It is understood that investments are similar to a business. Simple investment agreement contracts are a legally binding document that bears the transaction of two parties regarding the money invested and the distribution of profits. If a specific party fails to meet the terms and conditions of an agreement without a proper excuse or reason, then it is considered as a breach of the investment contract. There are many simple contract templates for you to take a look at and choose the best one that will suit all your needs perfectly.
16+ Investment Contract Templates
Basic Investment Contract Template
Investing is not something to do or enter without proper planning and also, careful consideration. Even then, the parties involved will want assurance that everything will go as smoothly as agreed upon. This can be done effortlessly with the help of contract templates, like the one above. Having this by your side will ensure that you come up with a professional-quality contract effortlessly.
Simple Investment Contract Template
If you have an investor who wants to invest in your business, then you have to make sure to draft the perfect contract. This contract shall outline the terms of the investment that all the parties involved have agreed upon. Simple contract forms will be of great help for you as they come in very handy to help you draft the perfect contract for your business. Perfect for arranging an agreement between business entrepreneurs seeking investment funding.
Investor Contract Template
The above-mentioned template is an investor contract template that can be of great help to you if you want to secure your basic interests for shares in a certain business like the equity investment contract. Attract investors to your business through the sales of shares of your business. Clearly define all areas of the business including management, investor share, and the manner of distribution of dividends. Prevent any disputes between shareholders by incorporating terms and conditions as well as dispute resolution options into this document. Insert any other additional statements and clauses into the template to tailor-fit to your specific purpose.
Guaranteed Investment Contract Template
Creating an agreement is not an easy job. If you want one that is already ready, then you are in the right place. Downloading the above template, edit and customize it the way you like best. All you have to do is download the template, edit the yellow highlights by entering your information. Customize the template in the way that fulfills your needs. It helps in the guaranteed rate of return in exchange for keeping a deposit for a fixed period of time.
Investment Contract Agreement Template
If a person/company decides to place stocks and contribute financial help and assistance to any smaller companies, there have to be terms and conditions for all the parties involved to follow, so that their partnership is secure. Check agreement samples, to come up with the best agreement possible for your business. This template is made to ensure that the terms and conditions of the partnership between you and the potential client have been met. Not only does it allow contractual agreements, but it also opens pathways for future ventures for the parties involved.
Real Estate Investment Contract Template
There are also instances in which two businesses decide to merge. For situations like these, a partnership contract is needed to legalize the said decision. Business is a complex matter that needs sufficient attention, from minute to immense details. To help you out with these matters, you can freely make use of our templates.
Synthetic Investment Contract Template
Produce a contract issued by your financial institution that wraps the underlying investments of clients to provide the principal preservation and steady yield expected of stable value. The above contract template can be used to create the right contract, so you do not have to make one from scratch. All you have to do is download the template, edit it according to your information and customize it with all the details. Check simple contract templates in Apple pages for more. Not only that, it can be downloaded on any electronic device.
Short Term Investment Contract Template
Create a worry-free investment contract for use on a savings account or bank fixed deposits by using this template. Feel assured and at ease knowing that your investment funds are safe where they need to be. Easily change up the terms and conditions of your contract using any popular software application compatible with any file you have chosen.
Restaurant Investment Contract Template
If you own a restaurant that is looking to bring investors to fund the expansion or startup of their restaurant, this template is the right one for you. It allows you to define all the terms and conditions you have to follow for the investment. From the minimum investment amount, all the way to the frequency and the percentage of profits to be shared will be defined and clearly explained. There are many free contract templates for you to check out, so you can pick the right one that will suit your needs perfectly.
Real Estate Contract
Example of Investment Contract
What Is an Investment Contract?
An investment contract can be defined as a contract, transaction, or an agreement scheme in which a person invests his/her money in a common business and expects profit on the efforts of others. Moreover, this document specifies the roles and responsibilities of both the investors and the investees during the term of the contract.
With a net worth of $67 billion, Forbes hailed Warren Buffett as the wealthiest investor in the world as of 2016.
In 2020, data from Statista showed that Buffett already placed fourth, next to Jeff Bezos, Bill Gates, and Bernard Arnault & Family, respectively.
Founder and CEO of Amazon, Jeff Bezos, currently has a net worth of $145.1 billion. Meanwhile, Bill Gates has $103.6 billion, Bernard Arnault & Family has $91.5 billion, and Warren Buffet has $73.4 billion.
