Founder vesting and lock-in under Norwegian law

The risk vesting exists to cover

A founder who leaves in the first year with a quarter of the company takes that quarter with them. The default in Norwegian company law is that shares may be sold or kept freely unless law, the articles or an agreement between the shareholders provides otherwise (aksjeloven § 4-15). A departure changes nothing in the share register.

The remaining founders do the work while sharing the returns with someone who has left. The next investor must value a company where a quarter of the equity belongs to someone who no longer contributes. Your own position is diluted by whatever it takes to rebuild the team.

Norway has no statutory vesting regime. Everything that protects you against this is contracted, and the contract is the shareholders’ agreement (aksjonæravtale).

Reverse vesting in a Norwegian AS

Founders in an AS hold their shares from incorporation, fully paid and registered. Vesting therefore runs in reverse: the founder agrees in the shareholders’ agreement to sell shares back if they leave, and the number of shares subject to that obligation falls over time until none remain.

The alternative, issuing the founder’s shares in tranches as they are earned, needs a general-meeting resolution and a capital increase for every tranche and leaves the founder without their voting weight in the meantime. The reverse form is what Norwegian practice uses.

Simonsen Vogt Wiig describe time-based vesting agreements for founder shares as used most commonly in early-stage companies: unvested shares face a mandatory sale on bad-leaver terms, vested shares stay subject to sale obligations on good-leaver terms, and both sit inside transfer restrictions and a lock-in period (bindingstid).

The schedule itself, its length, any cliff before the first release, and whether anything accelerates on an exit, is negotiated in each deal. Set it against the runway, because a schedule that ends before the money runs out protects nobody for the period that matters.

Good leaver, bad leaver

Check that the leaver clause settles the events that trigger a sale, the price and the buyer. Leaving any of these open creates a dispute when a founder leaves.

The agreed price is particularly vulnerable to challenge. Where the statute itself prices a compelled exit it uses fair value (virkelig verdi), read as market value on refused consent (aksjeloven § 4-17) and as the shares’ proportionate share of the company’s underlying value, normally without a minority discount, on a court-ordered redemption (§ 4-24).

A shareholders’ agreement may pre-agree a formula that departs from that, and the formula is valid as contract. It can be set aside or revised as unreasonable under avtaleloven § 36.

The risk of challenge increases as the price falls further below fair value, the leaver’s fault becomes less serious or the good- and bad-leaver definitions become more unbalanced. A forfeiture that works as a penalty on a blameless leaver is the most exposed form.

Employment sharpens that scrutiny without moving the clause into employment law. Shares held as an investment stay in company and contract law, but a forfeiture triggered by the ending of employment, and functioning as a penalty on it, is looked at harder.

In HR-2025-251-A (12 February 2025), the Supreme Court considered a settlement reducing the unpaid purchase price owed to four former co-founders to 30 per cent. Material information about negotiations with an outside investor was withheld. The company was subsequently sold at twice the valuation underlying the original share purchase.

The settlement was set aside in full. The sellers were entitled to the original purchase price, less what they had already received, with the agreed interest. The Court emphasised the withheld information, the parties’ unequal knowledge and resources, and the loyalty obligations arising from their previous dealings. The judgment does not decide whether a particular good-leaver or bad-leaver formula is valid.

Set against it, Borgarting lagmannsrett in LB-2021-56870 (21 April 2022) refused to unwind a completed share purchase. The claim rested solely on events after completion, and the conduct relied on was largely directed at others than the party from whom adjustment was sought.

The unfairness § 36 tests lies in enforcing the agreement, and for a completed purchase that means only the buyer keeping shares it already owns.

The cases distinguish defects at formation from other reasons for revising a commercial agreement; they do not exclude later events from § 36. Sophistication, bargaining strength and the source of the alleged unfairness remain relevant. Neither cited case decides the leaver formula here, so assess that clause on its own facts.

The buyback mechanics

The clause gives a right to acquire the shares. Company law decides how the acquisition can be executed, and the three routes carry different constraints.

Plan any articles-based redemption before the founder shares are issued. The creditor-notice exemption in § 12-7 requires the redemption rule to be registered no later than issuance and also limits distributions. Adding a compulsory-redemption obligation to existing shares requires the consent of all affected holders under § 5-20; it does not retroactively satisfy the registration timing condition.

In most angel deals the first route is the one that will run, so check that the transfer defaults have been dealt with in the articles and that the buyer named in the clause can actually pay.

The contract set

Vesting provisions belong in three documents. Check each term is in the document that binds the intended party.

