Document background
The Preferred Equity Agreement is a crucial document used in Australian corporate financing transactions where companies seek to raise capital while offering investors preferential rights over ordinary shareholders. This agreement is commonly utilized in growth-stage companies, private equity investments, and venture capital transactions where investors require additional protection and privileges beyond those offered to common shareholders. The document must comply with Australian corporate law, particularly the Corporations Act 2001 (Cth), and includes detailed provisions on economic rights, governance, exit mechanisms, and anti-dilution protection. It's essential for structuring investments that balance the company's need for growth capital with investors' requirements for downside protection and upside participation.
