Subscription Agreement and Fund Document Updates for Tokenized Interests

Gofaizen & Sherle can review a fund subscription agreement, identify tokenization-related legal and regulatory gaps, and explain what must change before launch.

For tokenized funds, a fund interest is a unit or share represented digitally using distributed ledger technology (DLT). The token does not replace the rights in the fund documents. A subscription agreement for tokenized fund interests must match the fund rules, ownership register, investor procedures, and technology.

Which fund documents should be reviewed together?

The subscription agreement should not be reviewed on its own. The review normally covers:

• the offering document and constitutional (governing) documents
• the subscription agreement and token terms
• investor disclosures and transfer or custody policies
• agreements with the fund administrator, transfer agent or registrar, custodian, onboarding provider, and technology providers.

The aim is to find gaps or conflicts. Documents that already fit the model need not be rewritten.

Which clauses need a tokenization-specific check?

The review should check:

• investor eligibility and which wallets may be used
• when subscriptions are accepted and token issuance takes place
• which transfer restrictions apply and how ownership is recorded
• what happens if a wallet, its private key (access credential), or a record is lost or changed
• how errors, record corrections, technology failures, and suspensions are handled
• how distribution and redemption work
• the investor’s consent to freeze, forced transfer, burn and reissue, and to corrections of the ownership record, together with who may authorise each action and on what evidence.

These clauses must match the operating process. A smart contract is software that applies rules automatically. It and connected smart contracts must follow the fund documents and procedures used by service providers.

Why do amendments vary by jurisdiction?

The required changes depend on the jurisdiction, fund type, investor category, and distribution model. These factors can affect who may invest, what information investors must receive, and whether a DLT record can serve as the official ownership register.

What should the document review deliver?

A scoped review can provide:

• a prioritized list of document gaps
• clear drafting instructions and an amendment plan
• amended documents where agreed
• an implementation checklist showing which system rule or procedure applies and which providers are responsible for each requirement.

If possible, send us the current fund and subscription documents, draft token terms, fund type, investor categories, distribution markets, target jurisdictions, proposed ownership-record model, and current project stage.