Document background
The Letter of Investment Agreement is a crucial document used in South African business transactions to formalize investment arrangements between parties. It serves as a bridge between informal investment discussions and full-scale investment agreements, particularly suitable for early-stage investments, straightforward investment structures, or when a more concise format is preferred. The document must comply with South African financial regulations, including FAIS Act requirements, Companies Act provisions, and relevant exchange control regulations. It typically includes essential information about the investment amount, terms, conditions, investor rights, and basic governance provisions. While maintaining the format of a letter, it carries the legal weight of an investment agreement and should be drafted with appropriate legal consideration.
