Form with which a corporation advises that it has resolved that some shareholders shall be required to give the corporation the opportunity to purchase shares before selling them to another.
Connecticut Corporate Right of First Refusal (ROAR) is a legal mechanism that grants a corporation the priority or first opportunity to purchase certain assets or securities before they are sold or transferred to a third party. This right is exercised through a corporate resolution, which is a formal decision made by the corporation's board of directors. The purpose of the Connecticut Corporate Right of First Refusal is to protect the interests of the corporation and its shareholders by ensuring that the corporation has the chance to maintain control over its assets and maintain the ownership structure. It prevents unwanted transfers of shares or assets that could potentially dilute the ownership or control of the corporation. There are different types of Connecticut Corporate Right of First Refusal, including: 1. Shareholder Right of First Refusal: This type of ROAR provides existing shareholders with the right to purchase additional shares being offered for sale by another shareholder before those shares are sold to an outside party. 2. Asset Right of First Refusal: This type of ROAR grants the corporation the first opportunity to purchase specific assets, such as real estate, equipment, or intellectual property, before they are sold to a third party. 3. Stock Option Right of First Refusal: This type of ROAR allows the corporation to buy back employee stock options before they are exercised or sold to an outside party. To implement the Connecticut Corporate Right of First Refusal, the corporation must pass a corporate resolution, which is a formal decision made by the board of directors. The resolution typically outlines the specific situations in which the right of first refusal can be exercised, the process to be followed when the right is invoked, and the time frame within which the corporation must exercise its right. The Connecticut Corporate Right of First Refusal is an important mechanism for corporations to maintain control over their assets and preserve the ownership structure. It provides shareholders with a level of protection against unwanted transfers and ensures that they have the opportunity to maintain their ownership stake in the company. By utilizing corporate resolutions, corporations can effectively exercise and enforce their right of first refusal in accordance with Connecticut laws and regulations.
