What Is a Subscription Agreement?

A subscription agreement is a document allowing two parties, like a company and subscriber, to make a deal in advance to sell a certain number of shares at a certain price. This guarantees the company a purchase on the agreed shares at a predetermined price. At the same time, this details everything during the transaction and keeps track on how many shares have been sold by the company.

How to Write a Subscription Agreement

subscription agreement template

Subscription on e-commerce market has grown by more than 100% percent a year over the past 5 years. Obviously, your company wants to compete in the market. Get those subscribers and make the best agreement between two parties for your services.

1. Write Your Company and Investment Details

Introduce your company and the services you offer to your clients. This is one way of advertising your shares to your potential subscribers. Input your company details and investment details on the contract and add necessary information that may enlighten your subscribers about the agreement. Use proper heading and spacing to organize each of your sections on the commercial agreement.

2. Agree on Your Subscription

Agree on the type of subscriptions your subscribers wish to get and provide them instructions about their chosen package. The trends nowadays are online subscription. Identify the amount they wish to purchase as well as their costs, then specify the period when the subscription shall begin and end. Check if your subscribers are qualified to purchase your shares, then input their names on the contract agreement. Joint purchasers must have a separate subscription agreement. Make sure to indicate their full name, tax identification number, and signature.

3. Define Your Subscriber's Responsibilities

Next is to define your subscriber's duties and responsibilities during the subscription period. They should be responsible for the right usage and access of your services in compliance with the law. In addition, you may prohibit your subscribers from accessing or gaining access to other services not offered by your company.

4. Create Your Terms, Suspension, and Termination

Create your terms and conditions during your subscriber's subscription period. Include your suspension and termination of their subscription as well. Place the period of effectivity and expiration of your subscription in your simple agreement, how they may renew their subscription, and when this can be suspended. You may provide monthly subscriptions or yearly subscriptions, it depends on your company's preferences.

5. Specify Your Billing

Don't forget to specify your billing and payment terms in the contract. List down how your subscribers may pay the down payment of the subscription. Though it is ideal to require your subscribers to pay full price in one go, not everybody can afford this. So as an alternative, you may let them to pay you per month, per quarter, or per semester. Just give them ample time to catch up with the fees.

6. Include Other Information

Lastly, input other information on your basic agreement. This includes your license and intellectual property. Your license is important since this certifies your company's authority and copyright on the shares. Provide warranties, liabilities and limitations, and other miscellaneous provisions on your agreement.

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