Registration rights clause: Copy, customize, and use instantly
Introduction
A registration rights clause provides certain rights to investors or shareholders to demand that a company register their securities with the relevant authorities, allowing them to sell those securities in the public market. This clause is typically included in private investment agreements and protects investors' ability to liquidate their investment by ensuring that their securities can be sold or transferred publicly. It outlines the conditions, process, and timing for such registrations.
Below are templates for registration rights clauses tailored to different scenarios. Copy, customize, and insert them into your agreement.
Standard registration rights clause
This is a basic registration rights clause giving the investor the right to demand a registration of their shares.
The [Company] agrees to file a registration statement with the Securities and Exchange Commission (SEC) within [X] days after receiving a written request from the [investor/shareholder] to register the shares held by the [investor/shareholder]. The Company shall use its commercially reasonable efforts to cause the registration to become effective as soon as practicable.
Piggyback registration rights clause
This variation allows investors to include their shares in a public offering initiated by the company.
In the event the [Company] proposes to register any of its securities under the Securities Act of 1933 (the "Securities Act") in connection with a public offering, the [investor/shareholder] shall have the right to include their shares in such registration on the same terms as the shares being registered by the Company. The Company shall give the [investor/shareholder] written notice of such proposed registration at least [X] days before filing the registration statement.
Demand registration rights clause
This clause allows investors to demand that the company register their shares for a public offering.
The [investor/shareholder] shall have the right to request the Company to register their shares under the Securities Act, provided that such request is made no more than [X] times and only if the proposed registration covers at least [X]% of the outstanding shares of the Company. The Company shall file a registration statement within [X] days of receiving such demand and use commercially reasonable efforts to cause the registration to become effective.
Secondary offering registration rights clause
This variation allows for the registration of securities when the company or another shareholder is conducting a secondary offering.
In the event that the [Company] or any shareholder conducts a secondary public offering, the [investor/shareholder] shall have the right to include their securities in the registration for such offering. The Company shall notify the [investor/shareholder] within [X] days of its intention to file a registration statement for such an offering and provide the [investor/shareholder] with the opportunity to include their shares.
Shelf registration rights clause
This clause allows for a shelf registration, enabling the investor to sell securities over time.
The Company agrees to file a shelf registration statement under the Securities Act that permits the [investor/shareholder] to sell their shares at any time over a period of [X] months or years. The Company shall use commercially reasonable efforts to cause the registration statement to remain effective for such period and shall notify the [investor/shareholder] of any issues with maintaining such registration.
Priority registration rights clause
This clause gives certain investors priority registration rights over others in case of limited availability.
In the event the [Company] receives multiple requests for registration, the [investor/shareholder] shall have priority over other shareholders in the registration of their shares, provided that the shares of the [investor/shareholder] do not exceed [X]% of the total number of shares being registered. The Company shall allocate space for such shares in the registration statement accordingly.
Right to withdraw registration rights clause
This clause allows the investor to withdraw their request for registration under certain conditions.
The [investor/shareholder] shall have the right to withdraw their request for registration at any time before the effectiveness of the registration statement, provided that such withdrawal is made within [X] days after submitting the request for registration. Upon such withdrawal, the Company will be relieved of its obligations under this clause.
Lock-up period registration rights clause
This clause restricts the ability to sell shares for a specific period after registration.
The [investor/shareholder] agrees not to sell, transfer, or otherwise dispose of any shares registered under this clause for a period of [X] days following the effective date of the registration statement, provided that the lock-up period is imposed by the underwriters in connection with a public offering. The lock-up period may be extended by the underwriters for up to an additional [X] days.
Registration rights in the case of corporate transactions clause
This variation addresses registration rights in the event of a merger or acquisition.
In the event of a merger, acquisition, or other corporate transaction where the [investor/shareholder]’s shares are to be exchanged for securities of another entity, the [investor/shareholder] shall have the right to demand that the acquiring entity file a registration statement under the Securities Act to register such securities for public sale, provided that the shares are not restricted by the terms of the transaction.
