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Equity Investment Agreement
"I need an Equity Investment Agreement for a Series A investment of AUD 5 million in my technology startup, where the investor will receive 20% preference shares and requires one board seat; the agreement should include standard anti-dilution and pre-emptive rights."
1. Parties: Identification of the investor(s), company, and any other relevant parties to the agreement
2. Background: Context of the investment, company's business, and purpose of the agreement
3. Definitions and Interpretation: Key terms used throughout the agreement and rules for interpretation
4. Investment Terms: Details of investment amount, share class, price per share, and payment terms
5. Completion: Conditions precedent, completion mechanics, and timing of the investment
6. Warranties and Representations: Company warranties, investor warranties, and accuracy of information provided
7. Company Covenants: Ongoing obligations of the company regarding operations, reporting, and compliance
8. Shareholder Rights: Voting rights, dividend rights, and other rights attached to the shares
9. Board Representation: Rights to appoint directors and board observer rights
10. Information Rights: Regular reporting requirements and access to company information
11. Reserved Matters: Decisions requiring investor consent
12. Transfer Restrictions: Limitations on share transfers and pre-emptive rights
13. Exit Provisions: Tag-along, drag-along rights, and IPO provisions
14. Confidentiality: Protection of confidential information and announcement restrictions
15. Dispute Resolution: Process for resolving disputes between parties
16. General Provisions: Standard boilerplate clauses including notices, amendments, and governing law
1. Anti-Dilution Protection: Protection against future down-rounds, typically included for larger institutional investments
2. FIRB Approval: Required when foreign investment approval is needed under Australian law
3. Founder Commitments: Specific obligations of founders including non-compete and continued involvement
4. Strategic Collaboration: For strategic investors who will have business relationship with the company
5. Employee Share Scheme: If the investment includes establishment of an employee share scheme
6. Environmental, Social and Governance: ESG requirements, typically for institutional or impact investors
7. Multiple Closing Mechanics: For investments with multiple tranches or conditions
8. Special Veto Rights: Additional investor protections beyond standard reserved matters
1. Capital Structure: Pre and post-investment share capital structure
2. Company Details: Corporate information, directors, secretary, registered office
3. Warranties: Detailed list of company warranties
4. Reserved Matters: Comprehensive list of decisions requiring investor consent
5. Completion Requirements: Detailed list of completion deliverables and requirements
6. Form of Board Resolution: Pro-forma board resolutions for completion
7. Deed of Accession: Form for future shareholders to join the agreement
8. Business Plan: Company's business plan and financial projections
9. Key Personnel: Details of key management and their service agreements
10. Disclosure Letter: Company's disclosures against the warranties
Authors
Technology
Healthcare
Financial Services
Manufacturing
Real Estate
Mining and Resources
Renewable Energy
Retail
Agriculture
Professional Services
Media and Entertainment
Biotechnology
Software and IT
Consumer Goods
Infrastructure
Legal
Finance
Corporate Development
Compliance
Executive Leadership
Board of Directors
Investment
Due Diligence
Corporate Secretariat
Risk Management
Strategy
Mergers and Acquisitions
Chief Executive Officer
Chief Financial Officer
Chief Legal Officer
General Counsel
Corporate Lawyer
Investment Manager
Private Equity Partner
Venture Capital Associate
Company Director
Company Secretary
Corporate Development Manager
Investment Banker
Due Diligence Officer
Compliance Manager
Financial Controller
Managing Director
Board Member
Investment Analyst
Legal Counsel
Finance Director
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