Head of practice
Attorney. Specialist in commercial and labor law. Over 16 years of experience in legal support of businesses - debt recovery, contract enforcement, recovery of damages, commercial property and lease disputes.
Business investment agreement
What is an investment agreement?
An investment agreement (business investment agreement) is a commercial and legal agreement between the customer and the investor, which determines the terms of the project implementation, the rights and obligations of the parties. Each such agreement is unique and is developed individually for a specific project and the needs of the parties.
It is important to understand that there is no universal template for an investment agreement. The document must take into account the specifics of the business, the scale of the investment, the expectations of the parties and potential risks. That is why the development of the agreement requires the participation of qualified lawyers from both sides.
Legislative regulation
Investment activities in Ukraine are regulated by a number of regulatory acts:
- Economic Code of Ukraine
- Law of Ukraine “On Investment Activity”
- Law of Ukraine “On Foreign Investment Regime”
- Law of Ukraine “On State Support for Investment Projects with Significant Investments”
These documents establish a legal framework for carrying out investment activities and protecting the rights of investors.
Investment objects
Enterprises and production
- Creation of new enterprises from scratch
- Reconstruction or expansion of existing production plants
- Construction of production facilities and complexes
- Implementation of new production lines
Scientific and technical sphere
- Full cycle of scientific and technical developments
- Individual stages of research and development
- Innovative projects and startups
- Introduction of new technologies
Financial instruments
- Securities and Derivatives
- Bank Deposits
- Corporate Rights
- Intellectual Property
Types of investment contracts
Corporate rights purchase and sale agreement
This type of agreement involves the investor entering the authorized capital of the company through the purchase of shares or stakes. It is especially relevant for an already operating business that needs additional financing for development.
Key aspects:
- Determining the value of a share
- Mechanism of transfer of corporate rights
- Procedure of company management after the entry of an investor
- Terms of exit from business
Loan agreement
When concluding a loan agreement, the investor provides funds at a certain interest rate. This option has its advantages and risks for both parties.
Advantages for the investor:
- Guaranteed income regardless of the success of the project
- Clear repayment terms
- Possibility of securing the loan with property
Disadvantages:
- Limited profit potential
- Lack of management involvement
- Risk of non-return of funds
Joint activity agreement
It involves pooling the resources of the parties to achieve a common goal. It can include both financial contributions and contributions in the form of property, technology, experience.
Key elements of the agreement:
- Amount and form of contributions of the parties
- Distribution of profits and losses
- Decision-making procedure
- Mechanism for exiting joint activities
Convertible loan agreement
An innovative tool that gives the investor the right to choose: to get back the funds with interest or to convert the loan into a share in the business.
Features:
- Flexibility in choosing the form of investment return
- Possibility of participating in the success of the project
- Protection against the risks of failure
Option contract
Gives the investor the right to purchase a stake in a business at a predetermined price for a set period.
What to check before concluding a business investment agreement
Main terms of the contract
Each investment agreement must contain the following mandatory elements to ensure clarity of interaction between the parties and protection of their interests:
- Detailed description of the rights and obligations of the parties
- Clear deadlines for project implementation
- Mechanism for calculating and paying profits
- Liability for violation of terms
- Dispute resolution procedure
- Confidentiality terms
Risk protection
Comprehensive business due diligence. Before concluding a contract, it is necessary to conduct a thorough analysis of the company, which includes:
- Financial Statement Analysis
- Legal Risk Assessment
- Property Rights Verification
- Tax Liability Audit
- Market Position Assessment
Checking a potential partner. Special attention should be paid to studying the reputation and reliability of a future partner according to the following parameters:
- Business Reputation
- Litigation
- Tax Arrears
- Credit History
- Founder and Beneficiary Verification
State registration of the contract
Package of documents. For the official registration of the investment agreement, it is necessary to prepare the following list of documents:
Letter of application from the applicant
- Notarized contract (original and copy)
- Information card of the established sample
- Constituent documents with notarization
- Required licenses
- Non-resident documents (for foreign investors)
- Receipt of payment of administrative fee
Registration procedure. Documents are submitted through the ASC to the regional state administration. The processing time is 20 working days.
Submission options:
- In person by the applicant
- Through an authorized representative
- By registered letter
Calculate the cost of legal assistance
Legal assistance in drafting a business investment agreement
Successful conclusion of an investment agreement requires careful preparation and professional legal support. It is important to consider all aspects of future cooperation and provide mechanisms for protecting the interests of both parties. Involving qualified lawyers at the stage of preparing the agreement will minimize risks and provide a reliable basis for long-term cooperation.
If you need to develop or analyze an investment agreement, fill out the form below and discuss it with a lawyer soon.
Calculate the cost of services
1 question
Are you planning to invest over $100,000?
2 question
Do you have experience investing in Ukrainian companies?
3 question
Do you need advice on a specific investment project?
Is a subscriber form of service possible to quickly resolve issues as they arise?
Yes, of course, we take companies for permanent support.
The subscription form of service allows you to receive a full range of legal services on an ongoing basis for a fixed monthly fee.
Our lawyers will accompany all economic legal relations of your company: from drawing up contracts and solving corporate issues to representing interests during inspections by regulatory bodies and in court disputes.
We have very flexible pricing, so contact us and we will discuss your specific case.
Do you work only in Kyiv?
Fortunately, modern technologies allow us to effectively solve almost any legal issue online regardless of your location. In cases where personal presence is necessary, our lawyers are ready to travel to any point in Ukraine. Moreover, thanks to our network of reliable partners abroad, we can provide legal support even in international cases. Our goal is to provide you with quality legal assistance wherever you are.
You may also need:
Sue the buyer’s company in Ukraine
Read moreMediation of corporate disputes
Read moreCorporate agreement between the members of the LLC
Read moreBusiness protection: lawyer
Read moreCorporate attorney in Ukraine
Read moreCorporate disputes in Ukraine
Read moreSue the company
Read moreAssessment of corporate rights
Read morecall back
during the day
Compensation for moral, material damage
Protection of honour, dignity, and business reputationContract Development for Business and Legal Entities
Licensing of business activities
Compensation for moral, material damage
Legal services in the field of cryptocurrency and blockchain
REGISTRATION OF COMPANIES AND OPENING OF BANK ACCOUNTS
Sale and purchase of ready-made firms
Grants and attracting investment
Business registration and support in Great Britain
Business registration and support in Switzerland
Business registration and support in the EU
Business Registration and Support in the Gulf Countries (GCC)
Business registration and support in Turkey
Business registration and support in USA
Lawyer for administrative cases
Legal services for medical businesses and doctors
Protection of honour, dignity, and business reputation
Real estate transaction support
Escort of the tender participant
Trial lawyer: support and defense in court
European Court of Human Rights (ECHR)
