Capital Raising & Securities

Shareholder and Investor Agreements

Rights, restrictions, and exits agreed before the money comes in.

Once investors own part of the company, the operating agreement or shareholder agreement governs the relationship for years. The firm negotiates and drafts those terms so the founders keep what they need to run the business and investors get what they were promised.

What investors usually ask for

Information rights, a say on major decisions, protection against dilution, a preference on the way out, and rights to sell alongside or force a sale. The firm explains what each term costs the founders and which are standard for the size of the round.

What founders should keep

Day-to-day control, a clear process for the decisions that need investor consent, and vesting or repurchase terms that protect the company if a founder leaves.

Exits and transfers

Restrictions on transferring interests, rights of first refusal, drag-along and tag-along rights, and what happens to an investor’s interest on death or divorce. These terms decide who the company’s owners will be in five years.

Updating the governing documents

Taking investment usually means amending the operating agreement or adopting a new shareholder agreement and bylaws. The firm makes those changes and keeps the cap table and records consistent with them.

Contact the office to negotiate or review investor terms.

Have a question about this?