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Company History
Management Team
Andyco Foundation
Investor Info
Legal Department
No party has been induced to enter into this Agreement by, nor is any
party relying on, any representation, understanding, agreement, commitment
or warranty outside those expressly set forth in this Agreement. Severability
of Agreement If any term or provision of this Agreement is determined
to be illegal, unenforceable, or invalid in whole or in part for any reason,
such illegal, unenforceable, or invalid provisions or part thereof shall
be stricken from this Agreement, and such provision shall not affect the
legality, enforceability, or validity of the remainder of this Agreement.
If any provision or part thereof of this Agreement is stricken in accordance
with the provisions of this section, then this stricken provision shall
be replaced, to the extent possible, with a legal, enforceable, and valid
provision that is as similar in tenor to the stricken provision as is
legally possible. Separate Writings and Exhibits The following [e.g.,
agreements, exhibits, schedules, or other separate writings] constitute
a part of this Agreement and are incorporated into this Agreement by this
reference: [List separate writings by name and date]. Should any inconsistency
exist or arise between a provision of this Agreement and a provision of
any exhibit, schedule, or other incorporated writing, the provision of
this Agreement shall prevail. Time of the Essence Time is of the essence
in respect to all provisions of this Agreement that specify a time for
performance; provided, however, that the foregoing shall not be construed
to limit or deprive a party of the benefits of any grace or use period
allowed in this Agreement. Survival Except as otherwise expressly provided
in this Agreement, representations, warranties, and covenants contained
in this Agreement, or in any instrument, certificate, exhibit, or other
writing intended by the parties to be a part of this Agreement, shall
survive for ___ years after the date of this Agreement. Ambiguities Each
party and its counsel have participated fully in the review and revision
of this Agreement. Any rule of construction to the effect that ambiguities
are to be resolved against the drafting party shall not apply in interpreting
this Agreement. The language in this Agreement shall be interpreted as
to its fair meaning and not strictly for or against any party.
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Guardians of the corporate loop-hole.
This
Agreement, and any dispute arising from the relationship between the parties
to this Agreement, shall be governed by California law, excluding any
laws that direct the application of another jurisdiction’s laws.
Attorney Fees Provision In any litigation, arbitration, or other proceeding
by which one party either seeks to enforce its rights under this Agreement
(whether in contract, tort, or both) or seeks a declaration of any rights
or obligations under this Agreement, the prevailing party shall be awarded
its reasonable attorney fees, and costs and expenses incurred. Notice
Any notices required or permitted to be given hereunder shall be given
in writing and shall be delivered (a) in person, (b) by certified
mail, postage prepaid, return receipt requested, (c) by facsimile,
or (d) by a commercial overnight courier that guarantees next day
delivery and provides a receipt, and such notices shall be addressed as
follows: or to such other address as either party may from time to time
specify in writing to the other party. Any notice shall be effective only
upon delivery, which for any notice given by facsimile shall mean notice
which has been received by the party to whom it is sent as evidenced by
confirmation slip. Modification of Agreement This Agreement may be supplemented,
amended, or modified only by the mutual agreement of the parties. No supplement,
amendment, or modification of this Agreement shall be binding unless it
is in writing and signed by all parties. Entire Agreement This Agreement
and all other agreements, exhibits, and schedules referred to in this
Agreement constitute(s) the final, complete, and exclusive statement of
the terms of the agreement between the parties pertaining to the subject
matter of this Agreement and supersedes all prior and contemporaneous
understandings or agreements of the parties. This Agreement may not be
contradicted by evidence of any prior or contemporaneous statements or
agreements. No party has been induced to enter into this Agreement by,
nor is any party relying on, any representation, understanding, agreement,
commitment or warranty outside those expressly set forth in this Agreement.
