Investment Agreement (Nigeria)
INVESTMENT AGREEMENT
Companies and Allied Matters Act 2020 | Investment and Securities Act 2007 | Finance Act 2021
THIS INVESTMENT AGREEMENT is made this [Date of Agreement]
BETWEEN:
(1) [Company Name] (RC No: [Company RC]) of [Company Address] (hereinafter referred to as the "Company");
(2) [Investor Name] of [Investor Address] (hereinafter referred to as the "Investor"); AND
(3) [Founder Names] (hereinafter collectively referred to as the "Founders").
1. SHARE SUBSCRIPTION
1.1 Subject to satisfaction of the Conditions Precedent set out in Clause 2, the Company agrees to issue and allot, and the Investor agrees to subscribe for, [Shares Issued] at a subscription price of [Subscription Price Per Share], for a total investment amount of [Investment Amount] (the "Investment").
1.2 The shares shall be of the class: [Share Class].
1.3 The pre-money valuation of the Company on a fully diluted basis is [Pre-Money Valuation].
1.4 Completion of the subscription shall occur on [Closing Date] or such other date as the Parties may agree in writing (the "Closing Date").
2. CONDITIONS PRECEDENT
2.1 The Investor's obligation to complete the Investment is conditional on: (a) the Company passing the required board and shareholder resolutions under CAMA 2020 to authorise the issuance of the shares; (b) amendment of the Articles of Association to incorporate the rights attaching to the [Share Class]; (c) completion of due diligence to the Investor's satisfaction; and (d) execution by all parties of a Shareholders' Agreement.
3. INVESTOR RIGHTS
3.1 Board Representation: The Investor shall be entitled to [Board Representation] on the Company's board of directors.
3.2 Anti-Dilution: The Investor shall have [Anti-Dilution] anti-dilution protection. In the event of a down-round issuance (shares issued at a price lower than the Investor's subscription price), the Company shall issue additional shares to the Investor to give effect to the anti-dilution adjustment.
3.3 Pre-emption Rights: The Investor shall have pre-emption rights on any new shares issued by the Company under CAMA 2020 Section 180, pro rata to the Investor's shareholding, subject to the exceptions therein.
3.4 Information Rights: The Company shall provide the Investor with: (a) monthly management accounts within 15 days of month end; (b) quarterly financial statements within 30 days of quarter end; and (c) annual audited financial statements prepared in accordance with IFRS within 90 days of financial year end.
3.5 Drag-Along: If shareholders holding [Drag-Along Threshold] wish to sell all their shares to a bona fide third-party acquirer, they shall have the right to require the remaining shareholders (including the Investor) to sell their shares on the same terms.
3.6 Tag-Along: If any shareholder (including the Founders) proposes to sell shares representing more than 10% of the Company's issued share capital, the Investor shall have the right to participate in the sale on the same terms, pro rata to its shareholding.
4. REPRESENTATIONS AND WARRANTIES
4.1 The Company and the Founders jointly and severally represent and warrant to the Investor that: (a) the Company is duly incorporated and in good standing under CAMA 2020; (b) the Company has good and marketable title to all assets described in the investment materials; (c) the Company has filed all tax returns and paid all taxes due to the Federal Inland Revenue Service (FIRS) and all State Internal Revenue Services; (d) the Company has not engaged in any act that would constitute a breach of the Companies Income Tax Act (CITA, Cap C21, LFN 2004) or the FIRS Establishment Act 2007; and (e) there are no undisclosed liabilities, litigation, or regulatory investigations.
5. GOVERNING LAW AND DISPUTE RESOLUTION
5.1 This Agreement is governed by the laws of Nigeria and the laws of [Governing State] State. Any dispute shall be resolved by arbitration in accordance with the Arbitration and Mediation Act 2023, or at the Lagos Court of Arbitration (LCA), or at the Federal High Court.
Company (authorised signatory)
________________
Signature
Investor
________________
Signature
Founder(s)
________________
Signature
What Is a Investment Agreement (Nigeria)?
An Investment Agreement in Nigeria sets out the rights, duties and consideration binding the parties to it.
