Price and ownership percentages do not capture every consequence of an investment. Legal preparation should clarify control, funding conditions, future dilution and allocation of risk.
Identify where the money goes
A new share issue generally funds the company and may dilute existing holders. A secondary share transfer generally pays the selling shareholder. Transactions may combine both. Asset purchases and corporate reorganisations require different documentation and diligence.
Negotiate the operating terms
Review voting and board rights, reserved matters, future subscription rights, transfer restrictions, exit mechanisms and warranties. Agreements must be lawful and enforceable in the relevant jurisdiction; overseas investment terms should not be imported without review.
Align documents and approvals
State which term sheet provisions are binding. Align investment or transfer agreements with the shareholders’ agreement and charter. Examine investor funding capacity, closing conditions and remedies for delayed payment.
Foreign investment may require market access, ownership, investment procedure and payment analysis, alongside applicable competition or sector approvals. For a future IPO, assess whether preference rights, vetoes or repurchase commitments need adjustment.
KM UNION provides legal support and coordinates specialist partners where required. Explore our capital raising advisory or contact legal@kmunion.vn.
Questions for founders before signing
Who will approve new debt or a future share issue? What happens if the investor delays funding? How will an exit be handled if the anticipated IPO does not occur? Documenting these scenarios helps prevent a disagreement from becoming an operational deadlock.
Maintain a closing checklist that distinguishes signing from completion. Include approvals, evidence of payment, updated ownership records and any outstanding conditions. The investor, company and selling shareholders should understand who is responsible for each step.
Should investment rights remain unchanged before an IPO?
They should be reviewed in the context of the proposed public offering. Preference rights, vetoes and repurchase commitments may need adjustment by agreement and in accordance with applicable law.
Đọc bản tiếng Việt | IPO & Capital Raising Advisory
General information only; requirements must be assessed for the specific transaction.
