Starting a business feels like juggling flaming torches – exciting, but one wrong move and everything comes crashing down. The difference between success and failure often comes down to having the right legal foundation in place from day one.
MOIs, Shareholder Agreements, and Loan Agreements aren’t just legal paperwork gathering dust in a filing cabinet. They’re the backbone of your business structure, protecting your interests and providing clarity when things get complicated.
Think of your Memorandum of Incorporation (MOI) as your company’s official rulebook. It’s the document that brings your company to life and tells the world exactly what your business is about.
Your MOI covers the essentials:
When do you need one? The moment you decide to incorporate. No MOI, no company – it’s that simple. But here’s where many entrepreneurs stumble: treating the MOI like a generic template. Your MOI should be tailored to your specific business needs. A tech startup raising venture capital needs very different provisions than a family restaurant.
If your MOI is the birth certificate, your Shareholder Agreement is the relationship manual. It governs how shareholders interact, make decisions, and handle disputes – your “what happens when things get messy” document.
Key elements include:
When do you need one? If you have multiple shareholders – even if it’s just you and your best friend – you need a shareholder agreement. Without one, you’re looking at expensive legal battles that could destroy both relationships and business.
Loan Agreements spell out exactly who owes what, when, and what happens if things go sideways. Whether borrowing from banks, investors, or family, proper documentation protects everyone involved.
Essential components:
When do you need one? Every time money changes hands with an expectation of repayment. Yes, even that interest-free loan from family. Family money disputes are the fastest way to turn celebrations into awkward affairs.
These documents don’t exist in isolation – they’re like the three legs of a stool. Your MOI sets the framework, your Shareholder Agreement fills in relationship details, and Loan Agreements ensure financing is properly structured.
When investors come calling, they want to see all three documents working in harmony. A typical funding scenario involves scrutinising your MOI for company structure, examining your Shareholder Agreement for decision-making processes, and reviewing loan agreements for financial obligations.
Poorly drafted or missing agreements can be devastating:
While templates might seem tempting, business legal documents aren’t one-size-fits-all. Your industry, business model, and growth plans all influence what should be included.
At Cosecly, we have specialist legal teams and partners who understand the unique challenges facing emerging businesses. We provide legal services to assist start-ups, creatives, and tech-based businesses to grow legally and safely, ensuring your documents are drafted to grow with your company.
But legal documents are just one piece of the puzzle. We are also a team of tech-savvy financial professionals who are experts in the cloud. We are here to partner with you to make your life simpler so you can focus on building your business.
Timing Is Everything
These agreements aren’t just legal must-haves, they’re how you protect your business and set it up to grow without drama. Get them right early, and you’ll avoid major schlep (and legal bills) later.
At Cosecly, we help businesses build strong foundations – no handshake deals, no crossed fingers. Just proper structure, sorted from the start.
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