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Company Equity Agreement Template for Germany

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Key Requirements PROMPT example:

Company Equity Agreement

"I need a Company Equity Agreement for a German technology startup receiving Series A funding in March 2025, with provisions for two venture capital investors acquiring 30% ownership and including specific anti-dilution and board representation rights."

Document background
The Company Equity Agreement is a fundamental document used in German corporate structuring to establish and maintain clear equity ownership arrangements. It becomes necessary when companies issue new shares, bring in new investors, or restructure existing shareholdings. This document must comply with German corporate law requirements, particularly the Stock Corporation Act (Aktiengesetz) and Commercial Code (Handelsgesetzbuch). It includes essential provisions for share transfers, voting rights, shareholder obligations, and corporate governance structures. The agreement is particularly crucial for growing companies, startup investments, corporate restructuring, and any situation involving multiple shareholders where clear equity ownership and management rights need to be established. Special attention is given to German-specific requirements such as notarization requirements and registration with the commercial register (Handelsregister).
Suggested Sections

1. Parties: Identification of all parties to the agreement, including the company, existing shareholders, and new investors

2. Background: Context of the agreement, including company history, purpose of the equity issuance/transfer, and current shareholding structure

3. Definitions: Detailed definitions of key terms used throughout the agreement

4. Share Capital and Ownership Structure: Details of the company's share capital, classes of shares, and ownership distribution

5. Subscription/Purchase of Shares: Terms and conditions of the share subscription or purchase, including price and payment terms

6. Representations and Warranties: Statements of fact and assurances from both the company and the shareholders

7. Transfer Restrictions: Limitations and conditions on the transfer of shares

8. Shareholder Rights and Obligations: Basic rights and duties of shareholders, including voting rights and dividend entitlements

9. Corporate Governance: Management structure, decision-making processes, and shareholder meetings

10. Confidentiality: Obligations regarding confidential information

11. Term and Termination: Duration of the agreement and circumstances for termination

12. Governing Law and Jurisdiction: Specification of German law as governing law and jurisdiction for disputes

Optional Sections

1. Preference Rights: Special rights attached to preference shares, used when the company has or plans to issue preference shares

2. Tag-Along Rights: Rights of minority shareholders to join in the sale of shares, important for minority shareholder protection

3. Drag-Along Rights: Rights of majority shareholders to force minority shareholders to join in a sale, useful for exit scenarios

4. Anti-Dilution Provisions: Protection mechanisms against share dilution, typically included for venture capital investments

5. Employee Share Scheme: Provisions for employee share ownership, relevant when the company has or plans to implement such schemes

6. Pre-emptive Rights: Rights of existing shareholders to maintain their percentage ownership in future share issues

7. Bad Leaver Provisions: Consequences for shareholders who leave the company under negative circumstances, particularly relevant for founder/employee shareholders

8. Deadlock Resolution: Mechanisms for resolving shareholder disputes, particularly important in 50/50 ownership structures

Suggested Schedules

1. Capitalization Table: Detailed breakdown of the company's share capital and ownership structure

2. Share Certificate Template: Format and content of share certificates to be issued

3. Shareholders' Register: Current list of shareholders and their shareholdings

4. Company Articles of Association: Current version of the company's articles of association

5. Deed of Adherence: Template for new shareholders to become bound by the agreement

6. Corporate Resolutions: Relevant board and shareholder resolutions authorizing the agreement

7. Valuation Report: Independent valuation of the company's shares, if applicable

8. Transfer Notice Template: Standard form for notifying share transfers

Authors

Alex Denne

Head of Growth (Open Source Law) @ ºÚÁÏÊÓÆµ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions










































Clauses






































Relevant Industries

Technology and Software

Financial Services

Manufacturing

Professional Services

Healthcare and Life Sciences

Real Estate

Retail and Consumer Goods

Energy and Utilities

Media and Entertainment

Telecommunications

Industrial and Engineering

Biotechnology

E-commerce

Transportation and Logistics

Relevant Teams

Legal

Finance

Corporate Development

Executive Management

Compliance

Corporate Governance

Investment

Shareholder Relations

Business Development

Risk Management

Relevant Roles

Chief Executive Officer

Chief Financial Officer

General Counsel

Legal Director

Corporate Secretary

Investment Manager

Managing Director

Board Member

Corporate Lawyer

Finance Director

Compliance Officer

Business Development Director

Venture Capital Partner

Private Equity Manager

Company Secretary

Corporate Development Manager

Shareholder Relations Manager

Industries










Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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