Document background
The Startup Equity Agreement is a fundamental document used when Canadian startups issue shares to founders, investors, or employees. This agreement, governed by Canadian federal and provincial laws, is typically implemented during key company milestones such as initial incorporation, funding rounds, or employee equity compensation programs. The document must comply with the Canada Business Corporations Act or relevant provincial business corporations acts, as well as applicable securities regulations. A well-structured Startup Equity Agreement addresses critical aspects including share classes, voting rights, transfer restrictions, vesting schedules, and shareholder protections, while providing flexibility for future funding rounds and exit scenarios. It serves as a cornerstone document that establishes the relationship between the company and its shareholders while protecting all parties' interests.
