Subscription letter

A short form letter of application to subscribe for shares.

The subscription letter confirms the number of shares subscribed for, and the amount paid per share. It also authorises the company to add the subscriber's name to the company's register of members.  It refers to the consideration for the shares to be by way of cheque, banker's draft, electronic transfer or release of a debt owed by the company to the subscriber. This letter has been drafted to satisfy sections 583(2) and 583(3)(a) to (c) of the Companies Act 2006 (meaning of payment in cash).

For a short form letter of application where the consideration is by way of an undertaking to pay cash to the company at a future date, see Standard document, Subscription letter: undertaking to pay.

For a long form subscription deed to use when an employee or director subscribes for shares, including a tax indemnity and exclusion clause relating to liabilies for loss on termination, see Standard document, Employee/director subscription deed.

Note that, in a non-leveraged investment round, the investors' subscription and payment for shares will be made pursuant to an investment agreement (see Standard document, Investment agreement: non-leveraged investment).

Howard Palmer, Taylor Wessing


 

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