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SeedFAST Investment Agreement

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SEEDFAST INVESTMENT AGREEMENT

This SeedFAST Investment Agreement (the Agreement) is made as of by and between Company Name: , a organized under the laws of , with its principal place of business at (Company), and Investor Name: , an with mailing address at (Investor). Company and Investor are each a Party and together the Parties.

RECITALS

WHEREAS, Company is conducting a seed-stage financing to raise capital to fund its operations and product development;

WHEREAS, Investor desires to invest the Purchase Amount (as defined below) in Company on the terms and subject to the conditions of this Agreement;

WHEREAS, the Parties intend that the investment will convert into equity upon a specified Equity Financing or other conversion events provided herein.

NOW, THEREFORE, in consideration of the mutual promises and covenants contained in this Agreement, the Parties agree as follows:

1. DEFINITIONS

For purposes of this Agreement, the following terms have the meanings set forth below:

"Purchase Amount" means the amount to be invested by Investor:

"Valuation Cap" means the valuation cap for conversion: ; "Discount Rate" means the discount percentage applicable at conversion:

"Equity Financing" means the next bona fide sale of the Company's Preferred Stock for aggregate gross proceeds of at least (excluding the conversion of any convertible securities).

2. PURCHASE AND SALE

Subject to the terms and conditions of this Agreement, Investor agrees to purchase and Company agrees to sell to Investor, and Company shall issue to Investor, a convertible instrument (the Instrument) evidencing the Purchase Amount.

At the Closing, Investor shall deliver the Purchase Amount to Company by wire transfer or other agreed method in immediately available funds to an account designated by Company.

3. CLOSING

The closing of the purchase and sale of the Instrument (the Closing) shall occur as of the date agreed by the Parties or such earlier date as the Parties may agree in writing. The anticipated Closing date is .

4. CONVERSION

(a) Automatic Conversion. In the event of an Equity Financing prior to repayment, the outstanding principal of the Instrument and any accrued but unpaid amounts shall automatically convert into the number of shares of the Company's Preferred Stock equal to the Purchase Amount divided by the Conversion Price. The Conversion Price shall be the lesser of (i) the price per share equal to Valuation Cap divided by the Company's Fully Diluted Capitalization at the time of conversion or (ii) the price per share equal to the price paid by the purchasers in such Equity Financing multiplied by (1 - Discount Rate).

(b) Liquidity Event. In the event of a Change of Control or Liquidity Event prior to conversion, Investor shall either (i) receive a payment equal to the Purchase Amount, or (ii) at Investor's election, convert into the type of securities issued in such transaction on terms consistent with this Agreement.

5. REPRESENTATIONS AND WARRANTIES

5.1 Company Representations. Company represents and warrants to Investor that:

(a) Organization and Power: Company is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization and has full corporate power and authority to enter into and perform this Agreement.

(b) Authorization: The execution and delivery of this Agreement and the performance of Company’s obligations have been duly authorized by all necessary corporate action.

(c) Compliance with Law: To the best of Company's knowledge, Company is not in violation of any material agreement, law, or order that would prevent the performance of this Agreement.

5.2 Investor Representations. Investor represents and warrants to Company that:

(a) Investment Purpose; Accredited Investor Status: Investor is acquiring the Instrument for investment for Investor's own account and not with a view to distribution. Investor is an accredited investor as defined under applicable securities laws and will deliver evidence of such status upon request.

(b) Authority: If Investor is an entity, Investor has full power and authority to enter into this Agreement and the person executing this Agreement on Investor's behalf is duly authorized to do so.

6. COVENANTS

Company covenants to use the Purchase Amount for business purposes as described to Investor and not for personal, family or household purposes. Company will provide Investor with annual financial statements and other information reasonably requested by Investor for one year following the Closing.

Investor covenants that Investor will comply with transfer restrictions under applicable securities laws and will not transfer the Instrument except as permitted by this Agreement and applicable law.

7. TRANSFER RESTRICTIONS

The Instrument and any securities issued upon conversion shall be subject to restrictions on transfer, including requirements for compliance with securities law and Company right of first refusal and legend placement. Any attempted transfer in violation of this Agreement shall be null and void.

8. INDEMNIFICATION

Each Party agrees to indemnify, defend and hold harmless the other Party and its officers, directors, agents and employees from and against any and all losses, claims, damages, liabilities and expenses (including reasonable attorneys' fees) arising out of a breach of such Party's representations, warranties or covenants under this Agreement, except to the extent caused by the other Party's gross negligence or willful misconduct.

9. CONDITIONS TO CLOSING

Closing is subject to customary closing conditions, including: (a) representations and warranties being true and correct as of the Closing; (b) Company delivering organizational documents and corporate authorizations; and (c) no material adverse change in Company's business prior to the Closing.

