Warrant Purchase Agreement Template for England and Wales

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Key Requirements PROMPT example:

Warrant Purchase Agreement

"I need a Warrant Purchase Agreement for my UK-based technology startup to issue warrants to a venture capital investor, with an exercise period of 5 years and anti-dilution protection, to be completed by March 2025."

Document background
The Warrant Purchase Agreement is commonly used in corporate financing transactions where companies seek to provide investors with additional incentives or rights to purchase equity. This document is essential when structuring investments under English and Welsh law, particularly in scenarios involving venture capital, private equity, or strategic investments. The agreement typically includes detailed terms about warrant pricing, exercise periods, anti-dilution provisions, and transfer restrictions, while ensuring compliance with UK securities regulations and corporate law requirements.
Suggested Sections

1. Parties: Identification of the parties entering into the agreement, including full legal names and registered addresses

2. Background/Recitals: Context of the warrant issuance and key commercial understanding between parties

3. Definitions and Interpretation: Key terms used throughout the agreement and rules of interpretation

4. Purchase and Sale of Warrants: Core terms of the warrant purchase, including number of warrants, purchase price, and payment terms

5. Exercise of Warrants: Terms and conditions for exercising the warrants, including exercise price and period

6. Representations and Warranties: Standard representations from both parties regarding authority, capacity, and compliance

7. Covenants: Ongoing obligations of the parties during the warrant term

8. Transfer Restrictions: Limitations on the transfer of warrants to third parties

9. General Provisions: Standard boilerplate clauses including notices, amendments, governing law

Optional Sections

1. Registration Rights: Rights to register underlying shares for public trading - include when warrants are exercisable for shares that may need to be registered with regulatory authorities

2. Anti-dilution Provisions: Protections against dilution of warrant value - include when warrantholder requires protection against future share issuances

3. Tag-Along Rights: Right to participate in future sales - include when warrantholder wants protection in case of company sale

4. Information Rights: Rights to receive company information - include when warrantholder requires ongoing access to company information

Suggested Schedules

1. Form of Warrant Certificate: Template of the actual warrant certificate to be issued

2. Exercise Notice: Form to be completed when exercising warrants

3. Shareholders' Agreement: Agreement governing relationship between shareholders following warrant exercise

4. Company Information: Key company details including capital structure

5. Calculation Methods: Detailed methods for calculating adjustments to warrant terms

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions
Relevant Industries
Relevant Teams
Relevant Roles
Industries

Companies Act 2006: Primary legislation governing company law in the UK, particularly relevant for sections relating to share capital and transferable securities

Financial Services and Markets Act 2000 (FSMA): Key legislation regulating financial services and markets in the UK, providing framework for securities regulation

Financial Services Act 2012: Updates and amends FSMA, establishing regulatory framework for financial services

FSMA Regulated Activities Order 2001: Specifies which activities require FCA authorization and regulates financial instruments including warrants

Public Offers of Securities Regulations 1995: Regulates the offering of securities to the public in the UK

UK Market Abuse Regulation: Provides framework for preventing and detecting market abuse and insider trading

UK Corporate Governance Code: Sets standards of good practice for listed companies on board composition and development, remuneration, shareholder engagement, and corporate reporting

Law of Property (Miscellaneous Provisions) Act 1989: Governs formalities for creation and transfer of interests in property, including certain aspects of security interests

Unfair Contract Terms Act 1977: Regulates contracts by restricting how far civil liability for breach of contract can be avoided

Income Tax Act 2007: Governs taxation of income, including treatment of securities and warrant-related income

Corporation Tax Act 2010: Regulates corporate taxation aspects of securities and financial instruments

Money Laundering Regulations 2017: Sets requirements for due diligence and anti-money laundering procedures in financial transactions

Competition Act 1998: Regulates anti-competitive behavior and may be relevant for larger warrant transactions or those affecting market competition

FCA Handbook: Contains detailed rules and guidance from the Financial Conduct Authority on financial instruments and market conduct

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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