Founders' Agreement
Aligns co-founders on equity, roles, vesting, decision-making and exit before things get complicated — the document every startup should sign early.
Editable agreementFOUNDERS' AGREEMENT
This Founders' Agreement ("Agreement") is entered into on [DD/MM/YYYY] among the following founders (each a "Founder", collectively the "Founders") in relation to [COMPANY / VENTURE NAME] ("Company"):
1. [FOUNDER 1 NAME], residing at [ADDRESS];
2. [FOUNDER 2 NAME], residing at [ADDRESS];
3. [FOUNDER 3 NAME], residing at [ADDRESS].
1. BUSINESS
The Founders agree to carry on the business of [DESCRIBE BUSINESS] through the Company.
2. EQUITY & CAPITAL
The equity of the Company shall be held as follows: [FOUNDER 1] — [X]%, [FOUNDER 2] — [Y]%, [FOUNDER 3] — [Z]%. Each Founder shall contribute capital / sweat equity as set out in Annexure A.
3. ROLES & RESPONSIBILITIES
[FOUNDER 1] — [ROLE, e.g. CEO]; [FOUNDER 2] — [ROLE]; [FOUNDER 3] — [ROLE]. Each Founder shall devote [full-time] effort to the Company.
4. VESTING
Founder equity shall vest over [FOUR (4)] years with a [ONE (1)] year cliff. Unvested shares of a Founder who leaves shall be subject to buy-back at [fair value / par].
5. DECISION-MAKING
Ordinary matters shall be decided by majority. Reserved matters (fundraising, sale, new business lines, borrowing above [INR AMOUNT]) require [unanimous / super-majority] consent.
6. INTELLECTUAL PROPERTY
All IP created by any Founder in connection with the business shall belong to the Company.
7. TRANSFER OF SHARES & ROFR
No Founder shall transfer shares without first offering them to the other Founders (Right of First Refusal). Standard tag-along and drag-along rights apply.
8. LEAVER PROVISIONS
A Founder who ceases involvement shall be treated as a "Good Leaver" or "Bad Leaver" as defined in Annexure B, determining their entitlement to vested shares.
9. CONFIDENTIALITY & NON-COMPETE
Each Founder shall maintain confidentiality and shall not compete with the Company during their involvement and for [ONE (1)] year thereafter.
10. DISPUTE RESOLUTION
Disputes shall be resolved by arbitration under the Arbitration and Conciliation Act, 1996, seated at [CITY].
11. GOVERNING LAW
This Agreement is governed by the laws of India.
IN WITNESS WHEREOF, the Founders have executed this Agreement.
_____________________ _____________________ _____________________
[FOUNDER 1] [FOUNDER 2] [FOUNDER 3]Using this template as part of setting up or running your business? We also handle Private Limited Company Registration — done properly, the first time.
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Disclaimer: This template is a general draft provided for convenience and does not constitute legal advice. Replace all [BRACKETED] placeholders and have important contracts reviewed by a qualified CA/CS or lawyer before signing. Company Avenue Advisory accepts no liability for its use as-is.