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Investment Contract Template for Hong Kong

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Key Requirements PROMPT example:

Investment Contract

"I need an Investment Contract under Hong Kong law for a Series A investment of HKD 10 million in exchange for preferred shares, with standard anti-dilution protection and a board seat for completion by March 2025."

Document background
The Investment Contract serves as the primary documentation for equity or debt investments in Hong Kong-based or Hong Kong-law governed transactions. It is essential for any transaction where capital is being invested in exchange for shares, notes, or other securities. The document must comply with Hong Kong's regulatory requirements, particularly the Securities and Futures Ordinance and Companies Ordinance. This Investment Contract is typically used for private equity investments, venture capital funding, strategic corporate investments, or other forms of private placement. It contains crucial elements such as investment terms, shareholder rights, corporate governance provisions, and exit mechanisms, all tailored to Hong Kong's legal framework and market practices. The document is fundamental for protecting both investor and company interests while ensuring regulatory compliance in Hong Kong's dynamic business environment.
Suggested Sections

1. Parties: Identification of the investor(s) and investee company, including registration details and addresses

2. Background: Context of the investment, brief description of the company's business, and purpose of the investment

3. Definitions: Definitions of key terms used throughout the agreement

4. Investment Terms: Details of the investment amount, payment terms, and what is being received in return (e.g., shares, notes, etc.)

5. Conditions Precedent: Conditions that must be satisfied before the investment is completed

6. Completion: Mechanics of closing the investment, including timing and deliverables

7. Representations and Warranties: Statements of fact and assurances from both parties

8. Investor Rights: Key rights granted to the investor, including information rights and board representation if applicable

9. Transfer Restrictions: Limitations on the transfer of securities and any right of first refusal provisions

10. Confidentiality: Obligations regarding confidential information

11. Anti-dilution Protection: Provisions protecting the investor's ownership percentage

12. Exit Rights: Provisions regarding future sale, IPO, or other exit events

13. Governing Law and Jurisdiction: Specification of Hong Kong law and courts' jurisdiction

14. General Provisions: Standard boilerplate clauses including notices, amendments, and entire agreement

Optional Sections

1. Tag-Along Rights: Optional section for when investors want the right to join in any sale by major shareholders

2. Drag-Along Rights: Optional section for forcing minority shareholders to join in a company sale

3. Conversion Rights: Required for convertible investments, detailing conversion mechanics and pricing

4. Dividend Rights: For preference shares, detailing any preferential dividend rights

5. Liquidation Preference: Optional protection giving investors priority in liquidation scenarios

6. Restrictive Covenants: Optional restrictions on company operations requiring investor consent

7. Employee Share Option Pool: Required if the investment includes provisions for employee equity

8. Environmental, Social and Governance (ESG): Optional section for investments with ESG requirements

9. Anti-Money Laundering Provisions: Required for investments from financial institutions or when dealing with regulated entities

Suggested Schedules

1. Schedule 1: Company Information: Detailed corporate information, including share capital structure and subsidiaries

2. Schedule 2: Warranties: Detailed list of company warranties and representations

3. Schedule 3: Conditions Precedent: Detailed list of all conditions to be satisfied before completion

4. Schedule 4: Completion Requirements: Detailed list of documents and actions required at completion

5. Schedule 5: Reserved Matters: List of actions requiring investor consent

6. Appendix A: Capitalization Table: Pre and post-investment share capital structure

7. Appendix B: Business Plan: Company's business plan and financial projections

8. Appendix C: Key Performance Indicators: Specific metrics for monitoring company performance

9. Appendix D: Form of Shareholders' Agreement: If applicable, form of shareholders' agreement to be entered into

10. Appendix E: Corporate Authorizations: Copies of board and shareholder resolutions approving the investment

Authors

Alex Denne

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

Relevant legal definitions


























































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Relevant Industries

Financial Services

Technology

Real Estate

Manufacturing

Healthcare

E-commerce

Renewable Energy

Biotechnology

Infrastructure

Consumer Goods

Professional Services

Education

Telecommunications

Media and Entertainment

Retail

Relevant Teams

Legal

Finance

Compliance

Corporate Development

Investment

Risk Management

Company Secretarial

Board of Directors

Executive Management

Due Diligence

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Chief Legal Officer

Investment Director

Corporate Lawyer

Investment Manager

Company Secretary

Compliance Officer

Due Diligence Officer

Risk Manager

Private Equity Manager

Venture Capital Partner

Investment Banker

Fund Manager

Corporate Development Director

Board Director

General Counsel

Finance Director

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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