Free Investment Contract Templates. Download, Customize & Sign.

A solid investment agreement should include: (1) investment amount and valuation cap or pre-money valuation, (2) equity percentage or conversion terms, (3) investor rights - pro-rata rights, information rights (financial statements), and anti-dilution protection, (4) use of funds and reporting obligations, (5) representations and warranties from both parties, (6) board seat rights or observer rights, (7) transfer restrictions and right of first refusal, and (8) exit provisions and liquidation preferences.

A SAFE (Simple Agreement for Future Equity) is not a debt instrument - it has no interest rate or maturity date. It converts to equity at the next qualifying funding round, typically at a discounted price or capped valuation. A convertible note is a debt instrument that accrues interest and has a maturity date. If the company does not raise a qualifying round before maturity, the note must be repaid or renegotiated. Both instruments are common in early-stage startup investing.

A valuation cap sets the maximum company valuation at which an investment converts to equity. It protects early investors from dilution when a company raises a subsequent round at a significantly higher valuation. For example, if an investor holds a SAFE with a $5M cap and the company raises at a $20M valuation, the investor converts as if the valuation were $5M - receiving four times more equity than a new investor paying the same price.

Key investor rights to include are: (1) pro-rata rights - the right to participate in future funding rounds to maintain ownership percentage, (2) information rights - access to financial statements and board materials, (3) anti-dilution protection - adjustment mechanisms if the company issues shares at a lower price, (4) most favored nation (MFN) clause - entitlement to better terms offered to future investors, and (5) board observer rights - the ability to attend board meetings without voting power.

A term sheet is a non-binding document that summarizes the key terms of a proposed investment - valuation, investment amount, equity stake, investor rights, and governance provisions. It is standard practice for venture and angel deals to negotiate and agree on a term sheet before drafting the full investment agreement. It aligns both parties on the key commercial terms before spending time and legal fees on detailed documentation.

Yes. All templates are jurisdiction-flexible by design. Download any template and edit it in Word or PDF, or create a free Legitt AI account and let Lana AI tailor the governing law, valuation cap, investor rights, equity provisions, and jurisdiction-specific requirements in under 60 seconds - no manual editing required.