capital raising is the process by which a business raises money, enabling it to fund an expansion of its operations. an investment agreement is a contract between founders and investors who are looking to purchase shares of an existing company. the conditions that give rise to its effectiveness and rights to terminate it cannot be unconditional, to comply with the requirements of a take-private investment transaction. this means that the rights and obligations of shareholders would remain the same after a transfer of shares as if the new shareholder is an original investor bound by the investment agreement and/or shareholders agreement. this method of payment mitigates the risks undertaken by investors and motivates founders to achieve their business goals.