10. NOTICES

All notices required or permitted under this Agreement shall be in writing and delivered to the addresses above and shall be effective upon receipt.

11. AMENDMENTS; WAIVER; COUNTERPARTS

This Agreement may be amended or modified only by a written instrument executed by both Parties. No delay or failure to exercise any right shall operate as a waiver. This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one instrument.

12. GOVERNING LAW; ENTIRE AGREEMENT; SEVERABILITY

This Agreement shall be governed by and construed in accordance with the laws of the State of , without regard to choice-of-law principles. This Agreement constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements and understandings, both written and oral. If any provision of this Agreement is held invalid or unenforceable, such provision shall be severed and the remaining provisions shall remain in full force and effect.

13. MISCELLANEOUS PROVISIONS

(a) Assignment. Neither Party may assign this Agreement without the prior written consent of the other Party, except that Company may assign to an affiliate or successor by merger or acquisition.

(b) Expenses. Except as otherwise set forth herein, each Party shall bear its own legal and other expenses incurred in connection with this Agreement and the transactions contemplated hereby.

REPRESENTATIVE SIGNATURE AUTHORIZATIONS

Each individual signing this Agreement on behalf of an entity represents and warrants that he or she has been duly authorized to execute and deliver this Agreement on behalf of such entity and that this Agreement constitutes a valid and binding obligation of such entity.

Company:

By:

Date:

Title:

Investor:

By:

Date:

Title:

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What the SeedFAST Investment Agreement Is and When It’s Used

The SeedFAST Investment Agreement is a short-form seed-stage investment contract used to document investor commitments, purchase amount, securities issued, closing conditions, and basic representations and warranties. It streamlines early-stage equity or convertible instrument transactions where parties prefer a standardized template to speed negotiation. The form typically covers parties, aggregate investment, price or valuation cap, closing mechanics, investor rights, confidentiality, and signatures, and can be adapted to reflect specific deal terms or jurisdictional requirements.

Why Use a SeedFAST Investment Agreement

A SeedFAST Investment Agreement standardizes common seed-stage terms so negotiations focus on key business points rather than drafting boilerplate. It reduces legal drafting time, improves consistency across rounds, and clarifies closing mechanics for founders and investors while remaining adaptable to addenda and investor-specific schedules.

Why Use a SeedFAST Investment Agreement

Who Typically Prepares and Signs This Agreement

The SeedFAST Investment Agreement is used by founders, early investors, and corporate counsel to document seed financings in a concise template format.

  • Founders and company executives preparing the term sheet and closing documents for seed capital.
  • Angel investors and seed funds committing capital and confirming purchase terms.
  • Attorneys and paralegals reviewing and customizing clauses to reflect specific legal or tax considerations.

Representative Signatories and Roles

Founder / CEO

A founder or authorized officer signs on behalf of the company and warrants authority to issue securities; counsel should confirm corporate authorization and board approval prior to signing.

Investor or Fund

An individual investor signs to accept the terms or a fund signs via its authorized manager; a fund should provide authorization documents showing the signer has authority to make investment commitments.

Essential Data Fields Required in the Agreement

Company Name: Exact legal entity
Investor Name: Legal entity or individual
Investment Amount: US dollars
Securities Type: Equity or convertible
Effective Date: MM/DD/YYYY
Governing Law: Selected state

Key Legal Risks and Consequences of Errors

Authority Risk: Unauthorized issuance
Tax Risk: Unreported income
Securities Risk: Regulatory noncompliance
Drafting Risk: Ambiguous rights
Timing Risk: Missed closing
Recordkeeping Risk: Retention violations

Common Preparation Mistakes to Avoid

  • Using imprecise party names or omitting entity suffixes which can create enforcement or transfer problems later.
  • Failing to record board or member approvals prior to signing, exposing the transaction to invalidation.
  • Neglecting to include clear closing conditions or funding mechanics, causing disputes at settlement.
  • Overlooking tax classification or securities exemptions and failing to obtain necessary filings or notices.

Step-by-Step: Completing a SeedFAST Investment Agreement

Follow these practical steps to prepare and execute the agreement accurately for a standard seed investment.

  • 01
    1. Prepare Parties: Enter full legal names and entity types.
  • 02
    2. Set Terms: Specify amount, price, and securities type.
  • 03
    3. Attach Schedules: Add investor lists and pro rata rights.
  • 04
    4. Approvals: Confirm board resolution and signatures.

How Execution and Closing Typically Flow

A typical closing process aligns document exchange, signature collection, wire instructions, and post-closing filings in a coordinated sequence.

