Co Founder Agreement for Australia

Co Founder Agreement Template for Australia

A comprehensive legal agreement governed by Australian law that establishes the formal relationship between two or more co-founders of a business venture. This document outlines crucial elements including equity distribution, roles and responsibilities, decision-making processes, intellectual property rights, and exit provisions. It serves as the foundational document for the business relationship, incorporating relevant provisions from the Corporations Act 2001 and other applicable Australian legislation, while establishing clear frameworks for dispute resolution and business governance.

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What is a Co Founder Agreement?

The Co-Founder Agreement is a critical legal document used when two or more individuals come together to establish and operate a business venture in Australia. This agreement should be implemented at the earliest stages of business formation, ideally before or concurrent with company registration. It provides a comprehensive framework covering equity arrangements, founder responsibilities, intellectual property rights, decision-making processes, and exit strategies. Operating under Australian jurisdiction, it must comply with the Corporations Act 2001 and related legislation, while addressing specific requirements of the Australian business environment. The agreement helps prevent future disputes by clearly documenting all aspects of the co-founder relationship, protecting each party's interests, and establishing clear protocols for business operations and potential contingencies.

What sections should be included in a Co Founder Agreement?

1. Parties: Identifies and provides full details of all co-founders entering into the agreement

2. Background: Sets out the context of the agreement, including the business concept and purpose of the arrangement

3. Definitions: Defines key terms used throughout the agreement

4. Roles and Responsibilities: Outlines each founder's position, duties, and areas of responsibility within the business

5. Equity Structure: Details the initial shareholding split and any vesting arrangements

6. Capital Contributions: Specifies initial and ongoing financial contributions from each founder

7. Decision Making: Establishes voting rights and processes for key business decisions

8. Intellectual Property: Addresses ownership and assignment of IP created before and during the business

9. Confidentiality: Defines confidential information and establishes protection obligations

10. Non-Competition and Non-Solicitation: Sets out restrictions on competing activities and poaching of employees/clients

11. Termination: Specifies circumstances and processes for ending the co-founder relationship

12. Exit Provisions: Details processes for share transfers, founder departure, and company sale

13. Dispute Resolution: Establishes procedures for resolving disagreements between founders

14. General Provisions: Includes standard boilerplate clauses, governing law, and interpretation

What sections are optional to include in a Co Founder Agreement?

1. Employment Terms: Required if founders will be employees of the company, detailing employment conditions and remuneration

2. External Activities: Needed if founders will maintain other business interests or employment

3. Founder Illness/Incapacity: Addresses management of founder's interests in case of long-term illness or incapacity

4. Anti-Dilution Protection: Includes provisions protecting founders from equity dilution in future funding rounds

5. Tag-Along/Drag-Along Rights: Required for companies planning future investment or exit opportunities

6. Death Benefits: Specifies handling of deceased founder's interests and any death benefits

7. Family Involvement: Needed if family members will be involved in the business

8. International Operations: Required for businesses planning to operate across multiple jurisdictions

What schedules should be included in a Co Founder Agreement?

1. Business Plan: Detailed business plan including market analysis, strategy, and financial projections

2. Shareholding Structure: Detailed breakdown of share classes, numbers, and ownership percentages

3. Vesting Schedule: Specific terms and timeline for equity vesting arrangements

4. IP Register: List of existing intellectual property brought into the business by each founder

5. Initial Capital Contributions: Detailed list of cash and non-cash contributions from each founder

6. Founder Resumes: Professional backgrounds and qualifications of each founder

7. Key Performance Indicators: Metrics for measuring founder performance and business success

8. Company Policies: Essential operational policies and procedures

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Australia

Publisher

Genie AI

Document Type

Agreement Contract

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Technology

E-commerce

Financial Services

Healthcare

Professional Services

Manufacturing

Media and Entertainment

Education Technology

Biotechnology

Clean Energy

Real Estate

Retail

Software Development

Consulting

Food and Beverage

Relevant Teams

Legal

Executive

Corporate Governance

Administration

Finance

Human Resources

Business Development

Operations

Strategy

Compliance

Relevant Roles

Chief Executive Officer

Chief Technology Officer

Chief Financial Officer

Chief Operating Officer

Managing Director

Company Director

Founder

Co-Founder

Managing Partner

Executive Director

Head of Legal

General Counsel

Company Secretary

Business Development Director

Startup Founder

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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