What is a share subscription agreement?
A share subscription agreement is used when a company raises money by issuing new shares. The investor pays the company (not an existing shareholder), and in return gets newly created shares. It is the simplest written form of an angel or friends-and-family equity round.
This template covers the number and class of shares, the price per share and total, the payment deadline, how quickly the company issues the shares and updates its register, the approvals the company must have, the use of funds, the company's promises about the shares, the investor's acknowledgement of risk and eligibility under securities laws, information rights and joining any shareholders' agreement.
- Best for
- Small equity raises from angels, friends and family, or a strategic investor
- Signed by
- The company and the investor
- Investor information
- Annual accounts, plus optional quarterly or monthly updates
- Length
- About 2 pages, initialled on every page
When to Use a share subscription agreement
- A founder bringing in an angel investor
- Friends and family investing in a new business
- A strategic partner taking a minority stake
- An employee or adviser buying new shares at a set price
- Topping up a round with a late investor on the same terms
What You Fill In
17 blanks, then the name and email of each person who signs: company, investor.
1 The parties
- Date of this agreement*
- Company*
- Company or registration number
- Company address
- Investor (person or company)*
- Investor address
2 The investment
- Number of new shares*
- Class of shares*
- Currency*
- Price per share*
- Total subscription amount*
- Investor's shareholding after the issue
3 Completion
- Days to pay after signing*
- Company bank account for payment
- Use of the money
4 Investor rights
- Information for the investor* annual accounts only · annual accounts and a short quarterly update · annual accounts and monthly management accounts
- Governing law*
5 Who signs
- Company signature and date, job title, initials on every page · A director or authorised officer signs for the company.
- Investor signature and date, job title, initials on every page
What the share subscription agreement Covers
- Subscription
- Payment and issue
- Approvals
- Use of funds
- Company's promises
- Investor's promises
- Information and further documents
- General
Using the share subscription agreement, step by step
1 Enter the company and investor
Name the company and the investor, with addresses and the company's registration number.
2 Set the investment
Enter the number and class of new shares, price per share and total. Add the expected post-investment percentage if you have calculated it.
3 Set payment and use of funds
Choose the payment deadline and, if you like, include bank details and what the money is for. Confirm bank details by phone before any transfer.
4 Choose information rights and sign
Pick what the investor receives, enter the governing law and send. The issued agreement is stored in VergeHR Files.
Tips Before You Send It
- Issuing shares usually needs board and sometimes shareholder approval, and existing shareholders may have pre-emption rights. Sort these out first.
- Selling shares to investors is regulated almost everywhere. Make sure the offer fits an exemption and that the investor qualifies.
- After the issue, update the register of shareholders and make any registry filing required.
- If you have a shareholders' agreement, have the investor sign up to it at the same time.
Sign It Online In Minutes
- Fill in the blanks. Names, dates and amounts go straight into the agreement — the preview shows exactly where.
- Name who signs. Tick “This is me” for your own part. VergeHR builds the PDF with every signature, date and initials box on the right line, and you can check or move anything before sending.
- Send it. Each signer gets a secure link and signs from any device — no account needed. The signed PDF, with an audit trail and a Certificate of Completion, is filed in Files and emailed to everyone.
Share subscription agreement: frequently asked questions
What is the difference between a subscription and a share purchase?
In a subscription the company creates and issues new shares and receives the money. In a share purchase an existing shareholder sells shares they already own and keeps the money.
Is this the same as a SAFE or convertible note?
No. Those give the investor a right to shares later, usually at the next priced round. This template issues shares now at a fixed price.
Do we need a lawyer?
For anything beyond a simple round it is wise. Securities law, tax treatment and share rights vary by country and can have lasting effects.
Can the investor sign electronically?
Generally yes for the agreement. VergeHR records an audit trail and Certificate of Completion with the signed PDF.