Indemnification for registration rights clause
This clause includes provisions for indemnification in connection with the registration process.
In connection with any registration statement filed by the Company under this clause, the Company agrees to indemnify the [investor/shareholder] from any liabilities arising under the Securities Act in connection with the registration and sale of their securities, except where such liabilities arise from the misrepresentation or omission by the [investor/shareholder].
Registration rights clause with special terms for convertible securities
This variation grants registration rights to investors holding convertible securities.
The [Company] agrees to register the shares issuable upon conversion of any convertible securities held by the [investor/shareholder] under the Securities Act. Upon the request of the [investor/shareholder], the Company shall file a registration statement to register these shares, and the [investor/shareholder] shall have the right to include these shares in the registration.
Registration rights clause with condition for minimum offering size
This clause limits registration rights to instances where the offering size is substantial.
The [investor/shareholder] may request the Company to file a registration statement under the Securities Act, but only if the total number of shares being registered is at least [X]% of the total outstanding shares of the Company. If the total offering size does not meet this threshold, the Company shall not be required to file a registration statement.
Registration rights clause with waiver of rights
This clause allows for the waiver of registration rights under certain circumstances.
The [investor/shareholder] may waive their registration rights at any time, either in whole or in part, in writing. Such waiver shall not affect the rights of other investors or shareholders who have not waived their registration rights under this agreement.
Post-closing registration rights clause
This variation provides for registration rights after the closing of a funding round.
The [investor/shareholder] shall have the right to request the Company to file a registration statement under the Securities Act within [X] days following the closing of the [investment round]. The Company agrees to make commercially reasonable efforts to file the registration statement and cause it to become effective.
Sequential registration rights clause
This clause provides investors with the right to sequential registrations under certain conditions.
The [investor/shareholder] shall have the right to request up to [X] separate registration filings under the Securities Act, with each registration request occurring no more than [Y] months after the previous request. The Company agrees to honor the registration rights within [X] business days of receiving such a request.
Waiver of registration rights clause
This clause allows the Company to seek a waiver of registration rights under specific circumstances.
The [Company] may request a waiver of any registration rights granted hereunder if the [investor/shareholder]’s shares are subject to lock-up agreements or other restrictions under an underwriting agreement for a public offering. The waiver request shall be considered and approved by the [investor/shareholder] in writing, which approval shall not be unreasonably withheld.
Registration rights clause with priority in future offerings
This variation ensures priority registration rights in future offerings.
If the [Company] conducts a public offering of its securities, the [investor/shareholder] shall have priority over other shareholders in the registration of their securities, subject to the limitations imposed by the underwriters or the company’s underwriter. The priority will apply unless the number of shares being offered exceeds [X]% of the total offering.
Limited registration rights clause
This clause limits registration rights to a specific number of securities.
The [investor/shareholder] may request registration rights for a limited number of shares, not exceeding [X] shares, under the Securities Act. The Company will not be obligated to register more than the specified number of shares unless otherwise agreed by both parties in writing.
Registration rights clause with a filing fee provision
This clause clarifies who is responsible for paying filing fees associated with the registration.
The Company agrees to pay all filing fees and expenses associated with the registration of the [investor/shareholder]’s shares under the Securities Act, including legal and accounting fees, except for any costs incurred by the [investor/shareholder] for legal counsel or other expenses not directly related to the registration filing.
Registration rights clause with underwriting rights
This variation gives the investor the right to participate in the underwriting of a public offering.
The [investor/shareholder] shall have the right to participate in the underwriting process of any public offering conducted by the Company, provided that the shares held by the [investor/shareholder] are included in the registration statement. The investor's participation will be on the same terms as other selling shareholders, subject to underwriter limitations.
Registration rights clause with demand limitation
This variation limits the number of times an investor can request registration.
