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Co Founder Separation Agreement Template for Australia

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Key Requirements PROMPT example:

Co Founder Separation Agreement

"I need a Co-Founder Separation Agreement for a technology startup where I'm the departing founder, transferring 25% shareholding back to the company, and need to include specific provisions about the AI technology I developed while maintaining some ongoing consulting arrangements for 6 months post-departure in March 2025."

Document background
The Co-Founder Separation Agreement is a critical legal instrument used when one or more co-founders decide to part ways with a business entity in Australia. This document becomes necessary when founders choose to separate due to various circumstances such as strategic disagreements, personal reasons, or pursuit of different opportunities. It comprehensively addresses key aspects including ownership restructuring, intellectual property rights, confidentiality obligations, and post-separation responsibilities, while ensuring compliance with Australian corporate law, particularly the Corporations Act 2001 (Cth) and relevant state legislation. The agreement helps prevent future disputes by clearly documenting the terms of separation, financial settlements, and ongoing obligations, while protecting the interests of both the departing co-founder and the continuing business.
Suggested Sections

1. Parties: Identification of all parties to the agreement, including the departing co-founder, remaining co-founder(s), and the company

2. Background: Context of the co-founder relationship, business structure, and reason for separation

3. Definitions: Definitions of key terms used throughout the agreement

4. Effective Date and Transition Period: Specification of when the separation takes effect and any transition period arrangements

5. Resignation and Role Cessation: Terms of the co-founder's resignation from all positions (director, officer, employee, etc.)

6. Share Transfer and Consideration: Details of any share transfers, including timing, pricing, and payment terms

7. Intellectual Property Rights: Assignment and retention of IP rights, including developed technology and confidential information

8. Confidentiality Obligations: Ongoing confidentiality requirements and handling of sensitive information

9. Non-Compete and Non-Solicitation: Restrictions on future competitive activities and solicitation of employees/clients

10. Mutual Release: Release of claims between parties, subject to agreement terms

11. Representations and Warranties: Standard representations regarding authority, ownership, and compliance

12. Tax Matters: Handling of tax obligations and liabilities

13. Dispute Resolution: Process for resolving any disputes arising from the agreement

14. General Provisions: Standard boilerplate clauses including governing law, notices, and amendments

Optional Sections

1. Ongoing Consulting Arrangement: Terms of any continuing consulting relationship with the departing co-founder

2. Employee Matters: Required when the co-founder was also an employee, addressing employment termination and benefits

3. Client Transition: Needed when the departing co-founder had significant client relationships that need transitioning

4. Outstanding Loans and Debts: Required when there are outstanding loans or debts between the parties

5. Board Observer Rights: Optional provisions for ongoing board observation rights for the departing co-founder

6. Earnout Provisions: Used when part of the separation payment is contingent on future performance

7. Public Relations and Communications: Required when public announcement of the separation needs coordination

8. Ongoing Technology Support: Needed when the departing co-founder needs to provide technical support post-separation

Suggested Schedules

1. Schedule A - Share Transfer Details: Detailed breakdown of shares being transferred, including class, number, and certificate numbers

2. Schedule B - Payment Terms: Detailed payment schedule, including amounts, dates, and payment methods

3. Schedule C - Intellectual Property Inventory: Comprehensive list of IP assets and their disposition

4. Schedule D - Company Assets and Resources: List of company assets to be returned or retained

5. Schedule E - Ongoing Obligations: Detailed list of any continuing obligations or responsibilities

6. Appendix 1 - Resignation Letters: Form of resignation letters from various positions

7. Appendix 2 - Share Transfer Forms: Required share transfer documentation

8. Appendix 3 - Release Deed: Formal deed of release between parties

Authors

Alex Denne

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

Relevant legal definitions







































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Relevant Industries

Technology

Startups

Professional Services

Financial Services

E-commerce

Healthcare

Software Development

Manufacturing

Retail

Consulting

Media and Entertainment

Biotechnology

Real Estate

Education Technology

Relevant Teams

Legal

Executive Leadership

Board of Directors

Human Resources

Finance

Compliance

Corporate Governance

Operations

Strategy

Administrative

Relevant Roles

Co-Founder

Chief Executive Officer

Managing Director

Company Director

Chief Technology Officer

Chief Financial Officer

Chief Operating Officer

Company Secretary

General Counsel

Legal Counsel

Corporate Lawyer

HR Director

Board Member

Compliance Officer

Chief Strategy Officer

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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