Partnerships and founders
Founders' and partnership agreements: what to close before the relationship changes
Most partner disputes don't start with a fight. They start with something agreed verbally, or an MOU everyone treated as a draft.
Adv. Alex Blumin works with founders, partners and shareholders on agreements built around how the business actually runs: who brings what, who decides, and what happens when someone wants out.
What this practice covers
- 01Founders' agreements
- 02MOUs and term sheets between partners
- 03Shareholders' agreements (SHA)
- 04Holdings and dilution mechanisms
- 05Vesting and founder departure
- 06Decision-making and veto rights
- 07Exit mechanisms: BMBY, right of first refusal, tag and drag along
- 08Deadlock
- 09Board resolutions and corporate governance
Common scenario
An MOU that says "a detailed agreement will be signed within 60 days". Money comes in, the product gets built, and the detailed agreement keeps slipping. When the partnership breaks up, the MOU is the only binding document left.
When the partnership is already in dispute
A shareholder dispute is a commercial dispute like any other. We start from the documents already signed and from how the parties actually behaved.
How I work
Who brings what → who decides → how you exit. Then an agreement that says exactly that.
Related reading
Common questions
What must a founders' agreement include?
At least: holdings and what happens on dilution, what each founder contributes and for what, how decisions are made and who holds a veto, who owns the IP, and what happens when a founder leaves. The most forgotten clause is the exit mechanism, and it is exactly the one that decides a dispute.
Is an MOU between partners binding?
It can be, if it is specific enough and shows intent, even when it says a detailed agreement will follow. Conduct matters too: did you put money in, did you act as partners.
Business partnerships: what really matters before you start →What is the difference between an MOU and a full partnership agreement?
In principle the MOU sums up the principles and the full agreement details them. In practice, when the full agreement is never signed, the MOU becomes the only binding document. So draft it with the seriousness of a full agreement.
What happens when two equal partners disagree?
Without a tie-breaker agreed in advance, deadlock can paralyze the business. Decide up front who breaks the tie, on which issues, and what happens if there is no decision, for example an exit mechanism.
When should founders sign an agreement?
Before the money comes in and the product is built, while everyone still agrees. Once the relationship changes, every clause becomes a negotiation.
How do we reach out?
Write to me: who the partners are, what has been signed (if anything) and what stage the business is at. Don't send sensitive documents in the first message.
Contact →The information on this page is general information and does not constitute legal advice. For legal advice tailored to your case, please contact Adv. Alex Blumin.