Document background
The Founder Shareholder Agreement is a critical document used when establishing a new company or formalizing the relationship between existing founding shareholders in the Philippines. It becomes particularly important in startup formations, joint ventures, or when multiple founders are involved in establishing a business. The agreement, governed by Philippine corporate law, specifically the Corporation Code and related regulations, details the founders' rights, responsibilities, and obligations, including share ownership, management participation, decision-making processes, and exit mechanisms. It addresses key aspects such as share transfer restrictions, pre-emptive rights, and dispute resolution procedures, while ensuring compliance with local regulatory requirements, including foreign ownership restrictions where applicable. This document serves as the cornerstone of corporate governance among founders and provides a clear framework for managing their relationship throughout the company's lifecycle.