Severability of Agreement If any term or provision of this Agreement is
determined to be illegal, unenforceable, or invalid in whole or in part
for any reason, such illegal, unenforceable, or invalid provisions or
part thereof shall be stricken from this Agreement, and such provision
shall not affect the legality, enforceability, or validity of the remainder
of this Agreement. If any provision or part thereof of this Agreement
is stricken in accordance with the provisions of this section, then this
stricken provision shall be replaced, to the extent possible, with a legal,
enforceable, and valid provision that is as similar in tenor to the stricken
provision as is legally possible. Separate Writings and Exhibits The following
[e.g., agreements, exhibits, schedules, or other separate writings] constitute
a part of this Agreement and are incorporated into this Agreement by this
reference: [List separate writings by name and date]. Should any inconsistency
exist or arise between a provision of this Agreement and a provision of
any exhibit, schedule, or other incorporated writing, the provision of
this Agreement shall prevail. Time of the Essence Time is of the essence
in respect to all provisions of this Agreement that specify a time for
performance; provided, however, that the foregoing shall not be construed
to limit or deprive a party of the benefits of any grace or use period
allowed in this Agreement. Survival Except as otherwise expressly provided
in this Agreement, representations, warranties, and covenants contained
in this Agreement, or in any instrument, certificate, exhibit, or other
writing intended by the parties to be a part of this Agreement, shall
survive for ___ years after the date of this Agreement. Ambiguities Each
party and its counsel have participated fully in the review and revision
of this Agreement. Any rule of construction to the effect that ambiguities
are to be resolved against the drafting party shall not apply in interpreting
this Agreement. The language in this Agreement shall be interpreted as
to its fair meaning and not strictly for or against any party. Waiver
No waiver of a breach, failure of any condition, or any right or remedy
contained in or granted by the provisions of this Agreement shall be effective
unless it is in writing and signed by the party waiving the breach, failure,
right, or remedy. No waiver of any breach, failure, right, or remedy,
whether or not similar, nor shall any waiver constitute a continuing waiver
unless the writing so specifies. Headings The headings in this Agreement
are included for convenience only and shall neither affect the construction
or interpretation of any provision in this Agreement nor affect any of
the rights or obligations of the parties to this Agreement. Necessary
Acts, Further Assurances The parties shall at their own cost and expense
execute and deliver such further documents and instruments and shall take
such other actions as may be reasonably required or appropriate to evidence
or carry out the intent and purposes of this Agreement. Execution This
Agreement may be executed in counterparts and by fax. Consent to Jurisdiction
and Forum Selection The parties hereto agree that all actions or proceedings
arising in connection with this Agreement shall be tried and litigated
exclusively in the State and Federal courts located in the County of ,
State of . The aforementioned choice of venue is intended by the parties
to be mandatory and not permissive in nature, thereby precluding the possibility
of litigation between the parties with respect to or arising out of this
Agreement in any jurisdiction other than that specified in this paragraph.
Each party hereby waives any right it may have to assert the doctrine
of forum non conveniens or similar doctrine or to object to venue with
respect to any proceeding brought in accordance with this paragraph, and
stipulates that the State and Federal courts located in the County of
, State of shall have in personam jurisdiction and venue over each of
them for the purpose of litigating any dispute, controversy, or proceeding
arising out of or related to this Agreement. Each party hereby authorizes
and accepts service of process sufficient for personal jurisdiction in
any action against it as contemplated by this paragraph by registered
or certified mail, return receipt requested, postage prepaid, to its address
for the giving of notices as set forth in this Agreement. Any final judgement
rendered against a party in any action or proceeding shall be conclusive
as to the subject of such final judgement and may be enforced in other
jurisdictions in any manner provided by law. Jury Trial Waivers To the
fullest extent permitted by law, and as separately bargained-for-consideration,
each party hereby waives any right to trial by jury in any action, suit,
proceeding, or counterclaim of any kind arising out of or relating to
this Agreement. Specific Performance The parties acknowledge that it will
be impossible to measure in money the damage to them caused by any failure
to comply with the covenants set forth in Section , that each such covenant
