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 Virginia Right of First Refusal and Co-Sale Agreement is a legal document that aims to protect the rights of parties involved in the transfer of ownership of a property or shares in a company located in the state of Virginia. This agreement is crucial in situations where one party wishes to sell their interest in the property or shares, as it gives the other party the first option to purchase the same interest at the same terms and conditions offered by a third-party buyer. The Right of First Refusal (ROAR) is a provision within the agreement that grants an existing owner the right to purchase the interest being sold before it can be sold to an outside party. Essentially, this right provides an opportunity for the current owner to maintain their ownership stake by purchasing the interest themselves. In Virginia, there are different types of Right of First Refusal and Co-Sale Agreements depending on the context in which they are applied: 1. Real Estate Right of First Refusal: This type of agreement is commonly used in real estate transactions. It ensures that if the owner decides to sell their property, they must first offer it to a specific party, such as a tenant or a co-owner, before marketing it to the public. 2. Corporate Shareholder Right of First Refusal: This agreement type is often utilized in corporate scenarios. It offers shareholders the opportunity to acquire shares that another shareholder wishes to sell before considering selling them to an external buyer. 3. Partnership Right of First Refusal: In partnerships, this agreement allows partners to exercise their right to purchase the interest being sold by another partner before it is sold to someone who is not a partner. The Co-Sale Agreement, which is usually combined with the Right of First Refusal, is an additional provision in the agreement. It states that if one party exercises their Right of First Refusal to purchase a portion of the interest being sold, the other party, typically a co-owner or shareholder, has the right to sell a proportionate share of their interest to the same buyer at the same terms and conditions. This provision prevents the dilution of ownership and helps maintain the proportional ownership balance among the parties involved. Therefore, the Virginia Right of First Refusal and Co-Sale Agreement is an essential legal tool that safeguards the interests of property owners, shareholders, and partners in various contexts, such as real estate, corporations, and partnerships in the state of Virginia. It ensures fair treatment, protects against unjust transfers, and preserves proportional ownership among the parties involved.
