Simple Agreement For Equity Template for Austria

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Key Requirements PROMPT example:

Simple Agreement For Equity

"I need a Simple Agreement For Future Equity for my Vienna-based AI software startup, seeking to raise €500,000 from a German venture capital firm, with a €5 million valuation cap and including MFN rights and quarterly information rights."

Document background
The Simple Agreement For Equity (SAFE) was originally developed by Y Combinator and has been adapted to function within the Austrian legal framework. This document is primarily used by Austrian startups seeking to raise capital efficiently without immediately setting a company valuation or issuing shares. The agreement provides a framework for investment that converts to equity upon specific trigger events, such as priced funding rounds or exit events. It includes essential provisions required under Austrian corporate law while maintaining the streamlined nature of the original SAFE concept. The document is particularly suitable for early-stage companies in Austria seeking investment from both domestic and international investors, offering a balanced approach between legal compliance and practical functionality. It includes specific provisions for conversion mechanics, investor rights, and corporate governance that align with Austrian regulatory requirements while protecting both investor and company interests.
Suggested Sections

1. Parties: Identification of the company and the investor, including full legal names, registration details, and addresses

2. Background: Context of the agreement, describing the company's business and the investor's intention to provide funding in exchange for future equity rights

3. Definitions: Key terms used throughout the agreement, including 'Equity Financing', 'Liquidity Event', 'Valuation Cap', and other relevant terms

4. Investment Amount: Specification of the investment sum and payment terms

5. Events Triggering Conversion: Detailed description of events that trigger conversion of the investment into equity, including Equity Financing, Liquidity Event, and Dissolution Event

6. Conversion Mechanics: Process and calculations for converting the investment into equity shares under different scenarios

7. Company Representations: Essential representations about the company's legal status, authority to enter the agreement, and capital structure

8. Investor Representations: Basic representations about the investor's authority and understanding of the investment risks

9. Information Rights: Basic rights of the investor to receive company information

10. Assignment and Transfer: Rules governing the transfer of rights under the agreement

11. Governing Law and Jurisdiction: Specification of Austrian law as governing law and jurisdiction for disputes

12. Miscellaneous: Standard provisions including notices, amendments, and severability

Optional Sections

1. Most Favored Nation: Optional provision ensuring the investor receives the benefit of more favorable terms granted to other SAFE holders, used when requested by sophisticated investors

2. Pro-rata Rights: Rights to participate in future financing rounds, included when negotiated by lead investors

3. Board Observer Rights: Rights to attend board meetings as an observer, included for significant investors

4. Dispute Resolution: Detailed arbitration or mediation provisions, included when parties prefer alternative dispute resolution

5. Confidentiality: Detailed confidentiality obligations, included when standard NDA is not in place

6. Tax Provisions: Specific tax-related provisions, included when dealing with international investors or complex tax situations

Suggested Schedules

1. Schedule A - Cap Table: Current capitalization table of the company showing all shareholders and their shareholdings

2. Schedule B - Conversion Calculations: Detailed examples and formulas for calculating share conversion under different scenarios

3. Schedule C - Form of Adherence Agreement: Template for new investors to adhere to shareholders' agreement upon conversion

4. Schedule D - Investment Amount Details: Payment schedule and bank account details if payment is in installments

5. Appendix 1 - Company Information: Detailed company information including registration documents and corporate authorizations

6. Appendix 2 - Disclosure Schedule: Any specific disclosures or exceptions to company representations

Authors

Alex Denne

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

Relevant legal definitions
Relevant Industries

Technology

Biotechnology

Financial Services

E-commerce

Healthcare

Clean Energy

Software Development

Digital Media

Artificial Intelligence

Manufacturing

Consumer Products

Professional Services

Real Estate Technology

Educational Technology

Internet of Things

Relevant Teams

Legal

Finance

Executive Leadership

Corporate Development

Investment

Compliance

Corporate Governance

Business Development

Administrative

Risk Management

Relevant Roles

CEO

Founder

Co-founder

Chief Financial Officer

Legal Counsel

Investment Manager

Venture Capital Partner

Angel Investor

Corporate Lawyer

Investment Analyst

Business Development Director

Startup Advisor

Company Secretary

Finance Director

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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