Practice
Start: forming the company
The cheapest time to agree is before there's anything to argue about. We form the company and write down how its owners will run it.
What we do
- Choose the entity with you and your accountant: LLC, S corporation or C corporation
- File the formation papers and the tax registrations that follow
- Write the operating or shareholder agreement: ownership, votes, vesting and pay
- Set out what happens when an owner leaves, dies, divorces or wants to sell
- Paper the first hires, contractors and the intellectual property they create
How it goes
A first meeting with every owner in the room, because the agreement is theirs, not ours. A written fee before any work starts. A draft within two weeks, read through together line by line, and a signed set for each owner.
Later on
Companies change. When an owner joins or leaves, or a new investor asks for terms, we reopen the agreement we wrote rather than starting from a stranger's.
Sample matters
Agreed before it mattered
Decide the exit on day one.
Signed in three weeks
Two brothers forming a roofing company: an LLC, an operating agreement with a buy-sell formula, and life insurance to fund it.
Sweat equity needs a schedule.
Ownership settled
A software founder bringing on a technical co-founder, with four-year vesting and a one-year cliff written into the agreement.
Sample matters, written as illustrations for this template. Every matter is different, and past results don't guarantee a similar outcome.
Questions owners ask
LLC or corporation?
It depends on how the owners want to be taxed, whether you'll take outside investment and how you'll pay yourselves. We decide it with your accountant at the first meeting, not from a chart.
Do two owners really need an operating agreement?
Two owners need one most. Without it, a deadlock between equal owners has no way out except a lawsuit.
Can you fix an agreement we wrote ourselves?
Yes. Bring it. We'll mark what it does and doesn't cover, and quote the cost of the changes before we make them.