During the enrollment of an angel investor for a startup company in the OCR field (see projects chapter) investing a sum of more than a million dollars, at which value the investor was a minority shareholder in the startup company, difficulty arose in ensuring the investor that the money would be used according to the business plan and the due conduct, correct running of the startup company.
Accordingly, a structure was formed whereby the parties consented to an instrumental trust. The meaning is structuring a move that provides the investor, under certain circumstances, a position of controlling the company’s activity, even when he is a minority shareholder, until the stage of enrolling additional investors who together achieved control of the startup company.
Once the need for the instrumental trust had run its course, the equity for the services was disposed of (Exist).