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DemoMeet Northfield Technologies. Follow their story from co-founder agreement to first hire — and see exactly what Cofora catches along the way.
January 2026 — Austin, TX
Aria Chen had been building quietly for eight months before Marcus Webb came in through a mutual contact. He'd spent five years selling enterprise software to construction firms and knew every pain point Aria was building toward. Within weeks of their first meeting, they decided to build Northfield Technologies together.
They drafted their co-founder agreement themselves. It seemed straightforward — split the equity, define the roles, add a vesting schedule. What they didn't realize was that the agreement they signed would become the foundation everything else was built on. And some of that foundation had cracks.
Source Document
Read OnlyCO-FOUNDER AGREEMENT
Northfield Technologies, Inc.
This Co-Founder Agreement ("Agreement") is entered into as of January 15, 2026, by and between:
Aria Chen ("Chen"), residing in Austin, Texas, and
Marcus Webb ("Webb"), residing in Austin, Texas.
Collectively referred to as the "Founders."
1. COMPANY FORMATION
1.1 The Founders shall incorporate Northfield Technologies, Inc. as a corporation under the laws of the State of Texas within thirty (30) days of the date of this Agreement.
1.2 The Company's principal place of business shall be Austin, Texas.
2. EQUITY OWNERSHIP
2.1 Upon incorporation, the total authorized shares shall be 10,000,000 shares of common stock.
2.2 Shares shall be allocated as follows:
- Aria Chen: 5,500,000 shares (55%)
- Marcus Webb: 4,500,000 shares (45%)
2.3 The shares described in Section 2.2 shall be issued to the Founders upon incorporation.
3. VESTING SCHEDULE
3.1 Shares shall be subject to the following vesting schedule:
- Total vesting period: 4 years
- Cliff period: 6 months
- Following the cliff, shares vest in equal monthly installments over 42 months
3.2 In the event a Founder voluntarily resigns or is terminated, unvested shares shall be forfeited.
3.3 The Company shall have the right to repurchase unvested shares at $0.001 per share upon departure.
3.4 There shall be no acceleration of vesting upon any event including change of control or acquisition.
4. ROLES AND RESPONSIBILITIES
4.1 Aria Chen shall serve as Chief Technology Officer, responsible for product development and technical operations.
4.2 Marcus Webb shall serve as Chief Executive Officer, responsible for business development, sales, and fundraising.
4.3 Each Founder shall devote substantially all of their professional time to the Company.
4.4 Major decisions shall require the mutual agreement of both Founders.
5. INTELLECTUAL PROPERTY
5.1 Each Founder assigns to the Company all intellectual property created in connection with the Business from the date of this Agreement forward.
5.2 Each Founder agrees to execute additional documents to effectuate this assignment.
5.3 Aria Chen's software code developed prior to this Agreement shall be licensed to the Company on a royalty-free, perpetual basis, but ownership shall remain with Aria Chen unless separately agreed in writing.
6. CONFIDENTIALITY
6.1 Each Founder agrees to keep confidential all non-public information relating to the Company.
6.2 This confidentiality obligation shall survive termination for two (2) years.
7. NON-COMPETE AND NON-SOLICITATION
7.1 During the term, neither Founder shall engage in directly competing business activity without written consent.
7.2 For twelve (12) months post-departure, neither Founder shall solicit Company employees.
7.3 For six (6) months post-departure, neither Founder shall solicit Company customers they had material contact with.
8. DECISION MAKING
8.1 Routine decisions within each Founder's area may be made unilaterally.
8.2 The following require mutual written consent:
- Raising capital exceeding $100,000
- Hiring employees with compensation exceeding $75,000
- Contracts exceeding $25,000
- Sale of material assets
8.3 If Founders cannot agree, the matter shall be tabled for thirty (30) days, then mediation.
8.4 If mediation fails, either Founder may require binding arbitration in Austin, Texas.
9. CAPITAL CONTRIBUTIONS
9.1 Each Founder shall contribute $5,000 in initial capital.
9.2 Neither Founder shall be required to make additional contributions.
10. COMPENSATION
10.1 Neither Founder shall receive a salary until the Company raises at least $250,000.
10.2 Following that threshold, salaries shall be determined by mutual agreement.
11. TRANSFER RESTRICTIONS
11.1 No Founder may transfer shares without prior written consent of the other Founder.
11.2 The Company shall have right of first refusal on any proposed share transfer.
12. TERM AND TERMINATION
12.1 This Agreement commences on the date above and continues until terminated.
12.2 This Agreement may be terminated by mutual written consent.
12.3 Sections 5, 6, 7, and 11 survive termination.
13. GENERAL PROVISIONS
13.1 Governing Law: State of Texas.
13.2 This Agreement constitutes the entire agreement between the Founders.
IN WITNESS WHEREOF, the Founders have executed this Agreement as of January 15, 2026.
