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Shareholder Rights Plan

Draft Shareholder Rights Plans in Minutes, Not Days

25 minutes with CaseMark

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Shareholder Rights Plan

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Workflow

Shareholder Rights Plan

Overview

Drafting shareholder rights plans manually requires extensive knowledge of poison pill mechanics, careful coordination of flip-in and flip-over provisions, and meticulous attention to triggering thresholds and redemption terms. Corporate attorneys spend 6-8 hours researching precedents, customizing complex anti-takeover provisions, and ensuring compliance with state corporate law requirements.

Drafting a legally enforceable shareholder rights plan requires extensive research into current case law, careful coordination with existing charter provisions, and precise drafting of complex flip-in and flip-over mechanisms. Traditional manual preparation takes 15-20 hours of attorney time and risks inconsistencies or gaps in protection that could render the plan vulnerable to legal challenge.

CaseMark automates the entire rights plan drafting process, analyzing your corporate documents, researching current Delaware case law and market practice, and generating a complete, execution-ready rights agreement with all supporting documents. The AI ensures all provisions comply with Unocal/Revlon standards while providing strategic flexibility for board decision-making.

How it works

  1. 1. Upload your documents

  2. 2. AI analyzes and extracts key information

  3. 3. Review and customize the generated content

  4. 4. Export in your preferred format (DOCX, PDF)

What you get

  • Header and Parties

  • Issuance of Rights

  • Initial Exercisability

  • Triggering Events and Distribution Date

  • Flip-In Provisions

  • Flip-Over Provisions

  • Redemption Rights

  • Exchange Provisions

  • Expiration Terms

  • Amendment Procedures

  • Governing Law

What it handles

  • Header and Parties

  • Issuance of Rights

  • Initial Exercisability

  • Triggering Events and Distribution Date

  • Flip-In Provisions

  • Flip-Over Provisions

  • Redemption Rights

  • Exchange Provisions

  • Expiration Terms

  • Amendment Procedures

  • Governing Law

Required documents

  • Certificate of Incorporation

    Current certificate of incorporation showing authorized shares, preferred stock provisions, and any existing defensive measures

    .pdf, .docx, .doc

  • Corporate Bylaws

    Current bylaws governing board authority, shareholder rights, and amendment procedures

    .pdf, .docx, .doc

Supporting documents

  • Prior Rights Plan

    Any expired or terminated shareholder rights plans for reference and improvement

    .pdf, .docx, .doc

  • Board Resolutions

    Previous board resolutions regarding defensive measures or governance policies

    .pdf, .docx, .doc

  • Shareholder Reports

    Current shareholder ownership data to inform triggering threshold decisions

    .pdf, .xlsx, .csv

  • Comparable Company Plans

    Rights plans from peer companies for market practice comparison

    .pdf, .docx

Why teams use it

Generate complete rights agreements with poison pill provisions in under 15 minutes

Automated flip-in and flip-over provisions with customizable triggering thresholds

Built-in compliance with corporate governance best practices and state law requirements

Flexible redemption and exchange terms tailored to your defensive strategy

Reduce drafting time by 97% while maintaining precision in anti-takeover protections

Questions

What is a shareholder rights plan and why would my company need one?

A shareholder rights plan (commonly called a 'poison pill') is a defensive measure that protects shareholders against hostile takeovers by making acquisitions prohibitively expensive for unwanted acquirers. When triggered by an acquirer crossing a specified ownership threshold (typically 15-20%), the plan allows all other shareholders to purchase additional shares at a steep discount, massively diluting the hostile acquirer's stake. Companies adopt these plans to ensure the board has time to evaluate offers and negotiate the best possible terms for all shareholders.

How long does it take CaseMark to draft a complete shareholder rights plan?

CaseMark generates a comprehensive, execution-ready shareholder rights plan in approximately 25 minutes, compared to 15-20 hours for manual preparation. The output includes the complete Rights Agreement, Certificate of Designations for preferred stock, board memorandum, SEC filing drafts, and implementation materials. All provisions are automatically customized based on your uploaded corporate documents and current legal standards.

Will the rights plan comply with Delaware law and current governance standards?

Yes, CaseMark incorporates the latest Delaware case law interpreting the Unocal and Revlon standards that govern board adoption of defensive measures. The AI researches recent Court of Chancery decisions, analyzes current market practice among comparable companies, and ensures all provisions meet SEC disclosure requirements and stock exchange listing standards. The generated plan includes detailed fiduciary duty analysis supporting the board's business judgment in adopting the measure.

What triggering threshold should I use for my rights plan?

The appropriate triggering threshold depends on your company's shareholder base, industry takeover risk, and governance philosophy. Most plans use thresholds between 10% and 20%, with 15% being most common in current market practice. CaseMark analyzes your shareholder ownership data and peer company plans to recommend an optimal threshold, but you retain full flexibility to adjust based on your board's strategic assessment. Lower thresholds provide earlier warning but may be viewed as more defensive by institutional investors.

Can the board redeem the rights plan if we receive a friendly acquisition offer?

Yes, shareholder rights plans include broad board redemption authority specifically to preserve flexibility for friendly transactions. The board can redeem all outstanding rights at a nominal price (typically $0.001 per right) at any time before an acquirer crosses the triggering threshold. This ensures the plan deters only hostile or inadequate offers while allowing the board to accept superior proposals that maximize shareholder value. CaseMark's generated plan includes detailed redemption provisions and guidance on the fiduciary considerations governing redemption decisions.

What documents do I need to provide to generate a rights plan?

At minimum, you need your current certificate of incorporation and bylaws, which CaseMark analyzes to understand your capital structure, authorized shares, and existing governance provisions. Optional documents like prior rights plans, board resolutions, shareholder reports, and peer company plans help the AI further customize the output to your specific circumstances. The more context you provide, the more tailored and strategic the generated rights plan will be.

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