This is a "Right of First Refusal and Co-Sale Agreement." It is entered into by the corporation and the purchasers of preferred stock. It gives the company and the purchasers of preferred stock certain rights of refusal and options upon the transfer of stock.
The Hawaii Right of First Refusal and Co-Sale Agreement is a legal document that governs the rights and obligations of shareholders in a company, specifically when it comes to the sale of shares. This agreement is designed to protect the interests of all parties involved and ensure a fair process for selling shares. The Right of First Refusal clause in the agreement grants the existing shareholders the right to purchase any shares being sold before they are offered to third parties. This clause ensures that current shareholders have the opportunity to maintain their ownership percentage and prevents outsiders from acquiring a controlling interest in the company without the consent of existing shareholders. On the other hand, the Co-Sale Agreement clause provides protection to minority shareholders by allowing them to sell their shares alongside majority shareholders during a transaction. This provision ensures that minority shareholders have the opportunity to exit the company on the same terms as majority shareholders and prevents any unfair advantages or discrepancies in the sale process. It is important to note that there may be different types of Hawaii Right of First Refusal and Co-Sale Agreements, depending on the specific needs and circumstances of the shareholders involved. Some common variations of these agreements may include: 1. Automatic Right of First Refusal: This type of agreement automatically triggers the right of first refusal for all shareholders whenever a shareholder decides to sell their shares, without requiring any additional notice or negotiations. 2. Non-Automatic Right of First Refusal: In this variation, the right of first refusal is only triggered when a shareholder receives an offer to sell their shares from a third party. The existing shareholders then have a predetermined time period to decide whether they want to exercise their right to purchase the shares. 3. Voluntary Co-Sale Agreement: This type of agreement allows minority shareholders to choose whether they want to participate in the sale alongside majority shareholders. It gives them the flexibility to decide if they want to sell their shares or retain their ownership during the transaction. 4. Mandatory Co-Sale Agreement: In contrast to the voluntary co-sale agreement, this type requires all shareholders to sell their shares together. It ensures that all shareholders have a unified exit strategy and prevents situations where individual shareholders can disrupt the sale process. In conclusion, the Hawaii Right of First Refusal and Co-Sale Agreement provides a framework for fair and transparent shareholder transactions. These agreements protect the rights and interests of shareholders and ensure a smooth process for selling shares. Different types of agreements exist to cater to the specific needs and preferences of the shareholders involved.
