Waiver of pre-emption rights: share issue

When do I use this document?

• when a shareholder waives pre-emption rights on the proposed issue of shares by the company
• when the shareholder agrees to waive its first refusal rights under either the company’s Articles of Association or Shareholders Agreement

What are the key features?

• different forms of waiver, depending on whether the waiving shareholder is an individual or a company
• optional wording based on whether the pre-emption rights are in the Articles of Association or Shareholders Agreement
• waiver in the form of a Deed

What else do I need to know?

Shareholders may have pre-emption rights on a proposed allotment of new shares by the company.  These rights act as a right of first refusal, allowing existing shareholders to acquire shares before they can be issued to someone else, whether to other existing shareholders or to new investors.

The rights are typically contained in either the company’s Shareholders Agreement, Articles of Association, or both.  The provisions may specify that the pre-emptive rights can be waived either by individual shareholders or by shareholders holding a specified percentage of the total share capital.  

What other documents are available?

For a deed of waiver of pre-emption rights on a proposed transfer of existing shares, see

• Waiver of pre-emption rights – share transfer