The [investor/shareholder] may request that the Company register their shares under the Securities Act only [X] times during the term of this Agreement. The first request shall be made within [X] months after the date of this Agreement, and subsequent requests may be made at [X]-month intervals.
Registration rights clause with market conditions provision
This variation includes a market condition provision that can delay registration.
The [Company] shall file a registration statement under the Securities Act within [X] days of the [investor/shareholder]'s request, but the filing may be delayed or postponed if, in the opinion of the Company’s legal counsel or underwriters, the market conditions are not favorable for a public offering at that time. The registration shall be filed when market conditions improve.
Registration rights clause with registration only for resale
This clause restricts the registration rights to shares that are being resold by the investor.
The [investor/shareholder] shall have the right to request the Company to register their shares under the Securities Act only for the purpose of resale. The shares to be registered must be those the [investor/shareholder] intends to sell in the public market, and no other shares will be eligible for registration under this provision.
Registration rights clause with compliance with regulations
This variation emphasizes the Company’s obligation to comply with regulatory requirements when registering shares.
The Company shall file a registration statement with the Securities and Exchange Commission (SEC) within [X] days of receiving a request from the [investor/shareholder], and shall comply with all applicable securities laws and regulations in connection with the registration. The Company shall bear all reasonable costs associated with the registration except for any costs incurred by the [investor/shareholder].
Registration rights clause with right to request a follow-up registration
This clause grants the right to request an additional registration after the first one.
The [investor/shareholder] shall have the right to request a second registration under the Securities Act for any shares that were not included in the first registration, provided that the second request is made within [X] months of the first registration becoming effective. The Company shall comply with such a request, subject to availability under the registration provisions.
Registration rights clause with exclusions for certain securities
This clause excludes certain securities from the registration rights provision.
The registration rights granted hereunder shall not apply to shares issued under a Company employee stock option plan or any shares that are subject to restrictions or lock-up periods. The Company shall only register shares held by the [investor/shareholder] that are freely tradable under the Securities Act.
Registration rights clause with waiver of rights in certain circumstances
This variation includes a waiver provision in certain situations where the registration rights are waived.
The [investor/shareholder] waives the right to request registration if the Company is in the process of, or plans to, conduct a private placement of securities where the registration rights would interfere with the private offering process. This waiver applies for a period of [X] months following the execution of this Agreement.
Registration rights clause with priority on registration deadlines
This clause specifies the timeline for completing the registration process.
The Company agrees to file a registration statement within [X] days of receiving the [investor/shareholder]'s request, and the registration statement must be declared effective within [X] months of filing. If the registration statement is not declared effective within this time frame, the Company shall compensate the [investor/shareholder] for any damages caused by the delay.
Registration rights clause with restriction on timing of registration requests
This clause limits when registration requests can be made.
The [investor/shareholder] shall be entitled to request registration under the Securities Act only during a period commencing [X] months after the execution of this Agreement and ending [Y] months thereafter. Requests made outside this period will not be honored unless agreed upon in writing by both parties.
Registration rights clause with indemnification provision
This variation includes an indemnity provision in the registration rights clause.
The Company agrees to indemnify the [investor/shareholder] against any losses or liabilities arising from the registration of their shares under the Securities Act, except for any damages caused by misstatements or omissions in the registration statement provided by the [investor/shareholder]. This indemnity provision shall survive the effectiveness of the registration statement.
Registration rights clause with third-party registration rights
This clause grants registration rights to a third party on behalf of the investor.
The [investor/shareholder] may assign their registration rights to a third party, who will then be entitled to request registration of the shares under the Securities Act on behalf of the [investor/shareholder]. The Company will honor such assignments, provided that the third party executes a written agreement to be bound by the terms of this Agreement.
Registration rights clause with termination of rights
This variation specifies when the registration rights terminate.
The registration rights provided under this Agreement shall terminate if the [investor/shareholder] does not request registration within [X] years from the date of this Agreement or if the [investor/shareholder] sells all of their shares in a private transaction. The rights will also terminate if the shares are no longer subject to transfer restrictions under applicable law.
