Founders sign the formation documents and move on. Those same documents decide who makes decisions, who can be fired, and what holds up when the company is sold. BKK Roundtable is a video series from Bean, Kinney & Korman where attorneys from different practices work the same problem at one table. One set of facts, handed from practice to practice, so you can see exactly where the answers diverge. The company is formed. Nothing has been written down about how the founders own it. Bean, Kinney & Korman attorneys Maureen E. Carr, Evan St. John and Jennifer O. Schiffer pick the story up from there. Evan sets out which organizational documents each entity type needs: bylaws plus a shareholders agreement for a corporation, an operating agreement for an LLC. Jennifer explains what those documents have to decide once there are two owners, why the firm's standing advice is to avoid a 50/50 split, and what to settle in writing when founders go forward 50/50 anyway. Maureen takes up whether the founders need employment agreements of their own, where restrictive covenants belong, and whether a founder should commit to a set term or stay at will. When the two describe the same departure differently, Jennifer explains, the ownership documents control, so a founder you can fire as an employee may still be an owner the next morning, drawing profits and in some cases voting. Evan and Maureen close on where that leaves the paperwork: restrictive covenants can sit in both documents at once and operate independently, the version in the ownership documents is often the one that holds up in a sale, and that is why a non-compete there can run five years while the employment agreement carries one or two. "As attorneys, our general recommendation is don't be 50-50 owners if you can at all help it. But I would say most of our clients ignore that advice and go forward as 50-50 owners."