Standby Offering Clause Samples

A Standby Offering clause outlines the process by which existing shareholders are given the opportunity to purchase additional shares in a company before those shares are offered to outside investors. Typically, this clause is activated during a new issuance of shares, allowing current shareholders to maintain their proportional ownership and prevent dilution. By establishing a clear procedure for such offerings, the clause ensures fairness among shareholders and helps the company raise capital while protecting existing ownership interests.