Creating standard agreements for investors, clients, and project partners

Development of standard agreements with investors, clients and project partners

In any business, contracts are necessarily concluded between partners. They are made in writing: for this, the following methods are used:

• indelible correspondence, where authorized accounts are used on different messengers, or e-mail;
• properly executed legal documents (papers must be certified by a notary).

Agreements between partners may become distorted after some time. One of the partners remembers certain important moments, the other remembers completely different. They remember, as a rule, the most favorable conditions for them in an oral transaction. As a result, conflicts often arise between partners.

Basically, such investment agreements are considered to be actually loan agreements disguised with a beautiful name, which means that certain consequences appear after them. Therefore, experts do not recommend going for “refined, beautiful names” of agreements if finances are transferred between partners due to an investment agreement for the sake of rapid business growth. In such a situation, the risk is not excluded that such a document will be regarded as a targeted loan, and therefore everything will have to be returned with interest. If the investment agreement states that in return for providing finance, the partner receives a share in the jointly created company, then such a document loses its meaning. In order to legally transfer something, it must be owned. However, since the firm is opened jointly, then the part of the “investor” from the very beginning is not the property of the partner who received the money. This part is not at all someone’s property until the investor pays for it. And the debt still does not disappear. In such a situation, due to a “defect” in the part of the concluded transaction, which is associated with the inability to fulfill the counter obligation, it is likely that the agreement will be regarded as a target loan, it will be returned with interest.

If you have planned paperwork, signing a standard agreement with partners or investors, please contact the specialists of our company. You can ask them important questions related to this topic.