Corporate investment transactions in Nigeria typically involve a combination of two documents: a Share Subscription Agreement (SSA), under which the investor agrees to subscribe for new shares at an agreed price, and a Shareholders' Agreement (SHA), which governs the ongoing rights and obligations of shareholders. In practice, Nigerian lawyers and investors often combine these into a single Investment Agreement (also called a Share Purchase and Subscription Agreement) for efficiency. Angel investment and venture capital rounds in the Nigerian startup ecosystem — which includes companies backed by Ventures Platform, GreenHouse Capital, TLcom Capital, and the Lagos State Employment Trust Fund (LSETF) — routinely use investment agreements based on the Seed SAFE (Simple Agreement for Future Equity) framework adapted for Nigerian CAMA 2020 requirements.
The Securities and Exchange Commission (SEC) Nigeria, established under the Investment and Securities Act 2007, regulates capital market transactions including public offers, rights issues, and private placements above prescribed thresholds. Private placements of securities in Nigeria that involve 50 or fewer investors and are not made to the general public are generally exempt from SEC registration requirements under the SEC Rules and Regulations, but must comply with the minimum disclosure obligations of CAMA 2020. For investments into startups registered under the National Information Technology Development Agency (NITDA) or the FIRS startup certificate programme, additional incentives under the Finance Act 2021 may apply.
An Investment Agreement in Nigeria must be distinguished from a Convertible Note Agreement (or SAFE), which is a debt instrument that converts into equity upon a qualifying event, and from a Loan Agreement, which is pure debt without equity participation. The Investment Agreement is a permanent equity instrument creating a shareholder relationship governed by CAMA 2020.
The legal framework governing the Investment Agreement (Nigeria) in Nigeria draws on several key statutes and regulatory bodies. Under Nigerian law, the Companies and Allied Matters Act 2020 (CAMA) regulates corporate entities through the Corporate Affairs Commission (CAC). The Labour Act (Cap L1 LFN 2004) and the National Industrial Court of Nigeria (NICN) govern employment disputes. The Nigeria Data Protection Regulation (NDPR) 2019 and the Nigeria Data Protection Commission (NDPC) protect personal data. The Federal Inland Revenue Service (FIRS) administers tax obligations under the Companies Income Tax Act. The Federal High Court and state High Courts have jurisdiction over civil matters. Parties executing a Investment Agreement (Nigeria) in Nigeria should confirm the document reflects current law, including any amendments enacted since the original drafting date. The Companies and Allied Matters Act (CAMA) 2020 sets the foundational requirements.
When Do You Need a Investment Agreement (Nigeria)?
An Investment Agreement in Nigeria is required whenever an investor subscribes for equity shares or other securities in a Nigerian company and the parties need to formalise the investment terms and investor rights.
An Investment Agreement is needed when a venture capital fund (such as TLcom Capital, CRE Venture Capital, or Greenhouse Capital) or angel investor makes a seed or Series A equity investment into a Nigerian tech startup, documenting the subscription price, pre-money valuation, anti-dilution protections, and board representation rights.
An Investment Agreement is required when a private equity firm acquires a minority or majority stake in a Nigerian company through a private placement under CAMA 2020 Section 177, and the parties need to document the economic and governance rights attaching to the acquired shares including information rights, consent rights, and exit provisions.
An Investment Agreement is needed when the Lagos State Employment Trust Fund (LSETF), the Bank of Industry (BOI), or the Nigerian Export-Import Bank (NEXIM Bank) provides equity or quasi-equity finance to an SME, requiring documentation of the development finance institution's rights and the company's reporting obligations.
An Investment Agreement is required when a company issues preference shares (redeemable or convertible) to investors, and the terms of the preference — including dividend priority, redemption rights, and conversion mechanics — must be documented in an Investment Agreement supplemented by a resolution amending the Articles of Association under CAMA 2020.
An Investment Agreement is needed when a Nigerian company raises funds through a private placement memorandum (PPM) issued to a limited number of qualified investors, and each investor must execute a subscription agreement incorporating the investment terms and representations and warranties.
