Share Subscription Agreement for New Zealand

Share Subscription Agreement Template for New Zealand

A Share Subscription Agreement under New Zealand law is a legally binding contract that documents the terms and conditions under which an investor agrees to purchase newly issued shares in a company. The agreement complies with the New Zealand Companies Act 1993 and Financial Markets Conduct Act 2013, incorporating specific local regulatory requirements and corporate law principles. It details the subscription price, number of shares, completion mechanics, warranties, and various rights and obligations of both the issuing company and the subscriber, while ensuring compliance with New Zealand's securities laws and corporate governance requirements.

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What is a Share Subscription Agreement?

The Share Subscription Agreement is a crucial document used in New Zealand when a company is issuing new shares to investors, whether for raising capital, expanding operations, or bringing in strategic partners. This agreement, governed by New Zealand law, particularly the Companies Act 1993 and Financial Markets Conduct Act 2013, sets out the detailed terms of the share subscription, including the number and class of shares being issued, subscription price, completion mechanics, and various conditions precedent. It contains essential protections for both the issuing company and the subscriber through warranties and representations, while ensuring compliance with local regulatory requirements. The document is particularly important in private equity investments, venture capital funding rounds, and strategic corporate investments, providing a clear framework for the transaction and future relationship between the company and its new shareholder.

What sections should be included in a Share Subscription Agreement?

1. Parties: Identifies the company issuing shares and the subscriber(s)

2. Background: Sets out the context of the share subscription, including the company's current share capital and the purpose of the subscription

3. Definitions and Interpretation: Defines key terms used throughout the agreement and sets out interpretation rules

4. Agreement to Subscribe: Core provision detailing the subscriber's agreement to subscribe for shares and the company's agreement to issue them

5. Subscription Price: Specifies the price per share and total subscription amount

6. Completion: Details the completion process, timing, and obligations of each party at completion

7. Conditions Precedent: Lists the conditions that must be satisfied before completion can occur

8. Company's Warranties: Warranties given by the company regarding its status, share capital, and authority to issue shares

9. Subscriber's Warranties: Warranties given by the subscriber regarding capacity, authority, and funding

10. Confidentiality: Obligations regarding confidential information

11. Notices: Specifies how formal notices under the agreement must be given

12. General Provisions: Standard boilerplate clauses including governing law, jurisdiction, and entire agreement

What sections are optional to include in a Share Subscription Agreement?

1. Multiple Completion Dates: Required when the subscription will occur in tranches or stages

2. Tag-Along Rights: Included when minority shareholders are given the right to join in any sale by majority shareholders

3. Drag-Along Rights: Included when majority shareholders can force minorities to join in a sale

4. Board Appointment Rights: Required when the subscriber is given rights to appoint directors

5. Anti-dilution Protection: Included to protect investors from dilution in future capital raises

6. Preferred Rights: Required when the subscription is for preferred shares with special rights

7. Pre-emptive Rights: Included to give existing shareholders first right to purchase new share issues

8. Regulatory Compliance: Required when specific regulatory approvals or compliance is needed

9. Restrictive Covenants: Included when the company needs to agree to certain restrictions post-investment

What schedules should be included in a Share Subscription Agreement?

1. Share Capital Structure: Details of the company's share capital before and after the subscription

2. Completion Requirements: Detailed list of documents and actions required at completion

3. Company Warranties: Detailed warranties given by the company

4. Form of Shareholders' Resolution: Pro-forma resolution approving the share issue

5. Form of Share Certificate: Pro-forma share certificate to be issued

6. Board Resolutions: Pro-forma board resolutions approving the share issue

7. Disclosure Letter: Company's disclosures against the warranties

8. Constitutional Amendments: Any required amendments to the company's constitution

9. Shareholders' Agreement: New or amended shareholders' agreement to be entered into at completion

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

New Zealand

Publisher

Genie AI

Document Type

Agreement Contract

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Technology

Real Estate

Financial Services

Manufacturing

Healthcare

Renewable Energy

Mining and Resources

Agriculture

Retail

E-commerce

Biotechnology

Infrastructure

Professional Services

Education

Media and Entertainment

Relevant Teams

Legal

Finance

Corporate Development

Compliance

Investment

Board of Directors

Company Secretariat

Risk Management

Corporate Finance

Treasury

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Corporate Lawyer

Investment Manager

Company Secretary

Finance Director

Compliance Officer

Investment Analyst

Private Equity Manager

Venture Capital Partner

Corporate Development Manager

Board Director

Financial Controller

Legal Counsel

Investment Banker

Corporate Finance Manager

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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