Registration rights clause with multiple co-investor registration requests
This clause allows multiple investors to request registration of their shares simultaneously.
The [Company] agrees to register the shares of the [investor/shareholder] together with the shares of other investors who also have registration rights under this Agreement, provided that the total number of shares registered in any one registration statement does not exceed [X]% of the total number of shares to be sold. The registration statement will include all shares requested by investors with registration rights.
Registration rights clause with exemption for certain events
This clause exempts the Company from its obligations to register shares under certain events.
The [Company] is not obligated to register the shares held by the [investor/shareholder] if the registration request conflicts with an ongoing private offering, merger, or acquisition process. In such cases, the Company shall have the right to delay the filing of the registration statement until the private offering or transaction is completed.
Registration rights clause with post-offering registration rights
This clause allows the investor to request registration after a public offering.
In the event the Company completes a public offering of its securities, the [investor/shareholder] shall have the right to request the Company to register their shares under the Securities Act. The Company agrees to file such registration statements within [X] days of receiving such a request, provided that the shares are freely tradable.
Registration rights clause with retroactive inclusion of shares
This variation allows for the retroactive inclusion of shares in a registration request.
The [investor/shareholder] shall have the right to request that the Company register shares issued to the [investor/shareholder] within [X] months prior to the registration request, provided that the shares were not previously registered and the Company agrees to include them retroactively in the registration.
Registration rights clause with joint filing provision
This clause allows the investor and the Company to file jointly under certain circumstances.
The [investor/shareholder] shall have the right to request the Company to file a registration statement under the Securities Act, and the Company shall file such a statement jointly with the [investor/shareholder] if they hold shares that need to be registered together. All costs of the registration shall be borne by the Company, except for those related to the investor’s legal counsel.
Registration rights clause with request limitation during blackout period
This variation limits the investor's right to request registration during certain blackout periods.
The [investor/shareholder] may not request registration of their shares under this Agreement during a blackout period, as determined by the Company, which shall not exceed [X] days per year. Any requests made during this period shall be deferred until the blackout period ends.
Registration rights clause with limited public offering right
This variation limits the right to request registration based on the type of public offering.
The [investor/shareholder] shall only be entitled to request the Company to register their shares for a public offering if the offering is an initial public offering (IPO) or a secondary offering. The Company is not obligated to register shares in the event of a direct listing or other non-public offering.
Registration rights clause with delayed effectiveness provision
This clause allows the Company to delay the effectiveness of the registration statement.
The [Company] shall file a registration statement under the Securities Act within [X] days after receiving a registration request, but the effectiveness of the registration statement may be delayed for up to [X] additional days if the Company determines that market conditions are not conducive to a public offering at the time.
Registration rights clause with exclusion for insider shares
This clause excludes shares owned by insiders from registration rights.
The [investor/shareholder] shall have the right to request the Company to register their shares under the Securities Act. However, shares held by insiders, as defined by the SEC, shall not be eligible for registration under this clause unless the insider is no longer subject to restrictions under securities laws.
Registration rights clause with pro-rata allocation of shares
This variation ensures that the shares are registered on a pro-rata basis.
If the total number of shares to be registered exceeds the amount that can be effectively registered under the applicable securities laws, the shares to be registered shall be allocated on a pro-rata basis among the [investor/shareholder] and any other holders of registration rights in proportion to the number of shares each holder is requesting to be registered.
Registration rights clause with the Company’s right to suspend registration
This clause allows the Company to suspend the registration process under specific circumstances.
The [Company] shall have the right to suspend the registration of the [investor/shareholder]’s shares for up to [X] days, during which time the Company shall notify the [investor/shareholder] of the suspension and the reasons for it. The Company must promptly resume the registration process once the suspension period has passed.
Registration rights clause with filing fee allocation
This variation specifies how filing fees are shared between the Company and the investor.
