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.
A Travis Texas Right of First Refusal (ROAR) and Co-Sale Agreement is a legally binding document that regulates the rights of existing shareholders or investors when a company's shares are being sold, transferred, or issued to a third party. These agreements are common in the realm of corporate transactions, particularly in the context of startups, venture capital investments, or private equity deals. The purpose of such agreements is to protect the rights and interests of existing shareholders by granting them certain privileges and opportunities when shares are being sold. In Travis, Texas, like in many other jurisdictions, there are different types of ROAR and Co-Sale Agreements that may be utilized depending on the specific circumstances and preferences of the parties involved. Here are some main types: 1. Right of First Refusal (ROAR): The ROAR aspect of the agreement bestows the existing shareholders with the first opportunity to purchase the shares being offered for sale by a shareholder intending to sell. This right allows the existing shareholders to maintain their ownership percentage or increase their stake in the company before outside investors can enter. The selling shareholder must typically offer the shares on the same terms and conditions as those proposed by the third party. If the existing shareholders refuse or do not exercise their ROAR, then the selling shareholder can proceed with selling the shares to the third party. 2. Co-Sale Agreement: A Co-Sale Agreement, also known as a Tag-Along Right, is often included in conjunction with the ROAR clause. This provision enables minority shareholders to participate in a sale by requiring the majority shareholder(s) to allow them to sell their shares on the same terms and conditions as the majority shareholder(s) intended to sell. The Co-Sale Agreement safeguards the interests of minority shareholders by preventing situations where majority shareholders can sell their shares while excluding minority shareholders from the offering. 3. Drag-Along Right: Though not explicitly a part of the Travis Texas Right of First Refusal and Co-Sale Agreement, it is worth mentioning the concept of a Drag-Along Right. This provision empowers a majority shareholder to "drag" minority shareholders into a sale to a third party if the majority shareholder decides to sell their shares. The Drag-Along Right enables the majority shareholder to complete a sale more efficiently by enforcing the participation of minority shareholders, ensuring a unified transaction. It is important to note that the specific terms and conditions of the Travis Texas Right of First Refusal and Co-Sale Agreement can vary based on the negotiation and agreement between the parties involved. Such agreements are typically drafted with the assistance of legal professionals to ensure compliance with local regulations and protect the interests of all shareholders.A Travis Texas Right of First Refusal (ROAR) and Co-Sale Agreement is a legally binding document that regulates the rights of existing shareholders or investors when a company's shares are being sold, transferred, or issued to a third party. These agreements are common in the realm of corporate transactions, particularly in the context of startups, venture capital investments, or private equity deals. The purpose of such agreements is to protect the rights and interests of existing shareholders by granting them certain privileges and opportunities when shares are being sold. In Travis, Texas, like in many other jurisdictions, there are different types of ROAR and Co-Sale Agreements that may be utilized depending on the specific circumstances and preferences of the parties involved. Here are some main types: 1. Right of First Refusal (ROAR): The ROAR aspect of the agreement bestows the existing shareholders with the first opportunity to purchase the shares being offered for sale by a shareholder intending to sell. This right allows the existing shareholders to maintain their ownership percentage or increase their stake in the company before outside investors can enter. The selling shareholder must typically offer the shares on the same terms and conditions as those proposed by the third party. If the existing shareholders refuse or do not exercise their ROAR, then the selling shareholder can proceed with selling the shares to the third party. 2. Co-Sale Agreement: A Co-Sale Agreement, also known as a Tag-Along Right, is often included in conjunction with the ROAR clause. This provision enables minority shareholders to participate in a sale by requiring the majority shareholder(s) to allow them to sell their shares on the same terms and conditions as the majority shareholder(s) intended to sell. The Co-Sale Agreement safeguards the interests of minority shareholders by preventing situations where majority shareholders can sell their shares while excluding minority shareholders from the offering. 3. Drag-Along Right: Though not explicitly a part of the Travis Texas Right of First Refusal and Co-Sale Agreement, it is worth mentioning the concept of a Drag-Along Right. This provision empowers a majority shareholder to "drag" minority shareholders into a sale to a third party if the majority shareholder decides to sell their shares. The Drag-Along Right enables the majority shareholder to complete a sale more efficiently by enforcing the participation of minority shareholders, ensuring a unified transaction. It is important to note that the specific terms and conditions of the Travis Texas Right of First Refusal and Co-Sale Agreement can vary based on the negotiation and agreement between the parties involved. Such agreements are typically drafted with the assistance of legal professionals to ensure compliance with local regulations and protect the interests of all shareholders.
Para su conveniencia, debajo del texto en español le brindamos la versión completa de este formulario en inglés. For your convenience, the complete English version of this form is attached below the Spanish version.
