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Equity Investment Contract for New Zealand

Equity Investment Contract Template for New Zealand

A comprehensive legal agreement governed by New Zealand law that documents the terms and conditions under which an investor acquires equity (shares) in a company. The document outlines the investment amount, share class, pricing, and number of shares being issued, while also addressing key aspects such as investor rights, governance provisions, warranties, and share transfer restrictions. It ensures compliance with New Zealand's Companies Act 1993 and Financial Markets Conduct Act 2013, providing necessary protections for both the investor and the company while establishing a clear framework for the investment relationship.

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Equity Investment Contract

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What is a Equity Investment Contract?

The Equity Investment Contract serves as the primary legal instrument for documenting share acquisitions and investment terms in New Zealand companies. This document is essential when a company is seeking to raise capital through the issuance of shares to new or existing investors. It complies with New Zealand corporate and securities laws, including the Companies Act 1993 and Financial Markets Conduct Act 2013, and typically includes detailed provisions on share rights, investment amounts, completion mechanics, warranties, board representation, and investor protections. The agreement is particularly crucial for startups, growing companies, and established businesses seeking additional capital, as it provides the legal framework for the investment relationship while protecting the interests of both the company and its investors.

What sections should be included in a Equity Investment Contract?

1. Parties: Identification of the Company, the Investor(s), and any other relevant parties to the agreement

2. Background: Context of the investment, including company status, purpose of investment, and any relevant pre-conditions

3. Definitions: Detailed definitions of terms used throughout the agreement

4. Investment Terms: Details of the investment amount, share class, price per share, and payment terms

5. Completion: Conditions precedent, completion requirements, and timing of the investment

6. Warranties and Representations: Company warranties, investor warranties, and continuing obligations

7. Governance Rights: Board composition, voting rights, and reserved matters requiring investor consent

8. Share Rights: Detailed description of the rights attached to the shares being issued

9. Transfer Restrictions: Limitations on share transfers and pre-emptive rights

10. Tag and Drag Rights: Provisions for co-sale rights and forced sale mechanisms

11. Confidentiality: Obligations regarding confidential information and announcements

12. General Provisions: Standard boilerplate clauses including notices, amendments, and governing law

What sections are optional to include in a Equity Investment Contract?

1. Anti-dilution Protection: Protection mechanisms against future dilutive share issues, included when requested by sophisticated investors

2. Liquidation Preference: Preferential rights on liquidation or exit, typically included for preferred share investments

3. Information Rights: Specific reporting and information access rights, often included for significant investments

4. Employee Share Scheme: Provisions relating to existing or proposed employee share schemes, included if relevant

5. Strategic Rights: Special rights for strategic investors, such as first right of refusal on commercial contracts

6. Right to Participate in Future Rounds: Pre-emptive rights on future investment rounds, typically for larger investors

What schedules should be included in a Equity Investment Contract?

1. Company Details: Complete corporate information including shareholding structure pre and post-investment

2. Warranties: Detailed list of company warranties

3. Share Rights and Terms: Detailed terms and conditions attached to the investment shares

4. Completion Requirements: Checklist of documents and actions required for completion

5. Reserved Matters: Comprehensive list of decisions requiring investor consent

6. Deed of Adherence: Template deed for future shareholders to sign up to the agreement

7. Board Regulations: Detailed procedures for board meetings and decision-making

8. Disclosure Letter: Company's disclosures against the warranties

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

New Zealand

Publisher

Ƶ

Document Type

Purchase Agreement

Cost

Free to use
Relevant legal definitions















































Clauses

































Relevant Industries

Technology

Biotechnology

Financial Services

Manufacturing

Real Estate

Healthcare

Renewable Energy

E-commerce

Agriculture

Software Development

Professional Services

Media and Entertainment

Infrastructure

Consumer Goods

Education Technology

Relevant Teams

Legal

Finance

Corporate Development

Executive Management

Board of Directors

Investment

Compliance

Corporate Secretariat

Business Development

Risk Management

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Chief Legal Officer

Company Secretary

Investment Manager

Corporate Lawyer

Legal Counsel

Investment Director

Venture Capital Partner

Private Equity Manager

Business Development Director

Finance Director

Board Director

Company Director

Corporate Development Manager

Investment Analyst

Financial Controller

Compliance Officer

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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