Why does my spouse have to sign my founder stock agreement?

Question

Accepted Answer

Because in a community property state, property either spouse acquires during the marriage generally belongs to both of them, and that includes shares issued to a founder. If half of your stock is your spouse's, then a restricted stock agreement only you have signed binds only half the stock. A spousal consent is a short signature page in which the spouse acknowledges the agreement, agrees that its vesting, repurchase and transfer restrictions apply to any interest they have in the shares, and agrees that you act for both of you in dealings with the company. Which states The IRS lists nine community property states: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin. Several other states, Alaska, Florida, South Dakota and Tennessee among them, let married couples opt into a community property arrangement by agreement or trust. Many formation packets ask every married founder for the consent whatever the state, because founders move and the company would rather not track which of them has. What the consent does and does not do It does not make your spouse a stockholder, give them a vote, or put their name on the ledger. What it prevents is the situation the company most wants to avoid: a divorce that produces a stockholder the company never chose, holding shares the company thought it could buy back, and free of the transfer restrictions everyone else signed. The consent settles in advance that whatever interest the spouse has follows the same rules as yours. If you are not married, the agreement usually asks you to say so rather than skip the page. If you marry later, the consent can be signed then, and a company doing a financing will often ask for it at that point if it was missed.

Why does my spouse have to sign my founder stock agreement?

Which states

What the consent does and does not do

Related questions