Knowing how to make an investment contract is important knowledge for a business owner, it is going to talk about investment and make agreements with people that will run the business with him. Don’t be scared, you can learn about how to make a simple contract for investment here, and furthermore, we are also going to show a simple investment contract template for you to use. Let’s check it out!
An investment contract can be found when you are about to enter a business relationship that involves shares. People use investment contracts to help them secure their basic interests. Regardless we are the one investing capital, or the one who owns the business, an Investor Agreement or investment contract can help keep both parties protected.
Below are several cases when we need to provide the Investors Agreement document:
- You’re creating a business and exploring investors over the sale of shares.
- You’re funding a start-up or company and want to protect your interests as the shareholder.
- You are a business owner who wants to address potential disputes between shareholders or investors.
What to Input On Simple Investment Contract
First thing first, you need to know what elements need to be input on your contract document. You need to make sure that no important information that is related to your business agreement is left behind. Here are the elements that you need to put on your simple investment contract:
The basic information will be about all the basic details of both parties who participated in the agreement. This will include the name and addresses of each party and the contract number. There shall be no mistakes here to make sure all parties are responsible for the agreement.
Details of Investment Agreement
Write down all particles of agreement on the contract. This will include information on shares ownership, the amount of investment that the investor provides, the form of how the investment agreement works, and also the time and deadline the investment will be transferred. The process of investment transfer can also be informed on the simple investment contract but it isn’t a must.
The Expected ROI
The detail of when and how your investor will receive their Return of Investment (ROI) should also be stated on a simple investment contract template. The contract should also mention the condition that will be taken if any worst case happens during the period of the agreement. If this information is not stated, both parties will be unaware of any possible risks and that may lead to disadvantageous to any party participated.
Explanation of Reporting and Control
You also should explain the detail of the rights that participating parties have within the company or the project. Through this way, the hierarchy and bureaucracy of the company and investment agreement will be clear on how the company management will run after the investment contract signed.
Sign of The Contract
Every party that is participating in the investment contract must sign the contract in the presence of two witnesses. After that, the investment contract copies should be given to each party so they will have their own record on the agreement.
Simple Investment Contract Template
If you are looking for ideas or a template to create a simple investment contract, then the following examples can be great resources for you as the following samples come in very handy to help you compose the perfect contract for your business. We can edit these editable samples with any other additional statements and clauses to tailor-fit to prevent any disputes between shareholders and investors.
We hope these samples can be helpful for you. Enjoy!