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A Share subscription deed is a binding legal agreement that outlines how investors will purchase shares in a Saudi company. It spells out the key terms of the investment, including the number of shares, price per share, and payment schedule. This document plays a vital role in Saudi private equity deals and company formations under the Kingdom's Companies Law.

Beyond just recording the share purchase, the deed protects both parties by clearly stating important conditions like corporate approvals, payment terms, and any special rights attached to the shares. It also helps ensure compliance with Capital Market Authority regulations and serves as proof of the transaction for Ministry of Commerce registration purposes.

Use a Share subscription deed when raising capital through share issuance in Saudi Arabia, particularly during startup funding rounds, private placements, or company expansions. This document becomes essential once you've identified investors and agreed on basic investment terms but need to formalize the arrangement before transferring shares.

The timing is crucial - implement it after initial negotiations but before any money changes hands. Saudi companies must have this deed ready for Ministry of Commerce registration, especially when bringing in new shareholders or increasing capital. It's particularly important for joint stock companies and limited liability companies seeking to document share transfers in compliance with CMA regulations.

• Basic Share Subscription Deed: Covers standard share purchases with straightforward payment terms and basic warranties - commonly used for small private companies
• Conditional Share Subscription Deed: Includes specific performance conditions or milestones before shares are issued - popular in startup funding
• Multiple Investor Deed: Structured for rounds with several subscribers, including pro-rata rights and investor coordination provisions
• Employee Share Scheme Deed: Tailored for staff share programs with vesting schedules and employment-linked conditions under Saudi labor laws
• Strategic Investment Deed: Contains enhanced rights, board seats, and special provisions for major corporate investors under CMA regulations

• Company Directors: Approve and execute the Share subscription deed on behalf of the issuing company, ensuring compliance with Saudi corporate law
• Investors: Review and sign the deed, committing to purchase shares under specified terms and conditions
• Legal Counsel: Draft and review the deed, ensuring it meets CMA requirements and protects all parties' interests
• Company Secretary: Maintains corporate records and handles Ministry of Commerce registration requirements
• Financial Advisors: Structure the share offering terms and validate compliance with Saudi investment regulations

• Company Details: Gather current commercial registration, articles of association, and board resolutions authorizing the share issuance
• Share Information: Document exact number of shares, price per share, and total subscription amount in Saudi Riyals
• Investor Details: Collect full legal names, ID/CR numbers, and contact information for all subscribing parties
• Payment Terms: Specify payment schedule, bank account details, and any conditions precedent
• Regulatory Compliance: Ensure alignment with CMA regulations and Ministry of Commerce requirements
• Supporting Documents: Prepare shareholder approvals, valuation reports, and required corporate authorizations

• Parties Section: Full legal names, addresses, and registration details of the company and subscribers
• Share Details: Precise description of shares, class, rights, and total subscription amount in SAR
• Payment Terms: Clear payment schedule, bank details, and consequences of default
• Warranties: Company's authority to issue shares and subscriber's capacity to invest
• Regulatory Compliance: References to Saudi Companies Law and CMA regulations
• Governing Law: Explicit statement of Saudi law jurisdiction and dispute resolution mechanism
• Execution Block: Signature spaces for authorized representatives with witness provisions

A Share subscription deed is often confused with a Share Purchase Agreement, but they serve distinct purposes in Saudi Arabian corporate transactions. While both documents deal with share ownership, their timing and function differ significantly.

• Transaction Type: Share subscription deeds handle new share issuance directly from the company, while Share Purchase Agreements transfer existing shares between shareholders
• Regulatory Requirements: Subscription deeds must comply with CMA regulations for capital increases, whereas Purchase Agreements focus on transfer restrictions and existing shareholder rights
• Payment Structure: Subscription funds go directly to the company's capital account, while Purchase Agreement payments flow between shareholders
• Documentation: Subscription deeds require additional corporate approvals and Ministry of Commerce registration for capital increase, unlike straightforward share transfers