Document background
The Co-Founder Equity Agreement is a critical document used when establishing or formalizing a business relationship between two or more founders in the Philippines. It becomes necessary when multiple individuals come together to start a company and need to clearly define their ownership stakes, responsibilities, and rights. This agreement must comply with Philippine corporate law, particularly the Revised Corporation Code and Securities Regulation Code, and typically includes provisions for equity distribution, vesting schedules, voting rights, transfer restrictions, and exit mechanisms. The document serves as a crucial risk management tool by preventing potential disputes and misunderstandings between founders, while also providing clarity to future investors about the company's ownership structure and governance.
