![]() After the lock-up period expires, company insiders have the right, but not the. The terms of lockup agreements may vary, but most prevent insiders from selling their shares for 180 days. ![]() This period, referred to as the lock-up period, typically lasts from 90 to 180 days after the date of an offering (with 180 days more typical in an IPO and 90 days in a follow-on offering). In a standard IPO, the underwriters usually, as a condition of the underwriting agreement, require that certain company insiders (such as selling shareholders and directors and officers) agree to restrictions on selling their shares for a period of time immediately following the offering, pursuant to a lock-up agreement. Learning that the lockup provision prevents the immediate sales of a portion of shares for a pre-specified time, the supply of shares will be controlled. This template includes practical guidance, drafting notes, and optional clauses. After a company goes public, a limited number of shares are available for trading. The waiver releases the recipient from certain of the lock-up agreement’s restrictions. A lock-up period is intended to prevent early investors and insiders from selling their shares for a predetermined amount of time after a companys Initial. The lock-up period is meant to give the stock time to stabilise after the IPO. This template may be used by an underwriter to provide a waiver to selling shareholders or other parties to a lock-up agreement who have agreed to restrictions in transacting in company shares after an initial public offering (IPO). ![]()
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