The [Company] shall bear all filing fees and expenses related to the registration of the [investor/shareholder]’s shares under the Securities Act, except for any fees related to the investor's legal representation, underwriting fees, or any other expenses directly attributable to the investor’s participation in the offering.
Registration rights clause with notification requirement for registration delay
This clause requires the Company to notify the investor if the registration is delayed.
If the Company fails to file a registration statement within the agreed-upon timeline, it must notify the [investor/shareholder] within [X] business days, providing an explanation for the delay and a new proposed timeline for filing.
Registration rights clause with share dilution protection
This variation includes protection against share dilution in connection with registration.
If the [Company] issues additional securities during the registration process that would dilute the percentage ownership of the [investor/shareholder]’s shares, the Company agrees to issue additional shares to the [investor/shareholder] to maintain their original ownership percentage.
Registration rights clause with multiple registration statement options
This variation allows the investor to choose between different types of registration statements.
The [investor/shareholder] may choose whether to register their shares using a shelf registration statement or a traditional public offering registration statement. The Company agrees to file the registration under the chosen option, subject to the limitations of securities laws.
Registration rights clause with confidentiality provision
This clause ensures confidentiality of sensitive information during the registration process.
The [investor/shareholder] agrees to keep confidential any information received during the registration process that is not publicly available, including financial statements, business plans, and any other proprietary information disclosed by the Company.
Registration rights clause with indemnification for registration costs
This variation includes indemnification for costs associated with the registration process.
The Company agrees to indemnify the [investor/shareholder] against any losses, damages, or liabilities arising out of the registration of their shares under the Securities Act, including the legal costs associated with defending against such claims, except for claims arising out of misrepresentations made by the [investor/shareholder].
Registration rights clause with restriction on registration of restricted securities
This variation excludes restricted securities from registration rights.
The registration rights provided under this Agreement shall not apply to any restricted securities that are subject to transfer restrictions or lock-up periods. Only securities that are free from such restrictions shall be eligible for registration under this clause.
Registration rights clause with right to demand registration after IPO
This variation gives the investor the right to request registration after an initial public offering (IPO).
After the completion of an IPO, the [investor/shareholder] shall have the right to request the Company to register their shares under the Securities Act. The Company shall file a registration statement within [X] days following the request and use commercially reasonable efforts to have the registration statement declared effective.
Registration rights clause with cap on number of shares to be registered
This clause limits the number of shares that can be included in a registration request.
The [investor/shareholder] shall have the right to request the Company to file a registration statement under the Securities Act, provided that the number of shares to be included in the registration does not exceed [X]% of the total shares being registered. If the registration request exceeds this cap, the number of shares will be reduced on a pro-rata basis.
Registration rights clause with reduced registration obligation after certain period
This variation limits the Company’s registration obligation after a specific period.
The Company agrees to register the [investor/shareholder]’s shares under the Securities Act within [X] months following the execution of this Agreement. However, after [Y] months, the Company shall not be required to register additional shares unless it is able to file a registration statement in good faith under the applicable laws.
Registration rights clause with cost-sharing for registration
This clause outlines the cost-sharing arrangement for the registration process.
The Company shall bear all registration-related costs, including legal, accounting, and filing fees. The [investor/shareholder] shall bear the cost of their own legal counsel, underwriting fees, and any other costs specifically incurred by their participation in the registration process.
Registration rights clause with inclusion of other investors in the same registration
This variation allows other investors to be included in the registration request along with the requesting investor.
The [investor/shareholder] may request that the Company register their shares under the Securities Act along with other investors who have similar registration rights. The shares will be included in the registration statement on a pro-rata basis, depending on the number of shares each investor seeks to register.
Registration rights clause with right to piggyback on future public offerings
This clause allows the investor to piggyback on future public offerings initiated by the Company.
The [investor/shareholder] shall have the right to include their shares in any future public offering of the Company’s securities. The Company agrees to notify the [investor/shareholder] at least [X] days before filing any registration statement for such an offering, and the [investor/shareholder] will have the right to include their shares on the same terms.