Aria Chen Marcus Webb
Signature: ___________ Signature: ___________
Date: January 15, 2026 Date: January 15, 2026High Risk
Summary
This co-founder agreement between Aria Chen and Marcus Webb for Northfield Technologies has a solid foundation — clear equity split, defined roles, and a deadlock resolution process — but contains several high-risk gaps that could seriously harm both founders. The most critical issue is that Aria Chen's pre-existing software IP is only licensed (not assigned) to the company, which will alarm investors and creates existential risk for Northfield Technologies. Additionally, the 6-month vesting cliff is non-standard, vesting acceleration is explicitly excluded, and the departure/termination provisions lack the specificity needed to protect either founder in a dispute.
Category Overview
Agreement Strengths
- •Clear 55/45 equity split between Aria Chen and Marcus Webb avoids the 50/50 deadlock trap and reflects differentiated contributions — this is a thoughtful allocation.
- •Well-structured decision-making framework in Section 8 with specific dollar thresholds for major decisions ($100,000 for fundraising, $75,000 for hires, $25,000 for contracts) rather than vague "material" language.
- •Deadlock resolution process (30-day cooling period → mediation → binding arbitration in Austin, TX) is a strong foundation — most co-founder agreements omit this entirely.
- •Section 4.3 establishes full-time commitment from both founders, and Sections 4.1–4.2 clearly delineate CTO (Aria Chen) and CEO (Marcus Webb) roles with specific responsibility areas.
- •Transfer restrictions in Section 11 include both consent requirements and right of first refusal, providing baseline protection against unwanted share transfers.
- •Compensation provisions in Section 10 set a clear funding threshold ($250,000) before salaries begin, aligning founder incentives with company milestones.
- •Non-solicitation provisions in Section 7 cover both employees (12 months) and customers (6 months with a "material contact" qualifier), which is well-crafted and likely enforceable under Texas law.
- •Section 9 establishes equal initial capital contributions ($5,000 each) with explicit language that no additional contributions are required — preventing future disputes about funding obligations.
Fix Critical Gaps Instantly2 Critical
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Gap Analysis by Priority
Pre-Existing IP Licensed, Not Assigned
Issue: Section 5.3 states that Aria Chen's pre-existing software code is only licensed to Northfield Technologies, with ownership remaining with Aria Chen. For a technology/SaaS company, the core software IS the company.
Impact: 1) Investor dealbreaker: No institutional investor will fund Northfield if core IP is owned personally by a founder. 2) Acquisition risk: Any acquirer will require IP ownership, not a license. 3) Founder leverage: If Aria departs acrimoniously, she retains ownership of core software and could license it to a competitor. 4) The license lacks critical terms: it doesn't specify exclusivity, sublicensing rights, or coverage of derivative works.
Fix: Replace Section 5.3 with a full IP assignment. Aria Chen irrevocably assigns all pre-existing IP to Northfield Technologies, with a Schedule A inventory listing all repositories, documentation, and design assets. The equity split (55/45) reflects in part the value of this contribution.
Fix This GapNo 'For Cause' Termination Definition
Issue: Section 12 addresses termination but provides no definition of what constitutes termination 'for cause.' Section 3.2 references a Founder being 'terminated' but does not distinguish between termination for cause, without cause, or voluntary resignation.
Impact: Without a clear definition, either founder could be forced out with no agreed standard for what justifies removal. A founder engaging in genuinely harmful behavior cannot be cleanly removed. This gap virtually guarantees litigation if either founder is pushed out.
Fix: Add Section 12.4 defining termination for cause (felony conviction, willful misconduct, material breach, fraud, embezzlement) and Section 12.5 establishing Good Leaver / Bad Leaver treatment with distinct equity outcomes for each departure scenario.
Fix This GapNo 83(b) Election Requirement
Issue: Sections 2 and 3 describe share issuance subject to vesting but make no mention of IRS Section 83(b) elections. Each founder must file an 83(b) election within 30 days of receiving shares to avoid potentially catastrophic tax consequences.
Impact: If Aria Chen or Marcus Webb fail to file an 83(b) election within 30 days of share issuance, they will owe ordinary income tax on the fair market value of shares as they vest — potentially hundreds of thousands of dollars if the company appreciates in value.
Fix: Add Section 2.4 requiring each Founder to file an 83(b) election within thirty (30) days of share issuance and provide a copy to the Company. The Company should not issue shares until each Founder has confirmed intent to file.
