Will the net proceeds from selling the rights be all count as capital gain?
Tax treatment alternatives are described on page 61 of the rights offering prospectus. Basic answer to your question is yes, with zero cost basis and holding period the same as your stock.
What happens If I exercise them instead of selling? Where does the date count from for LT Cap Gain perspective? Is it the day I received the rights, or the day they were exercised?
Good question. I would think so as there is no cost basis and any gain would be taxed.
Agree. 100% S.T. Cap Gain.