Founder Shares
Founder Shares are shares owned by a Founder Member, entitling them to participate in governance. Normally, only one Founder Share is issued to each person involved in the formation of the company.
From V3.0, the FairShares Rules Generator allows Founder shares to be renamed to 'Stewardship Shares', 'Entrepreneur Shares' or another label chosen by the Founders. The characteristics of the shares are identical.
Founder Shares are defined in Clause/Article 10(i) as follows:
- Founder Shares: issued at par value to the natural or legal persons who found the enterprise; non-transferable; one vote per shareholder at General Meetings (except as defined in Clauses/Articles 23 and 24); forfeited on holder's death, bankruptcy or insolvency; cancelled without payment on winding up.
Founder Shares become important when there is a Special Resolution as a majority of Founders must agree with the decision for it to be valid and binding.
In a FairShares Association, founders are just members and are not issued with share capital.
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