Registration rights clause with restriction on the timing of requests
This clause limits the timing when registration requests can be made.
The [investor/shareholder] may request the Company to file a registration statement under the Securities Act, provided that such request is made no earlier than [X] months after the effective date of this Agreement and no later than [Y] months thereafter.
Registration rights clause with right to withdraw shares from registration
This variation allows the investor to withdraw their shares from registration before the process is completed.
The [investor/shareholder] shall have the right to withdraw some or all of their shares from the registration process at any time before the registration statement is declared effective. The [investor/shareholder] must provide written notice to the Company of the withdrawal of shares.
Registration rights clause with lock-up period after registration
This clause specifies a lock-up period after registration.
The [investor/shareholder] agrees not to sell, transfer, or otherwise dispose of the registered shares for a period of [X] days following the effectiveness of the registration statement, subject to any restrictions imposed by the underwriters in connection with a public offering.
Registration rights clause with restrictions on the number of registrations per year
This variation limits the number of times an investor can request registration in a given year.
The [investor/shareholder] may request the Company to file a registration statement under the Securities Act no more than [X] times per calendar year. The Company shall have the discretion to reject any requests that exceed this limitation.
Registration rights clause with early exit provision
This clause allows for early registration requests in the event of an acquisition or exit.
In the event of a proposed acquisition or merger of the Company, the [investor/shareholder] shall have the right to request that their shares be registered under the Securities Act for the purpose of facilitating the sale or exchange of their shares as part of the transaction.
Registration rights clause with registration obligation tied to market conditions
This variation allows for the delay of registration based on market conditions.
The Company agrees to file a registration statement within [X] days of receiving a request from the [investor/shareholder], but the Company may delay the filing if, in the reasonable judgment of the Company, market conditions are not favorable for a public offering at that time.
Registration rights clause with right to request additional filings
This variation provides the investor with the ability to request additional filings.
The [investor/shareholder] shall have the right to request additional registration filings under the Securities Act for any shares not initially included in the first registration, provided that such requests are made within [X] months of the first registration becoming effective.
Registration rights clause with a cap on expenses borne by the Company
This clause caps the amount of expenses the Company is required to pay for registration.
The Company shall bear the expenses associated with filing a registration statement under the Securities Act, up to a maximum of [amount]. Any expenses exceeding this amount will be borne by the [investor/shareholder], unless otherwise agreed.
Registration rights clause with priority for large holders of shares
This variation gives priority registration rights to investors with a larger stake in the company.
In the event of a registration request, the [investor/shareholder] who holds more than [X]% of the Company’s outstanding shares shall have priority in having their shares included in the registration statement. Shares held by smaller investors shall be included only if space allows.
Registration rights clause with requirement for registration in stages
This clause allows the registration to happen in stages depending on the number of shares.
The [Company] agrees to file a registration statement under the Securities Act, but the registration may occur in multiple stages, depending on the number of shares to be registered. The first stage shall include up to [X]% of the shares, with additional stages completed over the following [Y] months.
Registration rights clause with right to request immediate filing
This clause grants the investor the right to demand immediate filing of the registration statement.
The [investor/shareholder] shall have the right to request the Company to immediately file a registration statement under the Securities Act upon the request, without any delays. The Company agrees to use commercially reasonable efforts to file the registration within [X] days of the request.
Registration rights clause with provision for free marketable securities
This variation ensures the registered shares are free to be traded in the public market.
The [investor/shareholder] shall have the right to register their shares under the Securities Act, provided that all registered shares are freely tradable in the public market without any restrictions or lock-up periods, except as otherwise required by law.
Registration rights clause with right to assign registration rights
This clause allows the investor to assign their registration rights to a third party.
The [investor/shareholder] may assign their registration rights under this clause to any third party who acquires their shares, provided that the assignee agrees to be bound by the terms of this Agreement and provides written notice to the Company.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.