New Mexico Investors' Rights Agreement is a legal document that outlines the rights and obligations of Velocity, Inc., the existing holders (also known as shareholders or investors), and the founders of the company. This agreement is crucial in protecting the interests of the investors and ensuring they have a say in important decision-making processes within the company. The New Mexico Investors' Rights Agreement covers various aspects such as voting rights, information rights, preemptive rights, and anti-dilution provisions. It is designed to maintain the balance of power between the founders and the investors and provide certain protections to the latter. 1. Voting Rights: The agreement specifies the voting rights of the investors and their ability to influence decision-making processes. This ensures that significant company decisions are not made without the involvement and approval of the investors. 2. Information Rights: Investors are entitled to receive regular updates and information related to the company's operations, financial status, and future plans. This provision enables investors to stay informed about the company's progress and make informed decisions. 3. Preemptive Rights: If additional shares of the company are to be issued, the New Mexico Investors' Rights Agreement may grant investors the right to purchase their proportionate share before any outsider. This protects their ownership percentage and prevents dilution of their investment. 4. Anti-dilution Provisions: Sometimes, companies may issue new shares at a lower price, leading to a decrease in the value of existing shares. Provisions within the agreement can protect investors from such dilution by adjusting the conversion ratio or issuing additional shares to compensate for the decrease in value. It's important to note that New Mexico may have specific regulations and variations of the Investors' Rights Agreement. For instance, there might be different types of agreements based on the company's stage (early-stage, growth-stage, or mature-stage) or the type of investors involved (angel investors, venture capitalists, or strategic investors). Overall, the New Mexico Investors' Rights Agreement is a vital legal document that establishes the terms and conditions governing the relationship between Velocity, Inc., its existing holders, and founders. It aims to safeguard the rights and interests of the investors while ensuring the company's growth and success.