is material, and that in the event of any such failure, the injured party
will not have an adequate remedy at law or in damages. Therefore, the
parties consent to the issuance of an injunction or the enforcement of
other equitable remedies against them at the suit of the other, without
bond or other security, to compel performance of all of the terms of Section
, and waive the defense of the availability of relief in damages. Representation
on Authority of Parties/Signatories Each person signing this Agreement
represents and warrants that he or she is duly authorized and has legal
capacity to execute and deliver this Agreement. Each party represents
and warrants to the other that the execution and delivery of the Agreement
and the performance of such party’s obligations hereunder have been
duly authorized and that the Agreement is a valid and legal agreement
binding on such party and enforceable in accordance with its terms. Force
Majeure No party shall be liable for any failure to perform its obligations
in connection with any action described in this Agreement, if such failure
results from any act of God, riot, war, civil unrest, flood, earthquake,
or other cause beyond such party’s reasonable control (including
any mechanical, electronic, or communications failure, but excluding failure
caused by a party’s financial condition or negligence). Assignment
Neither party shall voluntarily or by operation of law assign, hypothecate,
give, transfer, mortgage, sublet, license, or otherwise transfer or encumber
all or part of its rights, duties, or other interests in this Agreement
or the proceeds thereof (collectively, “Assignment’), without
the other party’s prior written consent. Any attempt to make an Assignment
in violation of this provision shall be a material default under this
Agreement and any Assignment in violation of this provision shall be null
and void. (u) Arbitration Any controversy, claim or dispute arising out
of or relating to this Agreement, shall be settled by binding arbitration
in [City], [State]. Such arbitration shall be conducted in accordance
with the then prevailing commercial arbitration rules of JAMS/Endispute
(“JAMS”), with the following exceptions if in conflict: (a)
one arbitrator shall be chosen by JAMS; (b) each party to the arbitration
will pay its pro rata share of the expenses and fees of the arbitrator,
together with other expenses of the arbitration incurred or approved by
the arbitrator; and (c) arbitration may proceed in the absence of any
party if written notice (pursuant to the JAMS’ rules and regulations)
of the proceedings has been given to such party. The parties agree to
abide by all decisions and awards rendered in such proceedings. Such decisions
and awards rendered by the arbitrator shall be final and conclusive and
may be entered in any court having jurisdiction thereof as a basis of
judgment and of the issuance of execution for its collection. All such
controversies, claims or disputes shall be settled in this manner in lieu
of any action at law or equity; provided however, that nothing in this
subsection shall be construed as precluding the bringing an action for
injunctive relief or other equitable relief. The arbitrator shall not
have the right to award punitive damages or speculative damages to either
party and shall not have the power to amend this Agreement. The arbitrator
shall be required to follow applicable law. IF FOR ANY REASON THIS ARBITRATION
CLAUSE BECOMES NOT APPLICABLE, THEN EACH PARTY, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL
BY JURY AS TO ANY ISSUE RELATING HERETO IN ANY ACTION, PROCEEDING, OR
COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER
MATTER INVOLVING THE PARTIES HERETO.The form is intended to give the company
a right of first refusal on the transfer or sale of stock held by a company
shareholder. All shareholders and spouses must sign the agreement. The
text in red and sections underlined in red indicate terms that will be
unique to the particular circumstance (e.g. names of companies). Disclaimer:The
viewing and use of this form, agreement or checklist is subject to AllBusiness'
Terms of Use agreement.RIGHT OF FIRST REFUSAL AGREEMENT [name of company]
This Right of First Refusal Agreement (this Agreement) is made on the
date written below, by and among [Name of Company], a California corporation
(the Company), and the parties listed as signatories hereto (the Holders).
In consideration of the mutual promises, covenants and conditions herein
contained and for other good and valuable consideration, the parties hereto
agree as follows: 1. Definitions Certain terms used herein are defined
as follows: (a) “Board of Directors” means the Board of Directors
of the Company and any committee thereof. (b) “Immediate Family”
means any spouse, child, grandchild, parent, brother, or sister of a Holder.
(c) “Shares” means any shares of capital stock of the Company
or any securities convertible into or exchangeable for any class of capital
stock of the Company and all securities into which such Shares may be
converted or reclassified as a result of any merger, consolidation, stock
