A waiver of shareholder preemptive rights that is in writing is generally irrevocable.

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Multiple Choice

A waiver of shareholder preemptive rights that is in writing is generally irrevocable.

A written waiver of preemptive rights creates a binding contract. Once a shareholder signs a written waiver, they are generally giving up their right to participate in future issuances as specified, and that surrender is typically irrevocable to protect certainty for the company and other investors. The key idea is that writing provides a clear, enforceable agreement, so the waiver isn’t easily undone later. The other options misstate what a waiver does: it doesn’t transfer rights to someone else, it isn’t normally revocable at will once in writing, and it doesn’t simply “terminate” the right to participate in all future issuances—rather, it permanently relinquishes that right for the issuances covered by the waiver.

A written waiver of preemptive rights creates a binding contract. Once a shareholder signs a written waiver, they are generally giving up their right to participate in future issuances as specified, and that surrender is typically irrevocable to protect certainty for the company and other investors. The key idea is that writing provides a clear, enforceable agreement, so the waiver isn’t easily undone later. The other options misstate what a waiver does: it doesn’t transfer rights to someone else, it isn’t normally revocable at will once in writing, and it doesn’t simply “terminate” the right to participate in all future issuances—rather, it permanently relinquishes that right for the issuances covered by the waiver.

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