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About Share Subscription Agreements

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WHY YOU NEED A SHARE SUBSCRIPTION AGREEMENT

You need a Subscription Agreement if you wish to subscribe for shares in a company to ensure that:

your rights as an incoming shareholder are protected;
you have an opportunity to undertake complete due diligence before you complete your subscription (in the template this is a condition precedent);
as the subscriber you subscribe for shares in the company free from security interests;
the subscription shares are issued to you on the completion date;
you obtain appropriate warranties and indemnities from the company, and if appropriate, other existing shareholders.

RISKS OF NOT HAVING A SHARE SUBSCRIPTION AGREEMENT

If you subscribe for shares in a company without an agreement some of the risks may include:

you, as subscriber, may buy shares that are not free from security interests or are not properly issued by the company;
you may be buying shares in a company without knowing the financial position of the company;
there may be limited recourse against the company or existing shareholders if the value of the company is misrepresented.

You can purchase a Share Subscription Agreement online Contract Template.

Or, return to Buying Shares and Businesses.

Why you need agreements for purchasing a business Risks of not having purchase agreements Key Commercial Issues for buying a business About Due Diligence About Shareholders' Deeds About Share Subscription Agreements

Business Purchase Agreement Share Purchase Agreement Share Subscription Agreement Due Diligence Checklist Confidentiality Agreement for Buying/Selling a Business Shareholders' Deed

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Which contract is best for me?

Clicking on the link to one of the specific online Contract Templates listed on this page will give you a description of when that particular contract should be used, and help you decide if it is the right document for your needs.