This rights agreement template has 15 pages and is a MS Word file type listed under our legal agreements documents.
Sample of our rights agreement template:
RIGHTS AGREEMENT This Rights Agreement (the "Agreement") is effective [DATE], BETWEEN: [YOUR COMPANY NAME], (the "Company") registered under the laws of [State/Province] of [STATE/PROVINCE] with its head office located at: [YOUR COMPLETE ADDRESS] AND: [RIGHTS AGENT NAME], (the "Rights Agent") registered under the [State/Province] of [STATE/PROVINCE] with its head office located at: [YOUR COMPLETE ADDRESS] WHEREAS, the Board of Directors have declared a dividend distribution for the Common Stock of the Company, outstanding as of the closure of the business on [DATE]; WHEREAS, the Company appoints the Rights Agent who shall issue the Rights Certificate to each of the Shareholders; WHEREAS, the Shareholders shall exercise the right to receive additional Rights given to them by the Company; WHEREAS, the Company and Rights Agent wish to evidence their contract in writing; NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS: DEFINITIONS "Acquiring Person" shall mean any Person (as such term is hereinafter defined) who or which, together with all Affiliates (as such term is hereinafter defined) and Associates (as such term is hereinafter defined) of such Person, shall be the Beneficial Owner (as such term is hereinafter defined) of the shares of Common Stock. A Person shall be deemed the "Beneficial Owner" of, and shall be deemed to "beneficially own," any securities: which such Person or any of such Person's Affiliates or Associates beneficially owns, directly or indirectly; which such Person or any of such Person's Affiliates or Associates has the right or obligation to acquire (whether such right or obligation is exercisable or effective immediately or only after the passage of time) pursuant to any agreement, arrangement or understanding. "Business Day" shall mean any day other than a Saturday, Sunday, or a day on which banking institutions in the [PROVINCE/STATE] of [SPECIFY PROVINCE/STATE] are authorized or obligated by law or executive order to close. "Close of Business" on any given date shall mean 5:00 P.M., Eastern time, on such date; provided, however, that if such date is not a Business Day it shall mean 5:00 P.M., Eastern time, on the next succeeding Business Day. "Common Stock" shall have the meaning set forth in the Recitals hereof, except that "Common Stock," when used with reference to stock issued by any Person other than the Company, shall mean the capital stock with the greatest Voting Power, or the equity securities or other equity interest having power to control or direct the management, of such Person, or, if such Person is a Subsidiary of another Person, of the Person which ultimately controls such first-mentioned Person and which has issued such capital stock, equity securities or equity interests. "Person" shall mean any individual, firm, corporation, partnership, joint venture, association, trust or other entity. "Preferred Stock" shall mean the Series of a Participating Preferred Stock, $0.001 par value of the Company. "Stock Acquisition Date" shall mean the first date of public announcement by the Company or an Acquiring Person that an Acquiring Person has become such. A "Subsidiary" of any Person shall mean any corporation or other entity of which a majority of the Voting Power of the voting equity securities or voting interests is owned, directly or indirectly, by such Person, or which is otherwise controlled by such Person. "Voting Power" shall mean the Voting Power of all securities of the Company then outstanding and generally entitled to vote for the election of directors of the Company. APPOINTMENT OF RIGHTS AGENT The Company hereby appoints the Rights Agent to act as agent for the Company and the holders of the Rights (who, in accordance with this Agreement, shall prior to the Distribution Date also be the holders of the Common Stock) in accordance with the terms and conditions hereof, and the Rights Agent hereby accepts such appointment. The Company may from time to time appoint such Co-Rights Agents as it may deem necessary or desirable upon [NUMBER OF DAYS] days prior written notice to the Rights Agent. The Rights Agent shall have no duty to supervise, and shall in no event be liable for, the acts or omissions of any such Co-Rights Agent. In the event the Company appoints one or more Co-Rights Agents, the respective duties of the Rights Agents and any Co-Rights Agents shall be as the Company shall determine. ISSUE OF RIGHTS CERTIFICATES Until the earlier of (i) the Stock Acquisition Date or (ii) the tenth day after the date of the commencement of, or first public announcement of the intent of any Person (other than the Company, any Subsidiary of the Company, or any employee benefit plan of the Company or any of its Subsidiaries) to commence (which intention to commence remains in effect for five (5) Business Days after such announcement), a tender or exchange offer which would result in such Person becoming an Acquiring Person, the Rights Agent shall send by first-class, insured, postage prepaid mail, to each record holder of the Common Stock as of the Close of Business on the Distribution Date, at the address of such holder shown on the records of the Company, a certificate for Rights, in substantially the form of Exhibit A hereto (the "Rights Certificates"), evidencing one Right for each share of Common Stock so held. As of and after the Distribution Date, the Rights shall be evidenced solely by such Rights Certificates. As soon as practicable following the Record Date, the Company shall send a copy of a Summary of Rights, in substantially the form attached hereto as Exhibit B (the "Summary of Rights"), by first-class, postage prepaid mail, to each record holder of the Common Stock as of the Close of Business on the Record Date, at the address of such holder shown on the records of the Company. With respect to certificates for the Common Stock outstanding as of the Record Date, until the Distribution Date (or earlier redemption, expiration or termination of the Rights), the Rights shall be evidenced by such certificates for the Common Stock, and the registered holders of the Common Stock shall also be the registered holders of the associated Rights. Until the Distribution Date (or earlier redemption, expiration or termination of the Rights), the surrender for transfer of any of the certificates for the Common Stock outstanding on the Record Date, even without a copy of the Summary of Rights attached thereto, shall also constitute the transfer of the Rights associated with the Common Stock represented by such certificate. Certificates issued for Common Stock (including, without limitation, certificates issued upon transfer or exchange of Common Stock) after the Record Date, but prior to the earlier of the Distribution Date or the Expiration Date, shall have impressed, printed, stamped, written or otherwise affixed onto them the following legend [section 3.4]: This certificate also evidences and entitles the holder hereof to certain Rights as set forth in a Rights Agreement between the Company and the Rights Agent (the "Rights Agreement"), the terms of which are hereby incorporated herein by reference and a copy of which is on file at the principal offices of the Company. Under certain circumstances, as set forth in the Rights Agreement, such Rights may be redeemed, may expire, or may be evidenced by separate certificates and will no longer be evidenced by this certificate. The Company will mail to the holder of this certificate a copy of the Rights Agreement without charge within five days after receipt of a written request therefor. Under certain circumstances, Rights issued to Acquiring Persons (as defined in the Rights Agreement) or certain related Persons and any subsequent holder of such Rights may become null and void.
