Dr Elke Napokoj LL.M. and Dr Michaela Pelinka LL.M. 

Vienna, 07 September 2023. Participation in start-ups triggered a real hype in Austria. This book deals with the legal structure of such investments and builds on the book “Der Beteiligungsvertrag Venture-Capital-Finanzierung”, which was published by Linde Verlag in 2017. Now more than five years have passed. The new version by Dr Elke Napokoj LL.M. and Dr Michaela Pelinka LL.M., partners at bpv Huegel Rechtsanwälte in Vienna, was therefore necessary because the drafting of contracts and also practice have changed.

A large part of the book is devoted to the contractual framework and the most important content-related regulations to be provided for and the relationship of the individual contracts to each other. The main part is, on the one hand, the participation agreement with its essential provisions on participation through capital increase, milestone financing, “binding of the founders” – good leaver and bad leaver clauses as well as guarantees and warranty (types, guarantors and contents including legal consequences) and, on the other hand, the shareholder agreements and their typical contents. Special attention is also paid to the practical arrangements of the extensive participation and control rights of the venture capital investor and the syndicate agreements. In addition to a presentation of the forms of equity participation, i.e. in particular also the differentiation of venture capital financing from other financing, the market participants and the individual financing phases are dealt with.

The book uses numerous sample clauses to show what to look out for in such an investment. The advantages and disadvantages of an investment are explained from the perspective of the target company, the existing shareholders and investors. The focus is on the participation agreement with its essential provisions.

Elke Napokoj, partner at bpv Huegel: “The work is aimed equally at venture capital companies, industrial investors, public investors, private investors and target companies and deals with all practical issues, including the latest trends in contract drafting. It contains many practical examples and formulation suggestions. With this book, nothing stands in the way of your successful participation in companies thanks to the presentation of both the civil and financing-relevant components of venture capital financing.“

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