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 North Carolina Right of First Refusal and Co-Sale Agreement is a legal contract that outlines the rights and obligations of parties involved in the sale or transfer of certain assets, particularly shares of a company. This agreement is primarily used in business transactions, especially when dealing with closely held corporations or partnerships. The Right of First Refusal (ROAR) provision in the agreement grants a specific party, typically an existing shareholder, the first opportunity to purchase the shares being sold or transferred by another shareholder. Essentially, it gives the shareholder the right to match any other offer received for the shares. This provision ensures that existing shareholders have a chance to maintain their ownership interest and prevent outsider investors from gaining control. On the other hand, the Co-Sale Agreement, also known as the Tag-Along provision, protects minority shareholders by giving them the opportunity to sell their shares on the same terms and conditions as the majority shareholder. If a majority shareholder receives an offer to purchase their shares, the minority shareholder(s) have the right to include their shares in the transaction and sell them alongside the majority shareholder. This provision prevents majority shareholders from excluding minority shareholders from potential sales. In North Carolina, there are no specific variations or types of Right of First Refusal and Co-Sale Agreements that are unique to the state. However, the terms and conditions within these agreements can differ based on the parties involved and the specific needs or preferences of the shareholders. The exact terms can be customized to address various factors, such as pricing, timeframes, triggering events, and exceptions to the rights of first refusal and co-sale. To ensure the validity and enforceability of the North Carolina Right of First Refusal and Co-Sale Agreement, it is recommended to consult with a qualified attorney familiar with corporate and contract law. They can provide guidance tailored to your specific circumstances and help draft an agreement that protects the interests of all parties involved.