split, stock dividend, or other recapitalization of the Company, whether
now owned or hereafter acquired. 2. Restrictions on Transfer No Holder
may sell or engage in any transaction which has resulted in or will result
in a change in the beneficial or record ownership of any Shares held by
the Holder, including without limitation a voluntary or involuntary sale,
assignment, transfer, pledge, hypothecation, encumbrance, disposal, loan,
gift, attachment or levy (a Transfer), except as provided in this Agreement,
and any such Transfer of Shares or attempted Transfer of Shares in contravention
of this Agreement shall be void and ineffective for any purpose or confer
on any transferee or purported transferee any rights whatsoever. 3. Right
of First Refusal (a) Each time a Holder proposes to Transfer (or is required
by operation of law or other involuntary transfer) any or all of the Shares
standing in such Holder's name or owned by him or her during the term
of this Agreement, such Holder shall first offer such Shares to the Company
in accordance with the following provisions: (i) Such Holder shall deliver
a written notice (a Notice) to the Company stating (A) such Holder's bona
fide intention to Transfer such Shares, (B) the name and the address of
the proposed transferee, (C) the number of Shares to be transferred, and
(D) the purchase price per Share and terms of payment for which the Holder
proposes to Transfer such Shares. (ii) Within 90 days after receipt of
the Notice, the Company or its designee shall have the first right to
purchase or obtain such Shares, upon the price and terms of payment designated
in the Notice. If the Notice provides for the payment of non-cash consideration,
the Company at its option may pay the consideration in cash equal to the
Company's good faith estimate of the present fair market value of the
non-cash consideration offered. (iii) If the Company or its designee elects
not to purchase or obtain all of the Shares designated in the selling
Holder's Notice, then the Holder may Transfer the Shares referred to in
the Notice to the proposed transferee, providing such Transfer (A) is
completed within 30 days after the expiration of the Company's right to
purchase or obtain such Shares, (B) is made at the price and terms designated
in the Notice, and (C) the proposed Transferee agrees to be bound by the
terms and provisions of this Agreement and to become a party to this Agreement
immediately upon receipt of such Shares. If such Shares are not so transferred,
the selling Holder must give notice in accordance with this paragraph
prior to any other or subsequent Transfer of such Shares. (b) Notwithstanding
Section 3(a), a Holder may Transfer Shares: (i) to a member of the Holder's
Immediate Family or to a trust established for the benefit of a member
or members of the Holder's Immediate Family, (ii) to an affiliate or equity
holder of the Holder, (iii) to a person who is a constituent partner of
the Holder on the date hereof, or (iv) to the estate of any of the foregoing
by gift, will or intestate succession; provided that the Holder or his
representative notifies the Company of such Transfer not less than 10
nor more than 90 days prior to the Transfer and that the proposed transferee
agrees to be bound by the terms and provisions of this Agreement and to
become a party to this Agreement immediately upon the receipt of such
Shares. 4. No Transfer to Competitors A Holder may not Transfer any Shares
to a competitor of the Company, or to any shareholder, partner or other
beneficial holder of an equity ownership interest in a competitor, other
than pursuant to a merger, combination, or other transaction approved
by the Board of Directors. 5. California General Corporation Law Notwithstanding
any provisions to the contrary contained in this Agreement, the Company's
obligations to pay or complete payment for any Shares to be purchased
by it under this Agreement is subject to its being legally permitted to
do so under the tests contained in Sections 500 and 501 of the California
General Corporation Law or any successor statute applicable thereto. 6.
Legend on Stock Certificates Each certificate representing shares owned
of record or beneficially by a party to this Agreement shall be endorsed
with the following legend: THE SHARES EVIDENCED BY THIS CERTIFICATE ARE
SUBJECT TO A RIGHT OF FIRST REFUSAL AGREEMENT BETWEEN [NAME OF COMPANY]
(THE COMPANY) AND THE HOLDERS THAT ARE SIGNATORIES THERETO, PROVIDING
FOR, AMONG OTHER MATTERS, THE COMPANY'S RIGHT OF FIRST REFUSAL TO PURCHASE
THE SECURITIES REPRESENTED BY THIS CERTIFICATE. A COPY OF SUCH AGREEMENT
IS ON FILE AT THE PRINCIPAL BUSINESS OFFICE OF THE COMPANY. Under no circumstances
shall any Transfer of any Shares subject hereto be valid until the proposed
transferee thereof shall have executed and become a party to this Agreement
and thereby shall have become subject to all of the provisions hereof;
and notwithstanding any other provisions of this Agreement, no such Transfer
of any kind shall in any event result in the non-applicability of the
provisions hereof at any time to any of the Shares subject hereto. 7.
