Rights Issue Sub-Underwriting Summary Letter
Publisher one
Genie AIJurisdiction
England and WalesCost
Free to useRelevant sectors
Type of legal document
📃 Sub-underwriting agreementBusiness activity
Sub-underwriting agreementA sub-underwriting agreement is a contract between a primary underwriter and a sub-underwriter that sets forth the terms and conditions under which the sub-underwriter agrees to take on some or all of the risk associated with an offering of securities. The agreement will typically specify the maximum amount of risk that the sub-underwriter is willing to assume, as well as the compensation that the sub-underwriter will receive for assuming that risk.
In a rights issue, a company offers its existing shareholders the opportunity to purchase additional shares in proportion to their existing shareholding. Sub-underwriting is a practice where a third-party agrees to purchase any shares that are not taken up by existing shareholders in a rights issue, thereby providing a financial guarantee to the issuing company.
This template letter provides a comprehensive summary of the sub-underwriting agreement under the jurisdiction of UK law, detailing the rights and obligations of both the issuing company and the sub-underwriter. It may cover various essential aspects such as the terms of the sub-underwriting arrangement, the number of shares involved, the subscription price, deadlines, payment schedules, and any potential limitations or conditions associated with the sub-underwriting agreement.
Furthermore, the template may outline the legal responsibilities and liabilities of each party involved, including any indemnification clauses or dispute resolution mechanisms in case of disagreements or defaults. It may also provide details regarding the allocation of fees, expenses, or commissions relating to the sub-underwriting transaction.
Overall, this legal template aims to serve as a concise and standardized summary of the sub-underwriting agreement within the framework of UK legislation, allowing both parties to understand their respective roles and responsibilities more effectively while ensuring compliance with legal requirements.
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