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Startup Equity Distribution Contract

Startup Equity Distribution Contract

THIS CONTRACT is made this [Month Day, Year] by and between [Your Company Name], [Your Company Address] and [Your Partner Company Name / Second Party], [Partner Company Address]. This agreement is intended to promote further collaboration and partnership between both parties regarding the distribution of equity within the startup.


This Startup Equity Distribution Contract (the "Agreement") is entered into by and between the parties identified above on the date specified above for the purpose of establishing the equity ownership and distribution among the founders of the Company.

Equity Allocation:

The initial equity distribution among the founders is as follows:

Founder Name

Equity Percentage (%)

Number of Shares

[Founder 1]



[Founder 2]

[Founder 3]

Vesting Schedule:

The equity shares allocated to each founder shall vest over a period of [Number] years, with a one-year cliff period, according to the following schedule:

Founder Name

Vesting Schedule

[Founder 1]

[Month Day, Year]

[Founder 2]

[Founder 3]

Rights and Responsibilities:

The founders agree to the following rights and responsibilities:

  1. Each founder shall have equal voting rights in matters pertaining to the Company.

  2. Founders shall diligently perform their roles and responsibilities as outlined in the Company's operating agreements.

  3. Transfer of equity shares to third parties shall require the prior written consent of all founders.

Dispute Resolution:

Any disputes arising under this Agreement shall be resolved through mediation conducted by a mutually agreed-upon mediator. If mediation fails to resolve the dispute, it shall be resolved through arbitration in accordance with the laws of [Jurisdiction].

Termination and Departure:

Should a founder voluntarily depart from the Company or face termination, any equity shares they may have that are left unvested are subject to forfeiture. Furthermore, the Company reserves the right to opt for the repurchase of any vested shares from the departing founder, with the value of such shares to be calculated according to the prevailing market rate at the time of repurchase.

Confidentiality and Non-Compete:

Founders agree to maintain the confidentiality of all proprietary information and trade secrets of the Company. Additionally, founders agree not to engage in any business activities that directly compete with the Company during the term of this Agreement.

Miscellaneous Provisions:

  • This Agreement constitutes the entire understanding between the parties and supersedes all prior agreements and understandings.

  • Any amendments or modifications to this Agreement shall be made in writing and signed by all parties.

  • If any provision of this Agreement is found to be invalid or unenforceable, the remaining provisions shall remain in full force and effect.


The parties hereto have executed this Agreement as of the date first above written.


[Printed Name of Founder 1]


[Printed Name of Founder 2]


[Printed Name of Founder 3]

[Company Name]



[Printed Name of Authorized Representative]

Title: [Title]

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