Document background
The Preference Share Subscription Agreement is a crucial document used when a company seeks to raise capital by issuing shares with preferential rights to investors. Under German law, this agreement must comply with specific requirements of the Aktiengesetz and other relevant corporate legislation. The document is typically used in growth financing, venture capital investments, or corporate restructuring scenarios where investors require superior rights to ordinary shareholders. The agreement comprehensively outlines the subscription terms, preference share rights (including dividend and liquidation preferences), warranties, and completion mechanics. It also addresses German-specific requirements such as notarization of certain corporate actions and registration with the commercial register (Handelsregister). The document serves as the primary transaction document for preference share investments and often operates alongside other key documents such as a shareholders' agreement and amended articles of association.
