A short, simple contract by which a company engages a person to act as its mentor or advisor. In return, the person does not receive any cash compensation but instead has the right to receive shares in the future. The advisor will serve as an independent consultant, not as an employee.
This agreement should be used together with either an Option Agreement or a Share Vesting Agreement.
When drafting a FAST Agreement, it is important to focus on the following:
• Services you expect to receive from the advisor;
• Type and amount of shares that the advisor will be entitled to receive (the amount is expressed by way of a percentage of the relevant class of shares);
• Schedule for vesting of the shares;
• Mechanism under which the advisor will receive shares (by way of either share option or share vesting arrangement); and
• How long the notice period is for terminating the engagement.
FAST stands for “Founder Advisor Standard Template” and was created by the Founder Institute. In the Dragon Law app, you have the flexibility of stating any percentage of equity compensation that you wish to give to your advisor.
You should note that the FAST Agreement is intended for an advisor or a mentor who will assume an advisory role in the business. If you wish to engage this person to give core input to your business or perform executive functions, use an Employment Contract or a Director’s Service Agreement (if the person will be appointed as a director).