Investment And Shareholders Agreement Template for Philippines

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Key Requirements PROMPT example:

Investment And Shareholders Agreement

"I need an Investment and Shareholders Agreement under Philippine law for a Series A investment round where a foreign venture capital firm is investing PHP 50 million for a 25% stake in our technology startup, with completion expected by March 2025."

Document background
The Investment And Shareholders Agreement is a crucial document used when new investors are entering a company or when existing shareholders are restructuring their relationships under Philippine law. It serves as the primary document governing both the investment transaction and ongoing shareholder relations, ensuring compliance with the Revised Corporation Code of the Philippines, Securities Regulation Code, and other relevant legislation. The agreement typically covers investment terms, share rights, corporate governance, minority protections, and exit provisions, while addressing specific Philippine regulatory requirements such as foreign ownership restrictions and SEC compliance. This document is particularly important in private equity investments, venture capital transactions, and strategic corporate investments, providing a framework for both the initial investment and long-term shareholder collaboration.
Suggested Sections

1. Parties: Identification of all parties to the agreement including the company, existing shareholders, and investors

2. Background: Context of the investment, current company status, and purpose of the agreement

3. Definitions and Interpretation: Definitions of key terms and interpretation rules for the agreement

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

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

6. Warranties and Representations: Warranties from the company, existing shareholders, and investors

7. Corporate Governance: Board composition, voting rights, reserved matters, and management provisions

8. Share Transfer Restrictions: Limitations on share transfers, right of first refusal, tag-along and drag-along rights

9. Pre-emptive Rights: Rights of existing shareholders to participate in future share issues

10. Information and Inspection Rights: Investors' rights to company information and financial reports

11. Confidentiality: Protection of confidential information and trade secrets

12. Default: Events of default and consequences

13. Term and Termination: Duration of the agreement and termination provisions

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

Optional Sections

1. Anti-Dilution Protection: Protection for investors against future down-rounds, used in venture capital investments

2. Intellectual Property Rights: Specific provisions for IP ownership and protection, essential for technology companies

3. Employee Share Option Pool: Terms for employee share schemes, included when company plans to implement ESOP

4. Non-Compete and Non-Solicitation: Restrictions on competitive activities, included for key shareholders

5. Exit Provisions: Specific provisions regarding IPO or trade sale, included for venture capital investments

6. Dividend Policy: Specific dividend distribution rules, included when parties want predetermined dividend arrangements

7. Foreign Ownership Compliance: Specific provisions ensuring compliance with Philippine foreign ownership restrictions, needed for foreign investors

8. Strategic Rights: Special rights for strategic investors, such as supply agreements or commercial collaboration

Suggested Schedules

1. Capital Structure: Details of share capital, shareholders and shareholding percentages pre and post-investment

2. Warranties: Detailed warranties given by the company and existing shareholders

3. Reserved Matters: List of decisions requiring special approval

4. Company Information: Key company information including corporate documents, licenses, and material contracts

5. Business Plan: Company's business plan and financial projections

6. Completion Requirements: Detailed list of completion deliverables and requirements

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

8. Key Management Contracts: Forms of employment agreements for key management

9. Share Transfer Procedures: Detailed procedures for implementing share transfers and rights of first refusal

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
Clauses
Relevant Industries

Technology and StartUps

Manufacturing

Financial Services

Real Estate and Property

Retail and Consumer Goods

Healthcare and Pharmaceuticals

Energy and Utilities

Agriculture and Food Processing

Transportation and Logistics

Education and Training

Professional Services

Media and Entertainment

Relevant Teams

Legal

Corporate Finance

Investment

Compliance

Corporate Secretarial

Board of Directors

Executive Management

Mergers and Acquisitions

Corporate Development

Risk Management

Corporate Governance

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Chief Legal Officer

Corporate Secretary

Investment Director

Venture Capital Partner

Private Equity Manager

Corporate Lawyer

Investment Banker

Board Director

Compliance Officer

Corporate Development Manager

General Counsel

Finance Director

Managing Director

Company Director

Investment Manager

Legal Counsel

Industries
Revised Corporation Code of the Philippines (Republic Act No. 11232): The primary legislation governing the establishment, operations, and regulation of corporations in the Philippines. It covers fundamental aspects of corporate governance, shareholder rights, and corporate operations.
Securities Regulation Code (Republic Act No. 8799): Regulates the securities market, including the sale, exchange, and trading of securities. Important for investment provisions and disclosure requirements.
Foreign Investments Act of 1991 (Republic Act No. 7042): Governs foreign investments in the Philippines, including restrictions on foreign ownership and participation in certain business activities.
National Internal Revenue Code: Covers tax implications of investments, share transfers, and dividend distributions, including documentary stamp tax and capital gains tax.
Philippine Competition Act (Republic Act No. 10667): Regulates anti-competitive behavior and market dominance, relevant for investment structures and shareholder arrangements.
Securities and Exchange Commission Memorandum Circulars: Various regulations and guidelines issued by the SEC regarding corporate governance, disclosure requirements, and shareholder rights.
Data Privacy Act of 2012 (Republic Act No. 10173): Regulates the collection, processing, and protection of personal information, relevant for information sharing provisions in the agreement.
Intellectual Property Code of the Philippines (Republic Act No. 8293): Important for provisions dealing with intellectual property rights, particularly in technology-related investments.
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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