Fix This GapNo Vesting Acceleration on Change of Control
Issue: Section 3.4 explicitly states there shall be no acceleration of vesting upon any event including change of control or acquisition. This is unusually restrictive and disadvantageous to both Aria Chen and Marcus Webb.
Impact: If Northfield Technologies is acquired while either founder has unvested shares, and the acquirer terminates them — a very common occurrence — the terminated founder forfeits all unvested equity with no recourse. This provision gives an acquirer a financial incentive to fire founders post-acquisition.
Fix: Replace Section 3.4 with a double-trigger acceleration provision: unvested shares vest if a founder is terminated without cause or resigns for good reason within twelve months following a change of control.
Fix This GapDeadlock Resolution Lacks Final Mechanism
Issue: The agreement establishes a deadlock process (30-day cooling → mediation → arbitration) but no final buy-sell mechanism. An arbitrator cannot make strategic business decisions for the founders.
Impact: With only two founders, deadlocks are inevitable. If they disagree on a fundamental strategic question — acquisition offer, pivot, dissolution — arbitration may not provide a satisfactory resolution and the company could be paralyzed for months.
Fix: Add a buy-sell (shotgun) provision as Section 8.6: either founder may offer to buy the other out at a stated price, and the receiving founder must either accept or reverse the offer at the same price within 60 days.
Fix This GapNo Board of Directors Governance Structure
Issue: The agreement does not establish a Board of Directors, define board composition, or outline how governance will evolve when investors come on board.
Impact: When Northfield raises its first round, investors will demand board seats. Without pre-planning, the founders may lose board control earlier than necessary or disagree about composition during a time-sensitive fundraising process.
Fix: Add Section 8.7 establishing a two-person initial board (Aria Chen and Marcus Webb), with a provision to add one independent director within 12 months or at first equity financing as a tie-breaking vote.
Fix This GapNo Pre-Existing IP Schedule or Inventory
Issue: Section 5.3 references Aria Chen's software code but includes no schedule or inventory of what this IP consists of — no repository names, modules, or documentation.
Impact: Without an inventory, there is no way to determine the boundary between IP owned by Aria Chen personally and IP created for Northfield after the agreement date. This ambiguity will cause problems during investor due diligence.
Fix: Add Schedule A with a complete inventory of pre-existing IP: repository names, hosting platforms, languages, documentation, design assets, domain names, and any third-party dependencies.
Fix This GapNo Drag-Along or Tag-Along Rights
Issue: Section 11 includes transfer restrictions and right of first refusal, but no drag-along rights (allowing majority to force minority into a sale) or tag-along rights (allowing minority to join a majority sale).
Impact: Without drag-along: Marcus Webb (45%) could block an acquisition Aria Chen (55%) wants to proceed with. Without tag-along: If Aria sells her 55% stake, Marcus has no right to participate on the same terms and could be left as a minority shareholder with a new majority owner he didn't choose.
Fix: Add Section 11.4 (drag-along: majority can compel minority to join a company sale on identical terms) and Section 11.5 (tag-along: minority can join any majority sale of more than 25% of shares on identical terms).
Fix This Gap→ Recommended Next Steps
- 1.IMMEDIATE — Fix the pre-existing IP issue (Section 5.3): Aria Chen's core software must be assigned to Northfield Technologies, not merely licensed. Create Schedule A with a detailed IP inventory. Consult a Texas IP attorney before finalizing.
- 2.IMMEDIATE — Add 'for cause' termination definition and good leaver/bad leaver provisions (Section 12). Without these, any founder departure will likely result in litigation.
- 3.BEFORE SIGNING — Add double-trigger vesting acceleration (Section 3.4). The current blanket prohibition on acceleration is harmful to both founders. At minimum, add acceleration upon change of control + termination without cause.
- 4.BEFORE SIGNING — Extend the vesting cliff from 6 months to the industry-standard 12 months (Section 3.1). This protects both founders from a co-founder who leaves too early.
- 5.BEFORE SIGNING — Add 83(b) election requirement (Section 2). Both founders must file within 30 days of share issuance. Missing this deadline is irreversible and can cost hundreds of thousands in taxes.
- 6.WITHIN 30 DAYS — Add drag-along and tag-along rights to Section 11 to protect both founders in any future sale scenario.
- 7.WITHIN 30 DAYS — Establish initial Board of Directors structure with a plan for adding an independent director as tie-breaker.
- 8.CONSULT ATTORNEY — Have a Texas corporate attorney review the entire agreement with focus on: IP assignment structure, 83(b) election mechanics, non-compete enforceability under Texas Business & Commerce Code § 15.50, and compliance with the Texas Business Organizations Code.
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