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Co-Founder Exit - Vesting & Acquisition intent Starting a Business

Discussion in 'Business & Corporate Matters' started by KatB, Jun 21, 2021.

  1. KatB

    KatB Law Topic Starter New Member

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    Jurisdiction:
    Delaware
    I have joined a startup as a co-founder and signed Founder Stock Purchase Agreement almost a year ago (vesting cliff of 1 year comes into effect in 4 days) and we agreed to 10-20-30-40 vesting. Due to a personal conflict with one of the co-founders and upon his request I chose to exit, this is in fact a forced exit without objective reasons. We have been discussing exit terms, which one of them was to grant me shares 10% vested amount plus 0.4%. The release has not happened yet and I am still in fact a co-founder and a Director. The third co-founder is neutral so far on the case. Yesterday the co-founder with whom I had a conflict informed me that the company was approached with an intent for an acquisition and he believes in "non-zero" chance of an acquisition before the end of the year. Now this changes things dramatically. With the acquisition (change of control) all the shares would vest automatically, which means I will have a lot more to gain if I don't exit now on the terms that I have agreed but not yet signed anything yet. Also because he took time with getting things ready my 10% shares are going to vest now anyway so I am not getting anything out of exiting. I am wondering what would be a reasonable thing to do within the framework of the laws of Delaware. Thanks a lot!
     
  2. adjusterjack

    adjusterjack Super Moderator

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    That's not a legal issue. It's a personal financial choice. But if you want to know how Delaware laws effect your situation, you should be talking to an attorney.
     
    hrforme likes this.
  3. KatB

    KatB Law Topic Starter New Member

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    Thanks. I thought this is the forum where I can consult a lawyer? My question is can I legally tell him now that I am not interested to exit anymore on the terms that were acceptable before he told me about this acquisition intent? Does he have legal rights to keep pushing for the original terms or can I walk away from them? Thanks!
     
  4. adjusterjack

    adjusterjack Super Moderator

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    Well, there's this thing at the top of the page for a free case review. Otherwise, please read the disclaimer at the bottom of the page. Lawyers and non-lawyers participate here to provide helpful information to posters, not to provide "legal advice."

    As far as I can tell from what you have written, you don't appear to have a binding agreement, oral or written, so you are free to tell him that you aren't leaving. He's free to huff and puff to his heart's content.
     
    KatB likes this.
  5. KatB

    KatB Law Topic Starter New Member

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    Many thanks!
     
  6. KatB

    KatB Law Topic Starter New Member

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    Hello! I have a follow up question - if there is an agreement with specified date saying "Effective Date" and there are no other dates in the contract, including no dates next to the signatures would this be the date of the contract's enforceability? The contract was signed via email exchange and the date that the second party signed was later than "Effective Date" that is explicitly written on the contract. Thanks!!
     
  7. cbg

    cbg Super Moderator

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    Contract review is beyond the scope of an internet forum.
     

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