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Co Founder Exit Agreement Template for Canada

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Key Requirements PROMPT example:

Co Founder Exit Agreement

"I need a Co-Founder Exit Agreement for an amicable departure from my technology startup, where I'll be selling my 30% shareholding to the remaining founders but continuing as a technical advisor for 6 months until July 2025."

Document background
The Co-Founder Exit Agreement is a crucial document used when one of the founding members decides to leave a business venture in Canada. It's particularly important for protecting both the departing co-founder's interests and the company's future stability. This agreement becomes necessary during various scenarios, including voluntary departures, strategic disagreements, or retirement of a co-founder. The document addresses critical aspects such as share valuation and transfer, intellectual property rights, confidentiality obligations, and non-compete provisions, all while ensuring compliance with Canadian federal and provincial regulations. It's essential for managing risk, maintaining business continuity, and providing clear documentation of the separation terms. The agreement should be customized based on the specific circumstances of the exit, the company's structure, and the relevant provincial jurisdiction within Canada.
Suggested Sections

1. Parties: Identification of all parties to the agreement, including the exiting co-founder, remaining co-founders, and the company

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

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

4. Resignation and Release: Terms of the co-founder's resignation from all positions (director, officer, employee) and mutual releases

5. Share Transfer Terms: Details of the transfer or buyout of the exiting co-founder's shares, including pricing and payment terms

6. Consideration: Full details of the compensation package, including immediate payments, deferred payments, and any other financial considerations

7. Confidentiality: Ongoing obligations regarding confidential information and trade secrets

8. Non-Competition and Non-Solicitation: Restrictions on future competitive activities and solicitation of employees or customers

9. Intellectual Property: Assignment and confirmation of IP rights, including any ongoing rights or licenses

10. Tax Matters: Allocation of tax responsibilities and requirements for tax compliance

11. Representations and Warranties: Statements of fact and promises by all parties

12. General Provisions: Standard legal provisions including governing law, notices, amendments, and entire agreement clause

Optional Sections

1. Transition Services: Terms for any temporary transition period where the exiting co-founder continues to provide services

2. Ongoing Consultation: Terms for any ongoing advisory role or consultation arrangement

3. Employee Matters: Special provisions if the co-founder has unique employment relationships or teams reporting to them

4. Company Property: Specific provisions for return or retention of company property, equipment, or resources

5. Insurance and Benefits: Provisions regarding ongoing insurance coverage or benefits

6. Public Announcements: Terms governing how the exit will be communicated externally

7. Dispute Resolution: Specific procedures for resolving any future disputes

8. Earnout Provisions: Terms for any performance-based additional payments

Suggested Schedules

1. Schedule A - Share Details: Details of shares held, including class, number, and percentage ownership

2. Schedule B - Payment Schedule: Detailed schedule of all payments, including amounts and timing

3. Schedule C - Assets and IP: Comprehensive list of intellectual property and other assets affected by the exit

4. Schedule D - Resignation Letters: Form of resignation letters from various positions

5. Schedule E - Release Forms: Forms of mutual releases between parties

6. Schedule F - Retained Rights: Details of any rights retained by the exiting co-founder

7. Appendix 1 - Valuation Report: Independent valuation of shares or business interests being transferred

8. Appendix 2 - Tax Certificates: Required tax clearances or certificates

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

Professional Services

Manufacturing

Retail

Financial Services

Healthcare

Media and Entertainment

E-commerce

Consulting

Software Development

Biotechnology

Real Estate

Energy

Transportation

Relevant Teams

Legal

Finance

Human Resources

Board of Directors

Executive Leadership

Corporate Governance

Tax

Compliance

Corporate Communications

Operations

Relevant Roles

CEO

Managing Director

Company Secretary

Chief Legal Officer

Corporate Lawyer

CFO

Board Member

Director

Founder

Co-Founder

General Counsel

Head of Legal

Corporate Governance Officer

Chief Operations Officer

HR Director

Tax Director

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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