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A Subscription Agreement outlines the terms and conditions when investors purchase shares or securities in a company. In Saudi Arabia, these agreements play a crucial role in private placements and initial public offerings (IPOs), following Capital Market Authority (CMA) regulations and the Companies Law.

The agreement spells out key details like share price, number of shares, payment terms, and investor rights. It also includes important Saudi-specific provisions about Shariah compliance, foreign ownership limits, and CMA disclosure requirements. Companies and investors use these agreements to create legally binding commitments while ensuring regulatory compliance in the Kingdom's financial markets.

Use a Subscription Agreement when raising capital through share offerings in Saudi Arabia, particularly for private placements or IPOs. The timing is crucial: implement this agreement before accepting any investment funds or issuing shares to new stockholders. This protects both your company and investors under CMA regulations.

The agreement becomes essential during major funding rounds, company expansions, or when bringing in strategic investors. It's especially important for Saudi companies dealing with foreign investors, as it documents compliance with foreign ownership restrictions and Shariah requirements. Having this agreement in place helps avoid disputes and ensures smooth regulatory approvals.

• Shares Subscription Agreement: Core template for direct equity investments, commonly used in private placements with CMA compliance provisions
• Investment Subscription Agreement: Broader version covering various investment instruments, including Shariah-compliant securities
• Software As A Service Subscription Agreement: Specialized for tech companies offering software subscriptions under Saudi tech regulations
• Subscription Service Agreement: For recurring service offerings, emphasizing ongoing performance obligations
• Subscription Service Contract: Detailed version for complex service arrangements with specific performance metrics

• Companies/Issuers: Saudi businesses seeking to raise capital through share offerings, responsible for preparing compliant Subscription Agreements under CMA guidelines
• Investors: Both institutional and individual subscribers purchasing shares, including foreign investors subject to ownership restrictions
• Legal Counsel: Saudi-licensed attorneys who draft and review agreements to ensure Shariah compliance and CMA regulations
• Financial Advisors: Investment banks and financial consultants structuring the offering terms
• CMA Officials: Regulatory staff who review and approve subscription documents for public offerings
• Company Officers: Board members and executives who authorize and execute the agreements

• Company Details: Gather corporate registration documents, shareholder records, and board resolutions authorizing the share issuance
• Investment Terms: Define share price, number of shares, payment schedule, and subscription period
• Investor Information: Collect subscriber details, including NIN for Saudi investors or foreign investor license numbers
• Regulatory Compliance: Review current CMA regulations and Shariah requirements for the specific type of offering
• Documentation: Prepare required attachments like financial statements and company bylaws
• Draft Generation: Use our platform to create a customized, CMA-compliant agreement that includes all mandatory elements
• Internal Review: Verify all terms align with board approvals and company objectives

• Parties Section: Full legal names, registration numbers, and authorized representatives of both issuer and subscriber
• Subscription Details: Precise share quantity, price per share, and total investment amount in Saudi Riyals
• Payment Terms: Clear payment schedule, bank details, and confirmation process
• Shariah Compliance: Explicit statement of compliance with Islamic finance principles
• Representations: Investor eligibility declarations and company's authority to issue shares
• CMA Requirements: Standard disclosures and regulatory compliance statements
• Governing Law: Saudi law application and dispute resolution mechanisms
• Execution Block: Signature requirements meeting Saudi authentication standards

A Subscription Agreement differs significantly from a Bond Purchase Agreement in Saudi Arabia's financial markets. While both involve investment transactions, their structure and regulatory requirements vary considerably under CMA regulations.

• Investment Type: Subscription Agreements deal with equity shares and ownership stakes, while Bond Purchase Agreements cover debt instruments and fixed-income securities
• Shariah Compliance: Bond agreements require specific Islamic finance structures (Sukuk) to ensure compliance, whereas share subscriptions follow standard equity rules
• Risk Profile: Share subscribers become partial owners with voting rights and variable returns, while bondholders receive predetermined profit rates
• Regulatory Framework: Share subscriptions face stricter foreign ownership limits and disclosure requirements compared to bond purchases
• Duration: Subscription Agreements create permanent ownership (unless shares are sold), while bond agreements have fixed maturity dates