  • Draft and Review: Parties negotiate and counsel reviews.
  • Signatures: Sign using ESIGN-compliant eSignature or wet ink.
  • Funding: Investor wires funds to escrow or company.
  • Post-Closing: Update cap table and deliverable filings.

Core Clauses to Include in a Professional SeedFAST Agreement

A concise seed investment template should contain specific provisions to manage economic terms, governance implications, closing logistics, and post-closing obligations that matter to both founders and investors.

Purchase Terms

Clear description of the investment amount, price per share or conversion mechanics, and the type of security being issued to prevent later valuation disputes.

Closing Conditions

Precise conditions precedent, including board approvals, officer certificates, legal opinions if required, and delivery of wire instructions or escrow receipts.

Representations and Warranties

Company and investor representations, including capitalization statements and authority to enter, tailored to the risk level of a seed round.

Covenants

Mutual covenants regarding use of proceeds, information rights, and actions between signing and closing to preserve deal intent.

Indemnities

Limited indemnity language allocating responsibility for breaches, with caps or baskets appropriate for early-stage companies.

Governing Law and Notices

Choice of law clause and designated notice addresses to reduce jurisdictional uncertainty and simplify dispute resolution.

Configuring an Online Execution Workflow

Set up a straightforward digital workflow that places signature, date, and initial fields for each signer and routes the executed copy to stakeholders automatically.

Field Configuration
Signature Required, set signer role
Date Auto-fill upon signature
Initials Optional per page where needed
Access Link Email or secure link

Technical Considerations for Digital Completion

Choose an eSignature platform that supports audit trails, document export, and appropriate authentication for your transaction.

  • Authentication: Email or SMS verification
  • Audit Trail: IP, timestamp, and actions
  • Document Formats: PDF and DOCX supported

Timing Considerations and Standard Deadlines

Track deadlines for closing deliverables, tax reporting, and filings to avoid penalties and ensure investor protections are effective at the intended date.

Effective Date:

Date entered as MM/DD/YYYY when obligations commence

Closing Window:

Specified period to satisfy closing conditions

Tax Reporting:

Reportable transactions may affect IRS filings and forms

Board Approvals:

Resolutions should be completed before signing

Record Updates:

Update cap table immediately after closing

Key Milestones from Negotiation to Post-Closing

A sequential view of major milestones helps coordinate counsel, founders, and investors to ensure orderly completion and post-closing actions.

01

Term Negotiation

Negotiate economic and governance terms, then finalize draft

02

Legal Review

Attorney review and redlines resolved before execution

03

Execution

Collect signatures and complete funding mechanics

04

Post-Closing Tasks

Record agreements, update capitalization and investor records

eSignature Vendor Pricing Snapshot for Seed Agreement Execution

Compare baseline pricing and capabilities for digital signature vendors commonly used for investment documents. signNow is listed first by design; verify vendor plans before purchase.

signNow DocuSign Adobe Sign PandaDoc HelloSign
Starting Price $8/user/mo $15/user/mo $14/user/mo $19/user/mo $15/user/mo
Free Trial 7-day free trial, no credit card required Varies by vendor Varies by vendor Varies by vendor Varies by vendor
Bulk Send Yes Yes Yes Yes Limited
Audit Trail Yes Yes Yes Yes Yes
HIPAA Compliant Yes Yes Yes No No

Real-World Examples of SeedFAST in Use

These short examples illustrate how the template is applied across organizations and deal sizes.

Optica Ventures

Optica standardized its seed documentation to accelerate closings and reduce negotiation cycles.

  • Resulted in consistent investor disclosures across deals.
  • The standardized approach allowed counsel to focus on nonstandard protections and reduced per-deal attorney hours.

Martin Properties

A small portfolio company used the template with eSignatures to close remote investor commitments.

  • Signatures were obtained across multiple time zones.
  • Post-closing administrative tasks such as cap table updates and investor welcome packs were completed faster.

Practical Tips to Ensure an Accurate and Enforceable Agreement

Follow these practical best practices to reduce disputes and administrative friction at closing and afterward.

Use Exact Legal Names
Confirm entity names against formation documents and include EIN or registration numbers where relevant to avoid identity confusion.
Record Board Approvals
Obtain and retain board or member resolutions authorizing the issuance of securities before accepting funds.
Standardize Schedules
Attach consistent schedules for capitalization, investor rights, and closing deliverables to reduce negotiation variance.
Preserve Audit Trails
When using eSignatures, ensure the platform captures timestamps, IP addresses, and signer authentication evidence.

Frequently Asked Questions About SeedFAST Agreements and eSignatures

Answers to common legal, technical, and procedural questions about completing, signing, and storing a SeedFAST Investment Agreement.


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