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Rights Agreement

This Rights Agreement template is for use by a company when issuing rights to existing shareholders, allowing them to purchase additional shares in the company before they are offered to the public. It ensures fair and legal allocation of share purchase rights.

Updated 16d ago
rights agreementshareholdersequityfinancinginvestmentcorporate governance

{{company_name}}

{{company_address}}

Phone: {{phone}} | Email: {{email}} | Web: {{website}}

Rights Agreement

Rights Agreement

{{company_name}}

{{company_address}}

Phone: {{phone}}

Email: {{email}}

Website: {{website}}

RIGHTS AGREEMENT

This RIGHTS AGREEMENT ("Agreement") is made and entered into as of this {{day}} day of {{month}}, {{year}} (the "Effective Date"), by and between:

1. **{{company_name}}**, a company duly incorporated under the laws of {{jurisdiction}}, with its registered office at {{company_address}} (hereinafter referred to as the "Company"); and

2. **{{shareholder_name}}**, an individual/entity residing at/with its registered office at {{shareholder_address}} (hereinafter referred to as the "Shareholder").

Collectively referred to as the "Parties".

RECITALS

WHEREAS, the Company deems it desirable and in its best interest to grant rights to its existing shareholders to purchase additional shares of the Company's capital stock.

WHEREAS, the Shareholder is an existing shareholder of the Company and wishes to receive such rights under the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

GRANT OF RIGHTS

The Company hereby grants to the Shareholder {{number_of_rights}} rights (the "Rights") to purchase up to {{number_of_shares}} additional ordinary shares of the Company (the "New Shares"), each with a par value of {{par_value}} ({{currency}}), at a subscription price of {{subscription_price}} ({{currency}}) per New Share.

The Rights are granted on a pro-rata basis to the Shareholder based on their current shareholding in the Company as of the record date, {{record_date}}.

EXERCISE OF RIGHTS

The Shareholder may exercise the Rights, in whole or in part, by delivering to the Company a duly completed and executed Rights Exercise Form (attached hereto as Schedule A) and payment of the aggregate subscription price for the New Shares being subscribed for, on or before {{exercise_deadline}} (the "Exercise Deadline").

Payment shall be made by {{payment_method}} to the Company's bank account: {{bank_name}}, Account Number: {{account_number}}, Branch Code: {{branch_code}}.

Failure to exercise the Rights by the Exercise Deadline shall result in the forfeiture of such unexercised Rights.

TRANSFERABILITY

The Rights granted hereunder are {{transferability_option, e.g., non-transferable / freely transferable / transferable with Company consent}} and may not be sold, assigned, or transferred by the Shareholder without the prior written consent of the Company, subject to applicable securities laws.

REPRESENTATIONS AND WARRANTIES

The Shareholder represents and warrants that it has the full power and authority to enter into this Agreement and to perform its obligations hereunder.

The Company represents and warrants that it has the corporate authority to issue the New Shares and grant the Rights in accordance with its constitutive documents and applicable laws.

GOVERNING LAW AND DISPUTE RESOLUTION

This Agreement shall be governed by and construed in accordance with the laws of {{governing_law_jurisdiction}}.

Any dispute arising out of or in connection with this Agreement, including any question regarding its existence, validity, or termination, shall be referred to and finally resolved by arbitration in {{arbitration_location}} in accordance with the rules of the {{arbitration_institution}}.

GENERAL PROVISIONS

**Entire Agreement:** This Agreement constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior discussions, negotiations, and agreements, whether oral or written.

**Amendments:** No amendment, modification, or waiver of any provision of this Agreement shall be effective unless in writing and signed by both Parties.

**Notices:** All notices hereunder shall be in writing and shall be deemed to have been duly given when delivered by hand, recognized overnight courier, or registered mail to the addresses first set forth above, or to such other address as either Party may designate by notice to the other.

SIGNATURES

IN WITNESS WHEREOF, the Parties have executed this Rights Agreement as of the Effective Date first written above.

**FOR THE COMPANY:**

___________________________

Name: {{company_signatory_name}}

Title: {{company_signatory_title}}

Date: {{date}}

**FOR THE SHAREHOLDER:**

___________________________

Name: {{shareholder_signatory_name}}

Title: {{shareholder_signatory_title}} (if applicable)

Date: {{date}}

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