6 Steps to Create an Investment Contract
Step 1: Identify the Parties
The first step towards making the best contract will be to identify the parties involved in the contract. The details of all the parties in the contract must be mentioned. These details are the name, company name, address, etc. of the individual/company.
Step 2: The Statements
The next step towards creating a contract is to fill in the “whereas” statement and the(the company that is seeking investment into its venture and also, the second company that is willing to provide the investment) “therefore” statement(this means in consideration of all the terms and conditions, promises, etc) in the contract. Every contract should have this statement, so it makes the contract legal.
Step 3: Payment Methods
You must mention the payment method the client has agreed to invest in. This could be a cheque, cash, credit/debit card, or installments. These have to mentioned in the contract without fail. Also, mention the payment terms. This could be by when you want the payment done if there is any need for an advance, etc.
Step 4: Terms, Conditions, and Termination
This is the most essential and crucial step in the contract. You have to mention all the terms and conditions that you are supposed to be following. Also, mention the length of time of the agreement till when it is valid, by when should the investor make the financial contribution and by when will s/he get a return on the investment they have made. Mention how the contract agreement will end and what is the process of contract termination. Also, mention of there is early termination, what happens, etc.
Step 5: Choice of Law
Since not all state laws are the same, mention which one you will be following. You have to mention which jurisdiction this comes under. Also, mention the law and what makes it relevant to the contract as well.
Step 6: Signature
The final step in writing a contract is to get the signatures of everyone involved in it. If there are any changes to be made in the contract, do so before getting it signed by the parties. Once it is signed, it is named final and is legally bound by the state law.
People Involved in an Investment Contract
Investing is such a risky decision to make because a specific business or individual is allocating assets to expect good returns.
An investment contract is not an easy job to deal with nor easy to create and manage. One can, of course, always make use of contract templates as a reference. For a contract to ensure, however, it needs people to agree. These people include the following:
- Investors – They put up money as a form of their investment expecting good profits to benefit from. Their investment may include – commodities, currency, equity, and debt securities.
- Existing Shareholders – These are the founders of the business. Should they wish to attract more investors, they need to use a profit and loss statement to show potential shareholders whether it is profitable to invest with them or not.
- Future Shareholders – This refers to the new people who will be having a share of the business in the future. They would need to assess a cash flow statement to evaluate the situation before deciding to invest.
Things to Consider when Writing an Investment Contract:
If you happen to be one of the business owners and are given a proposal, it is a must that before you accept the contract, you have to study it carefully or check our sample contract templates. So here are the things you must look for in the investment contract presented to you:
- The contract must be structured because there is a tendency that the agreement will eventually change if it does not meet your expectations. Be careful because some investors will mention their conditions in a subtle way and eventually you wouldn’t have any idea that your business has dramatically changed.
- There must be a granting of rights. The investor must guarantee to invest his money in your business and that he should have a fair share of the benefits.
- There must be anti-dilution protection. Investors mostly asked for this because this is a serious matter that may affect them if a decrease in overall percentage ownership may arise.
- Warranties should be included because circumstances like breaching promises to the business should be properly given consequences and that involves paying for the damages caused by the broken commitment.
When you are also planning to accept outside investors and partnerships, sample partnership contracts should be properly examined too.
1. What are the types of investment contracts?
There are mainly three types of investment contracts – cash equivalents, bonds, and shares. A stock can be defined as an investment in a specific company for a long time. A bond is a loan you take/make to a particular company or the government. And finally, a cash equivalent contract can be defined as a short term investment on assets of the business.
2. Are investment contracts a security?
Under a few legal acts all across the globe, the transactions which are called investment contracts are regarded as securities. This means that they are also subject to special requirements to agreements, registrations, disclosures, and so on.
3. What is a guaranteed investment contract?
A guaranteed investment contract is an insurance company that guarantees a rate of return in negotiation for holding and keeping collateral deposit for a certain time period. It is a contract that guarantees the repayment of loan/principal with a fixed rate of interest.
4. What are the elements of an investment contract?
There are a few elements that must be present in an investment contract. These elements are (1) offer; (2) agreement; (3) consideration; (4) duties; (5) competency and ability; and, in certain circumstances, (6) a written instrument. These elements are what make an investment contract what it should be and legal.