The items typically included in a founders’ agreement are shown in Table 7.4.
An important issue addressed by most founders’ agreements is what
happens to the equity of a founder if the founder dies or decides to leave the
firm. Most founders' agreements include a buyback clause, which legally
obligates departing founders to sell to the remaining founders their interest
in the firm if the remaining founders are interested.” In most cases, the
agreement also specifics the formula for computing the dollar value to be
paid. The presence of a buyback clause is important for at least two reasons.
First, if a founder leaves the firm, the remaining founders may need the