Founders Agreement Drafting in Chennai India

Founders Agreement is the legal document that lays down the ownership, rights, and dispute resolution of co-founders. This is a crucial contract that needs to be executed before any business is established.

Having this drafted properly would ensure that the terms and conditions of the company are met without any litigation happening. It also helps to avoid the possibility of a business getting liquidated or dissolved and the monies belonging to the company being spent in an unsatisfactory manner.

It should also include details of the monetary contribution of each co-founder and the percentage of shares that they hold in the entity. This is a significant factor in the valuation of the business.

The Founders Agreement should also specify the rights of each co-founder to transfer their shareholding in the entity. This will be a valuable tool in dealing with the issue of co-founders seeking to exit the entity.

Founders Agreement Drafting Fees

A Lock-in Clause ordering the number of years before which co-founders cannot transfer their shareholding in the entity is an essential component of the Agreement. It will ensure that the co-founder does not sell his or her shares in the entity before the period is over and thus, avoids any conflict. The Fees for Founders Agreement drafting would range from Rs25,000/- to 75,000/-

Another aspect that should be included in the Founders Agreement is the provision of Non-compete clauses. This is to prevent the founders from engaging in any activity that would lead to competition in their employment.

This form of agreement should also include provisions regarding confidentiality. It is important for the founders to define what is confidential and how this information can be protected.