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A Share subscription deed is a binding legal agreement used in UAE business transactions when someone wants to buy shares in a company. It sets out the exact terms under which an investor will purchase shares, including the price per share, total investment amount, and any special conditions that must be met before the deal closes.

Under UAE Commercial Companies Law, this deed plays a crucial role in protecting both parties by clearly documenting payment schedules, shareholder rights, and company obligations. It's particularly important in free zones and mainland companies where foreign ownership restrictions apply, as it helps ensure compliance with local investment regulations while giving investors clear legal recourse if issues arise.

Use a Share subscription deed when bringing new investors into your UAE company, especially during funding rounds or company expansions. This document becomes essential when negotiating complex investment terms, such as staged payments, performance conditions, or specific shareholder rights in mainland or free zone entities.

The deed proves particularly valuable during pre-IPO preparations, joint ventures, or when dealing with foreign investors under UAE ownership rules. It helps prevent future disputes by clearly documenting the investment timeline, share valuation methods, and any warranties about the company's financial position. Having this formal agreement in place makes the investment process smoother and creates a clear paper trail for regulatory compliance.

• Standard Subscription Deed: Used for straightforward share purchases in UAE private companies, covering basic terms like price, quantity, and payment schedule
• Staged Investment Deed: Structures payments in multiple tranches based on company milestones or timeline triggers
• Free Zone Subscription Deed: Tailored for free zone companies with specific foreign ownership provisions and zone-specific compliance requirements
• Convertible Subscription Deed: Links share subscription to future events like IPOs or includes conversion rights from other securities
• Mainland Company Deed: Incorporates UAE local ownership requirements and specific mainland company regulations

• Company Directors: Negotiate and approve the Share subscription deed terms, representing the issuing company's interests and ensuring compliance with UAE corporate laws
• Investors: Review and sign the deed when purchasing shares, often through their legal representatives in major transactions
• Corporate Lawyers: Draft and review the deed, ensuring it meets UAE legal requirements and protects all parties' interests
• Company Secretaries: Handle documentation, maintain records, and coordinate with regulatory authorities
• Regulatory Bodies: Monitor compliance with UAE ownership rules and investment regulations, particularly in free zones

• Company Details: Gather accurate corporate information, including trade license, articles, and current shareholding structure
• Investment Terms: Document share price, quantity, payment schedule, and any special rights or restrictions
• Due Diligence: Collect financial statements, valuation reports, and compliance certificates
• Ownership Verification: Confirm UAE ownership requirements for your business type and location
• Regulatory Approvals: Check required permits and authorizations from relevant UAE authorities
• Signature Authority: Verify who has legal power to sign on behalf of each party

• Party Details: Full legal names, addresses, and registration numbers of the company and subscribers
• Share Information: Precise details of share class, quantity, price, and payment terms
• Warranties: Company's representations about its financial position and legal status
• Conditions Precedent: Requirements to be met before shares are issued
• Completion Mechanics: Clear timeline and process for share transfer execution
• UAE Compliance: References to relevant UAE Companies Law provisions and ownership restrictions
• Governing Law: Explicit statement of UAE jurisdiction and applicable regulations

A Share subscription deed differs significantly from a Shareholder Agreement in several key aspects, though both are crucial documents in UAE corporate governance. While a Share subscription deed focuses on the initial purchase and issuance of shares, a Shareholder Agreement governs the ongoing relationship between shareholders.

• Timing and Purpose: Share subscription deeds are used during the actual investment process, while Shareholder Agreements guide long-term relationships after shares are issued
• Scope of Coverage: Subscription deeds focus on payment terms, share allocation, and conditions for completion, while Shareholder Agreements cover voting rights, dividend policies, and exit mechanisms
• Legal Requirements: Under UAE law, subscription deeds must comply with specific share issuance regulations, while Shareholder Agreements focus on company management and shareholder rights
• Duration: Subscription deeds typically conclude once shares are issued, while Shareholder Agreements remain active throughout the shareholders' involvement