The employment chapter limits what a lock-in based on employment terms can require. A non-compete between employer and employee is valid only in writing, only as far as the employer’s particular need for protection requires, and for at most one year after termination (arbeidsmiljøloven § 14 A-1).

It cannot be enforced after an employer-initiated dismissal unless the dismissal is objectively justified by the employee’s conduct or circumstances. Nor can it be enforced where the employer’s breach gave the employee reasonable grounds to end the employment. The statutory written-statement requirements must also be met; otherwise the clause lapses.

The employer owes compensation for the restraint period, expressed as ratios of the National Insurance basic amount (grunnbeløpet, G) in § 14 A-3. G is reset with effect from 1 May each year and published by NAV, so the kroner figure moves annually and the ratio does not. The employee protections cannot generally be waived. A narrow exception applies to the company’s top executive, who may waive the chapter’s non-compete and customer-clause protections in a written agreement in return for severance pay before leaving (§ 14 A-5). This is not a general exception for managers.

Whether that chapter applies to a non-compete in a shareholders’ agreement binding a founder who is also an employee requires a concrete assessment. A restraint accepted as a shareholder or seller is in principle governed by Contracts Act section 38. Section 38 sets neither a fixed one-year limit nor a compensation requirement.

Where the founder is genuinely an employee and the clause substitutes for an employment non-compete, a court may apply the chapter regardless of which document contains the clause. The classification turns on whether the founder holds a substantial stake or token equity, and whether the restraint is tied to the shares or to the role.

The safer assumption is to size and document the restraint as if the chapter applied. One year at most, a genuine protection need, and clarity about which document pays for the restraint if it is invoked.

For the top manager the chapter’s rights can be waived in a written agreement against severance before departure under § 14 A-5, which takes that person’s restraint out of the chapter and into avtaleloven § 38.

The tax question in leaver pricing

Skatteetaten’s principle statement of 28 March 2022 sets the baseline: shares acquired at market value on real commercial terms produce no employment income at acquisition, substance governs over labels, and where the holder lacks real capital risk a gain can be reclassified from capital income to employment income. Withholding and employer’s contributions then follow for the company.

Founder shares bought at nominal value on incorporation and sold back on the same terms carry no obvious gain. Vesting and leaver pricing that shield the founder from loss, or that tie the value they keep to continued employment, pull toward the real-capital-risk test.

Put two questions to a tax adviser before signing. Is agreeing a buyback condition on shares the founder already owns itself a taxable event, and how is a bad-leaver sale at nominal value treated for the founder and for the remaining shareholders? The tax articles carry the shareholder model.

What an incoming angel should require

The leaver clause must work whichever founder leaves or stays. Require complete provisions covering every founder before the round closes.

• Every relevant founder covered, with any differences in the agreed schedules explained, including founders who hold through a holding company and founders who are not employees.
• A schedule that outlasts the runway the round buys, so the protection is live through the period the company can least afford a departure.
• The three decisions in the leaver table settled in words, with fair value defined and a valuer named.
• A price assessed against avtaleloven § 36 on a blameless leaver. Assess the reason for departure, service already provided, the size of the discount and the agreement as a whole. A modest discount is not automatically enforceable, and a harsh price may be set aside or adjusted.
• The buyer route made executable: consent and pre-emption addressed in the articles for the transfer route, or the requirements for a capital reduction checked. Under § 12-7, redemption without creditor notice requires registration of the redemption provision before or at the same time as the shares were issued, and either no distribution or a distribution within the dividend limit.
• A suitable pledge restriction, plus a check for existing pledges over the shares. A contractual prohibition does not establish that the shares are unencumbered.
• Drafting for the leaver who is also a director. Employment and the board office end separately. Resignation or removal under aksjeloven § 6-7 must be followed by prompt registration. An unregistered departure cannot be relied on against a protected third party under foretaksregisterloven § 7-1. Simply ceasing to attend does not end the office. Departure does not erase liability for earlier conduct.
• Drafting for the leaver who is the managing director (daglig leder). A departing employee has ordinary dismissal protection; the company’s top manager may waive it in advance, in an advance agreement, which should clearly record the waiver, in return for severance (arbeidsmiljøloven § 15-16). The statute fixes no severance amount. Assess the actual agreement; do not assume that a particular amount guarantees an effective waiver. A founder-CEO of a small AS qualifies if they genuinely hold the top role with overall responsibility.

Focus your review according to your experience and role.

• A first-time angel reads the leaver clause against the three tables above and asks counsel about anything missing from it.
• An experienced angel goes straight to the price, the buyer and the director provisions, which are where drafts fail.
• In a syndicate, one investor owns the founder terms and reports the three decisions to the group in a page.