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Startup ecosystem · Incorporation

MOA and AOA: clauses that matter at fundraise time

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  1. Facts

    MOA (Memorandum of Association) sets the company's objects, what you're legally authorised to do. AOA (Articles of Association) sets internal governance, how decisions are made, how shares are transferred, what rights investors get.

  2. Provisions and law

    • Companies Act 2013, Sec 4, 5, 13, 14

  3. Analysis

    Critical MOA clauses: Objects clause must be broad enough to cover your pivot. "Technology services and related activities" covers more than "mobile application development." Investors will ask to see your MOA during DD. Critical AOA clauses: Pre-emption rights (ROFR on share transfer), drag-along rights, tag-along rights, quorum requirements, consent rights. Table F (Companies Act default AOA) is inadequate for a funded startup, you need a custom AOA.

  4. Conclusion

    1. Authorised share capital sufficient for ESOP pool + investor shares
    2. CCPS provisions, preference share rights, conversion mechanics
    3. Drag-along clause, majority can drag minority into an exit
    4. Tag-along clause, minority can join a majority sale on same terms
    5. ROFR, existing shareholders get first right before outside transfer

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