Document background
A Preference Shares Agreement is a crucial document used when a company wishes to issue shares with special rights and privileges that differ from ordinary shares. This agreement, governed by Australian law and complying with the Corporations Act 2001 (Cth), is commonly used for raising capital while maintaining existing voting control structures or providing investors with priority rights to dividends and capital returns. The document sets out comprehensive terms including dividend rights, voting rights, redemption or conversion rights, and capital return priorities. It's particularly relevant for companies seeking to attract strategic investors or structure complex financing arrangements while maintaining flexibility in their capital structure. The agreement must address specific requirements under Australian corporate law and ASIC regulations, making it essential for both private and public companies engaging in preference share issuances.