Parties in Nigeria should prepare a Investment Agreement (Nigeria) proactively rather than waiting for a dispute to arise. Courts interpret agreements based on the written terms rather than oral representations. Under Nigerian law, the Companies and Allied Matters Act 2020 (CAMA) regulates corporate entities through the Corporate Affairs Commission (CAC). The Labour Act (Cap L1 LFN 2004) and the National Industrial Court of Nigeria (NICN) govern employment disputes. The Nigeria Data Protection Regulation (NDPR) 2019 and the Nigeria Data Protection Commission (NDPC) protect personal data. The Federal Inland Revenue Service (FIRS) administers tax obligations under the Companies Income Tax Act. The Federal High Court and state High Courts have jurisdiction over civil matters. Where the transaction involves regulated activities, prior approval from the relevant authority may be required before execution.
What to Include in Your Investment Agreement (Nigeria)
A valid Investment Agreement in Nigeria must contain the following essential elements.
Parties: Full legal names, CAMA 2020 RC numbers, and addresses of all parties — the investor(s), the company, and (where required) the existing shareholders who are granting consent to the investment.
Investment Amount and Share Subscription: The total investment amount in Nigerian Naira (NGN) or US Dollars (USD), the number of shares to be issued to the investor, the subscription price per share, the pre-money and post-money valuation of the company, and the class of shares (ordinary or preference) being issued.
Conditions Precedent: The conditions that must be satisfied before the investment completes — such as satisfactory due diligence, board and shareholder resolutions under CAMA 2020, amendment of the Articles of Association, and any regulatory approvals required from SEC Nigeria or the CBN.
Representations and Warranties: The company's and founders' representations and warranties to the investor covering the company's legal status, financial condition, ownership of IP, absence of undisclosed liabilities, compliance with FIRS tax obligations, and accuracy of financial statements.
Investor Rights: Anti-dilution protection (broad-based weighted average or full ratchet); pre-emption rights on new share issuances under CAMA 2020 Section 180; information rights (monthly management accounts, annual audited accounts); board representation or observer rights; protective provisions (veto rights over material decisions).
Drag-Along and Tag-Along: Drag-along rights allowing majority shareholders to require minority shareholders to sell on the same terms in an exit; tag-along rights protecting minority investors by entitling them to participate in any share sale by the founders.
Exit Provisions: Target exit timeline, IPO aspirations, and the process for a trade sale, including rights of first refusal under CAMA 2020.
Governing Law: Nigerian law, with the Federal High Court or State High Court having jurisdiction, or arbitration at the Lagos Court of Arbitration (LCA) or under ICC Rules.
Additional compliance elements for a Investment Agreement (Nigeria) used in Nigeria include: Under Nigerian law, the Companies and Allied Matters Act 2020 (CAMA) regulates corporate entities through the Corporate Affairs Commission (CAC). The Labour Act (Cap L1 LFN 2004) and the National Industrial Court of Nigeria (NICN) govern employment disputes. The Nigeria Data Protection Regulation (NDPR) 2019 and the Nigeria Data Protection Commission (NDPC) protect personal data. The Federal Inland Revenue Service (FIRS) administers tax obligations under the Companies Income Tax Act. The Federal High Court and state High Courts have jurisdiction over civil matters. Forms-legal.com provides this template as a starting point for Nigeria-compliant documentation.
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Reference this free template in an article, syllabus, or research note:
Forms Legal. (2026). Investment Agreement (Nigeria) (Nigeria) [Legal document template]. Forms Legal. https://forms-legal.com/nigeria/financial/agreements/investment-agreement-nigeria
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title = {Investment Agreement (Nigeria) (Nigeria)},
year = {2026},
howpublished = {\url{https://forms-legal.com/nigeria/financial/agreements/investment-agreement-nigeria}},
note = {Free legal document template. Based on Companies and Allied Matters Act (CAMA) 2020}
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Frequently Asked Questions
Investment agreements in Nigeria are governed by several overlapping legal frameworks. The Companies and Allied Matters Act 2020 (CAMA 2020) governs the corporate mechanics of share issuance, shareholder rights, pre-emption, and board composition. The Investment and Securities Act 2007 (ISA 2007) and the Securities and Exchange Commission (SEC) Nigeria's Rules and Regulations govern capital market transactions, private placements, and securities offerings. For foreign investors, the Nigerian Investment Promotion Commission Act (NIPC Act, Cap N117, LFN 2004) establishes investment protections, repatriation rights under the Foreign Exchange (Monitoring and Miscellaneous Provisions) Act (FEMMA), and guarantees against expropriation without compensation. The Companies Income Tax Act (CITA, Cap C21, LFN 2004) and the Finance Acts govern the tax treatment of capital gains, dividends, and interest payments arising from the investment. General Nigerian contract law governs the interpretation and enforcement of the agreement itself.
