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A Share subscription deed is a binding legal agreement used when investors buy new shares directly from a company. It sets out the key terms of the share purchase, including the price per share, number of shares, and when payment is due. Australian companies commonly use these deeds for capital raising rounds, particularly when bringing on sophisticated investors or venture capital firms.

The deed protects both parties by clearly documenting important conditions, warranties, and any special rights attached to the shares. It typically includes completion requirements, confidentiality obligations, and steps for resolving disputes under Australian corporate law. Unlike a simple share transfer form, this more comprehensive agreement helps prevent future misunderstandings about the investment terms.

Use a Share subscription deed anytime your company raises capital by issuing new shares to investors. This is especially important for private funding rounds, seed investments, or when bringing strategic investors on board. The deed becomes essential when dealing with multiple investors or complex investment terms that go beyond a simple share purchase.

The agreement particularly helps when your investment includes special conditions like performance targets, staged payments, or specific shareholder rights. Australian companies raising more than $50,000 typically need this level of documentation to satisfy corporate governance requirements and protect all parties' interests. It's also valuable when your investors require detailed warranties about the company's financial position or operations.

• Standard Private Investment: The most common type used for straightforward share issues to private investors, covering basic terms, warranties, and completion mechanics
• Convertible Note Subscription: Includes special provisions for debt-to-equity conversion, typically used by startups with future valuation triggers
• Sophisticated Investor: Enhanced due diligence provisions and compliance with s708 of the Corporations Act for qualified investors
• Employee Share Scheme: Modified terms for staff participation, including vesting schedules and performance conditions
• Multi-party Investment Round: Complex versions handling multiple investors simultaneously, with pro-rata rights and investor hierarchies

• Issuing Companies: Australian businesses looking to raise capital through new share issuance, often startups or growing private companies
• Corporate Lawyers: Draft and review Share subscription deeds, ensuring compliance with the Corporations Act and proper documentation
• Investors: Individual or institutional buyers subscribing to new shares, including venture capitalists, angel investors, and sophisticated investors
• Company Directors: Sign the deed on behalf of the company and provide warranties about the business
• Company Secretaries: Handle administrative aspects, including ASIC notifications and share register updates

• Company Details: Gather current ASIC company extract, share structure, and existing shareholders' information
• Investment Terms: Document share price, number of shares, total investment amount, and payment schedule
• Due Diligence: Compile financial statements, business plans, and material contracts for warranty coverage
• Investor Information: Collect proof of sophisticated investor status or other relevant qualifications
• Special Conditions: List any pre-completion requirements, board rights, or specific investor protections
• Completion Checklist: Create timeline for signing, payment, and share certificate issuance

• Party Details: Full legal names, ACN/ABN numbers, and registered addresses of the company and subscribers
• Share Details: Precise description of share class, quantity, price, and total subscription amount
• Warranties: Company representations about its financial position, assets, and legal status
• Payment Terms: Clear timeline and method for payment of subscription funds
• Completion Mechanics: Steps and timing for share issuance and registration
• Governing Law: Explicit statement that Australian law applies, typically the relevant state jurisdiction
• Execution Block: Proper signing sections for all parties, including witness requirements

A Share subscription deed differs significantly from a Share Purchase Agreement, though they're often confused. The key distinction lies in timing and purpose: a subscription deed deals with newly issued shares directly from the company, while a share purchase agreement handles the transfer of existing shares between shareholders.

• Transaction Type: Subscription deeds involve creating new shares and increasing company capital; purchase agreements merely transfer ownership of existing shares
• Warranties Required: Subscription deeds need extensive company warranties about business condition and compliance; purchase agreements focus on seller's ownership rights
• Regulatory Requirements: Subscription deeds must comply with capital raising rules under the Corporations Act; purchase agreements mainly concern transfer regulations
• Payment Structure: Subscription funds go directly to the company's capital account; purchase payments flow between selling and buying shareholders