits of continued collaboration related to the Business Concept and Technology and will discuss a mutually agreeable timetable for the formation of the Company.
5.2 In the event that the Founders do not wish to continue their mutual collaboration, the Founders shall discuss a mutually agreeable separation and division of assets of their collaboration. The Founders shall further define any and all confidentiality obligations related to the Business Concept and Technology. In no circumstance shall the underlying business concept be considered confidential upon termination of this Agreement.
5.3 In the event that the Founders are not able to agree to a mutually agreeable separation, the Founders agree to resolve the issue in the Norwegian court system. The Founders agree and acknowledge that all provisions of this agreement, including confidentiality provisions, shall be binding up through the end of this process. Costs of the process shall be borne equally by all Founders.
6. REPRESENTATIONS AND WARRANTIES
6.1 Each Founder represents and warrants that he or she is not a party to any other agreement that would restrict such Founder’s ability to perform its obligations as set forth in this Founder Agreement. Each Founder represents and warrants that no third party can claim any rights to any intellectual property or other proprietary right possessed by that Founder as it relates to the Business Concept and Technology.
6. CHOICE OF LAW
6.1 This Agreement shall be governed by and construed in accordance with Norwegian law. Any disputes that may arise from this Agreement shall be subject to the exclusive jurisdiction of the Norwegian courts with Oslo city court as agreed venue.
IN WITNESS WHEREOF, the Founders have signed this Agreement.
SCHEDULE 1: SHAREHOLDERS AGREEMENT
[Insert Company Shareholder Agreement here: ]
(Shareholder agreement is found here:
SCHEDULE 2: EMPLOYMENT AGREEMENT
Founders Agreement, Rev 1.0
[a]We suggest using the shareholders agreement in entrepedia.