Whether an Investment Agreement in Nigeria requires Securities and Exchange Commission (SEC) Nigeria approval depends on the nature of the transaction. Public offers of securities — where shares are offered to the general public — require SEC registration and approval under the Investment and Securities Act 2007 (ISA 2007) and the SEC Rules and Regulations. Private placements made to 50 or fewer sophisticated or institutional investors and not offered to the general public are generally exempt from SEC registration, but must comply with minimum disclosure requirements and be documented in a private placement memorandum (PPM). Investments in startups and SMEs through angel or venture capital rounds are typically structured as exempt private placements. The SEC's Capital Market Master Plan 2021-2025 includes initiatives to streamline the regulatory framework for startup investment in Nigeria, and the SEC Accelerated Regulatory Incubation Programme (ARIP) provides a fast-track framework for fintech and technology companies.
Anti-dilution protection in a Nigerian investment agreement is a contractual mechanism that adjusts the investor's share price or shareholding percentage if the company subsequently issues new shares at a price below the investor's original subscription price (a 'down round'). Two main forms exist: full ratchet anti-dilution, which adjusts the investor's effective price down to the price of the new lower-priced shares (highly favourable to the investor but rarely used in Nigeria); and broad-based weighted average anti-dilution, which calculates a blended adjusted price based on all existing shares, new shares, and the prices paid (more balanced and the standard in Nigerian venture capital transactions). Under CAMA 2020, anti-dilution adjustments are implemented through conversion mechanics in preference share terms documented in the company's Articles of Association, or through additional share issuances to the investor at a nominal price. The Articles must be amended by special resolution under CAMA 2020 Section 44 to give effect to these provisions.
A foreign investor in Nigeria may repatriate investment returns — including dividends, capital gains, and proceeds from the sale of shares — subject to compliance with the Foreign Exchange (Monitoring and Miscellaneous Provisions) Act (FEMMA, Cap F34, LFN 2004) and the Central Bank of Nigeria's (CBN) Foreign Exchange Manual. To repatriate funds, the investor must have imported the original investment capital through a CBN-authorised dealer bank and obtained a Certificate of Capital Importation (CCI) at the time of investment. The CCI is the key document evidencing the lawful importation of foreign capital and entitles the holder to repatriate principal and returns. Dividend repatriation is subject to a 10% withholding tax under the Companies Income Tax Act (CITA, Cap C21, LFN 2004), as amended by the Finance Acts. Capital gains on the sale of shares in a Nigerian company are subject to Capital Gains Tax at 10% under the Capital Gains Tax Act (Cap C1, LFN 2004), as amended.
A drag-along clause in a Nigerian investment agreement is a contractual provision that allows a specified majority of shareholders (typically the founders and major investors) to require all other shareholders — including minority investors — to sell their shares to a third-party acquirer on the same terms and at the same price as the majority. The purpose of the drag-along is to enable a clean exit for a prospective acquirer who wants 100% of the company's shares without being blocked by a minority shareholder who refuses to sell. Under CAMA 2020, a drag-along clause must be incorporated into the company's Articles of Association by special resolution under CAMA 2020 Section 44 to bind all shareholders, and should be supplemented by a Shareholders' Agreement to which all shareholders are party. A corresponding tag-along clause protects minority investors by granting them the right to participate in any share sale by the majority, receiving the same price and terms.
This template is provided for informational purposes only and does not constitute legal advice. Laws vary by jurisdiction and change over time. Consult a qualified attorney for advice specific to your situation.Full disclaimer
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