A Share Subscription Letter is a document that is executed by a party wishing to subscribe for shares in a company.
A Share Subscription Letter sets out the number of shares requested, the price that will be paid for the shares, and the method of payment.
A Share Subscription Letter is a formal request to apply for an allotment of shares in a company. While it is not mandatory, it is good practice to request that prospective investors document their application for the shares in the form of a Share Subscription Letter.
If required, the letter may also provide an undertaking on the part of the prospective investor to pay the subscription monies for such shares either in full and on demand or by attaching a proof of payment to the letter.
When drafting a Share Subscription Letter, it is important to focus on a number of key clauses, in particular.