Investment contracts can range from a simple share sale contract to a complex document with many different provisions. Some investment agreements start in the form of converted loans that allow the investor to convert the loan into shares at a certain price at a given time. Similar agreements use convertible preferred shares rather than debt securities. Accepting investors into your small business can be an enjoyable experience or turn into a terrible legal nightmare. It is always advisable to let a lawyer prepare a comprehensive investment contract to ensure that all parties are aware of the terms of the investment and its impact on the property and financial expectations. In certain circumstances, you may be prevented from accepting investments from people who are not considered accredited investors and who respect the necessary personal financial capacity. Before entering into an investment agreement, your lawyer should thoroughly review all the legal requirements related to it. Written and certified investment agreements are important evidence of the legality of the transaction and the resulting ownership in the event of the death of one of the parties. They protect the entrepreneur from investor claims lightly and give the investor a remedy in case of fraud. If the investor is also a participant in the operation, the investment contract formalizes his monetary contribution and percentage of ownership, so that there are no future disputes over property rights. An investment contract is only the intention of the parties to this Agreement. It is never advisable to accept investments, however well-defined, from a difficult person who is likely to be a nuisance to the management of the company or who makes unfounded allegations of fraud and misrepresentation if the company fails and the investment is a waste of money. The investment contract lists all parties to the transaction, their legal names, addresses and other contact details.
It determines the amount of the investment, the percentage of ownership transferred to the investor, the dilution rules, the timing and definitions of the obligations of the parties, the reasons for the termination, the satisfaction of the delay in the agreement and the arbitration or settlement procedures. When signing the agreement, the parties certify that they have the power to enter into such an agreement and that they are able, financially and legally, to invest money in the transaction. Any investment agreement, whether investments in a small business or a large company, serves as a written record of the complete performance terms and requirements between the owners and their investors. When it comes to monetary matters, it is always advisable to record each agreement in writing, especially investment agreements that set out the results of negotiations between business owners and investors, as well as their various promises and obligations arising from the contract. Specializing in entrepreneurial issues, Victoria Duff draws on her experience as a renowned start-up facilitator, Catalyst company and investor relations manager. Since 1995, she has written numerous articles for E-Zines and has been a regular columnist for Digital Coast Reporter and Developments Magazine. Sie hat einen Bachelor of Arts in öffentlicher Verwaltung von der University of California at Berkeley. . . .