make your free management rights agreement

management rights agreement

this management rights agreement hereinafter referred to as (the agreement) is made and enteredinto on , by and between , , , , hereinafter referred to as company, and , , , , hereinafter referred to as investor.

recitals

whereas, the company is ready to grant the investor certain rights in the management of thecompany to induce the investor to invest in the company; and

whereas, the investor is ready to purchase shares in the company and to accept certainmanagement rights in the company;

now therefore, in consideration of the mutual covenants and promises hereinafter setforth, the parties hereto agree as follows:

1.general rights of the investor

the investor shall be entitled, so long as investor holds, beneficially or otherwise, shares of the company's preferred stock or common stock issued upon conversion of the preferred stock, to the following contractual management rights, in addition to rights to non-public financial information, inspection rights, and other rights specifically provided to all investors in connection with the current transaction in the financing agreements delivered in connection with the sale of the preferred stock, as amended, and as otherwise required by law:

the investor shall be entitled to consult with and advise management of the company on significant business issues, including management's proposed annual and quarterly operating plans, and management will meet with the investor regularly within 30 days after the end of each fiscal quarter at the company's facilities at mutually agreeable times for such consultation and advice and to review progress in achieving said plans.

2.examination of books and records

investor may examine the books and records of the company and inspect its facilities and may request information at reasonable times and intervals concerning the general status of the company's financial condition and operations, provided that access to highly confidential proprietary information and facilities need not be provided.

3.representation on the board

if investor is not represented on the company's board of directors (the "board"), the company shall invite a representative of investor to attend all meetings of the board in a non-voting observer capacity and, in this respect, shall give such representative of investor copies of all notices, minutes, consents and other material that the company provides to its directors provided that such representative shall hold in confidence and trust and act in a fiduciary manner with respect to all information received.

the representative may be excluded from access to any material or meeting or portion thereof if the company believes, upon advice of counsel, that such exclusion is reasonably necessary to preserve the attorney-client privilege, to protect highly confidential proprietary information, or for other similar reasons. upon reasonable notice and at a scheduled meeting of the board or such other time, if any, as the board may determine in its sole discretion, such representative may address the board with respect to investor's concerns regarding significant business issues facing the company.

4.confidentiality

each investor agrees, and any representative of investor will agree, to hold in confidence and trust and not use or disclose any confidential information provided to or learned by it in connection with its rights under this letter.

5.termination

the rights described herein shall terminate and be of no further force or effect upon the consummation of the sale of the company's securities pursuant to a registration statement filed by the company under the applicable law in connection with the firm commitment underwritten offering of its securities to the general public. the confidentiality provisions hereof will survive any such termination.

6.arbitration

in the event of any dispute between the company and investor regarding this agreement or the plan, the dispute and any issue shall be settled to the exclusion of a court of law, by arbitration.

7.notice

any notice to be given under the terms of this agreement shall be addressed to the company and investor at the addresses mentioned above or at such other address as the parties may specify in writing to the other party.

8.governing law

this agreement shall be governed by the laws of the state of .

8.signatures

this agreement shall be signed by on behalf of and by on behalf of .