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A Subscription letter is a formal agreement used in Belgian investment and financing deals where investors commit to purchasing shares or securities in a company. It outlines key terms like the number of shares, price per share, and payment conditions, serving as legal proof of the investor's commitment.

Under Belgian corporate law, these letters play a crucial role in capital raising and must include specific elements to be legally binding. Companies often use them during private placements, venture capital rounds, or when bringing in new shareholders. The letter creates mutual obligations - the investor promises to provide funds, while the company commits to issuing the agreed securities.

Use a Subscription letter when raising capital for your Belgian company through private investment. This document becomes essential during funding rounds, startup investments, or any situation where new shareholders are joining your company. It provides a clear framework for both parties and helps avoid misunderstandings about investment terms.

The timing is particularly important - send the Subscription letter before finalizing any share transfers or capital increases. Belgian law requires specific documentation for these transactions, and having properly executed Subscription letters streamlines the process with notaries and regulatory authorities. It's especially valuable when dealing with multiple investors or complex investment structures.

• Basic Share Subscription: Most common type used for straightforward equity investments, containing essential terms like share price and quantity
• Conditional Subscription: Includes specific conditions that must be met before the investment becomes binding, such as due diligence completion
• Convertible Note Subscription: Used for investments that can convert into equity later, popular with Belgian startups
• Series Investment: More complex version for institutional investors, including detailed rights and obligations
• Employee Share Subscription: Simplified format for employee stock purchase plans, aligned with Belgian labor laws

• Private Companies: Issue Subscription letters when seeking investment, typically through their board of directors or management team
• Individual Investors: Sign these letters when committing funds, often working with financial advisors to review terms
• Investment Firms: Use standardized Subscription letters for venture capital or private equity investments in Belgian companies
• Corporate Lawyers: Draft and review the letters to ensure compliance with Belgian corporate law and protect client interests
• Notaries: Verify and process Subscription letters as part of their role in Belgian share transfers and capital increases

• Company Details: Gather current shareholder structure, company registration number, and registered office address
• Investment Terms: Define exact number of shares, price per share, and total investment amount
• Investor Information: Collect complete legal identity details and proof of authority to invest
• Payment Terms: Specify payment deadline, bank account details, and any installment arrangements
• Conditions: List any prerequisites like board approval or regulatory clearances
• Supporting Documents: Prepare latest financial statements and shareholder resolutions

• Identification Details: Full legal names and addresses of both company and investor
• Share Information: Precise description of shares, including class, nominal value, and total quantity
• Financial Terms: Subscription price, payment method, and deadline for funds transfer
• Representations: Company's authority to issue shares and investor's capacity to subscribe
• Conditions Precedent: Any requirements before shares can be issued
• Governing Law: Explicit statement of Belgian law application
• Signature Block: Date, place, and authorized signatures with proper capacity stated

A Subscription letter differs significantly from an Engagement Letter in several key aspects, though both are formal business documents used in Belgian professional contexts.

• Primary Purpose: Subscription letters specifically commit to purchasing shares or securities, while Engagement letters outline professional service relationships and terms
• Legal Effect: Subscription letters create binding investment commitments under Belgian corporate law, whereas Engagement letters establish service obligations and expectations
• Timing: Subscription letters are used during specific capital-raising events, while Engagement letters typically mark the start of ongoing professional relationships
• Content Focus: Subscription letters detail share quantities, prices, and payment terms, while Engagement letters outline scope of services, fees, and professional responsibilities
• Parties Involved: Subscription letters are between companies and investors, while Engagement letters usually involve service providers and clients