Term of Agreement The restrictions on Transfer of Shares set forth in
this Agreement shall terminate upon any of the following: (a) The determination
of the Board of Directors that this Agreement shall be terminated. (b)
The dissolution or bankruptcy of the Company. (c) The consummation of
a public offering for any of the common stock of the Company registered
under the Securities Act of 1933, as amended, on SEC Form S-1 or any successor
form. (d) The following date. Acknowledgments Each Holder acknowledges
that other shareholders of the Company may have restrictions on their
shareholdings different than the terms contained herein. 9. Further Assurances
Each party hereto agrees to perform any and all further acts and to execute
and deliver any documents which may reasonably be necessary to carry out
the provisions of this Agreement. 10. Modification This Agreement as applied
to any Holder may be amended at any time by the written agreement of the
Company and a Holder affected thereby. 11. Will Provisions Each Holder
agrees to insert in his or her will, or to execute a codicil thereto,
directing and authorizing his or her executor to fulfill and comply with
the provisions hereof. 12. Notice Any notice required or permitted hereunder
shall be delivered in person or sent by telecopier, air courier or certified
mail, return receipt requested, postage and fees prepaid in all cases;
in the case of the Company, to the then current address of its then principal
business office, to the attention of the Chairman of its Board of Directors,
and, in the case of a Holder, to the address of such Holder shown on the
signature page hereto, or to such other address as will have been specified
by prior written notice to the sending party. Notice shall be effective
upon delivery if it is hand-delivered; upon receipt if it is transmitted
by telecopier, air courier or registered, certified or express mail; upon
expiration of the third business day after deposit in the United States
mail if mailed from and to an address in the United States; and upon expiration
of the tenth business day after deposit in the United States mail if mailed
from or to an address outside the United States. 13. Succession This Agreement
shall be binding upon and inure to the benefit of the parties hereto and
upon their permitted successors in interest of any kind whatsoever, their
heirs, executors, administrators, and personal representatives. 14. Governing
Law This Agreement will be governed in all respects by the laws of the
State of California as such laws are applied to agreements between California
residents entered into and to be performed entirely within California,
without regard to conflicts of law [principles]. The parties hereby consent
to the exclusive jurisdiction of the state or federal courts located in
the State of California, for the resolution of any disputes arising out
of this Agreement. 15. Counterparts This Agreement may be signed in any
number of counterparts, each of which will be an original, but all of
which together will constitute one and the same instrument. 16. Sole Agreement
This Agreement constitutes the entire agreement and understanding of the
parties hereto with respect to the subject matter hereof and supersedes
any and all prior or contemporaneous agreements and understandings pertaining
thereto whether oral or written. 17. Construction The titles of the sections
of this Agreement are for convenience of reference only and are not to
be considered in construing this Agreement. The language of this Agreement
shall be construed as to its fair meaning and not strictly for or against
any party. 18. Severability If one or more provisions of this Agreement
are held to be unenforceable under applicable law, such provision shall
be excluded from this Agreement and the balance of this Agreement shall
be enforceable in accordance with its terms and interpreted as if such
provisions were as excluded. 19. Attorney Fees In the event that any dispute
among the parties hereto should result in litigation or arbitration, the
prevailing party in such dispute shall be entitled to recover from the
other party all reasonable fees, costs and expenses of enforcing any right
of the prevailing party, including without limitation, reasonable attorneys'
fees and expenses. IN WITNESS WHEREOF, the parties have executed this
Agreement as of the date written below. Date: [NAME OF COMPANY] By: Title:
HOLDERS: Address: [Add signature lines as appropriate.] Consent of Spouse
The undersigned spouse(s) of the party (parties) to the foregoing Agreement
acknowledge(s) on his or her own behalf that: I have read the foregoing
Agreement and I know its contents. I am aware that by its provisions my
spouse grants the Company an option to purchase all of his or her shares
of the Company, including my community interest in them. I hereby consent
to the sale, approve of the provisions of the Agreement, and agree that
those shares and my interest in them are subject to the provisions of
the Agreement and that I will take no action at any time to hinder operation
of the Agreement on those shares or my interest in them. This Agreement,
and any dispute arising from the relationship between the parties to this
Agreement, shall be governed by California law, excluding any laws that
direct the application of another jurisdiction’s laws. Attorney Fees
Provision In any litigation, arbitration, or other proceeding by which
one party either seeks to enforce its rights under this Agreement (whether
in contract, tort, or both) or seeks a declaration of any rights or obligations
under this Agreement, the prevailing party shall be awarded its reasonable
attorney fees, and costs and expenses incurred. Notice Any notices required
or permitted to be given hereunder shall be given in writing and shall
be delivered (a) in person, (b) by certified mail, postage prepaid,
return receipt requested, (c) by facsimile, or (d) by a commercial
overnight courier that guarantees next day delivery and provides a receipt,
and such notices shall be addressed as follows: or to such other address
as either party may from time to time specify in writing to the other
party. Any notice shall be effective only upon delivery, which for any
notice given by facsimile shall mean notice which has been received by
the party to whom it is sent as evidenced by confirmation slip. Modification
of Agreement This Agreement may be supplemented, amended, or modified
only by the mutual agreement of the parties. No supplement, amendment,
or modification of this Agreement shall be binding unless it is in writing
and signed by all parties. Entire Agreement This Agreement and all other
agreements, exhibits, and schedules referred to in this Agreement constitute(s)
the final, complete, and exclusive statement of the terms of the agreement
between the parties pertaining to the subject matter of this Agreement
and supersedes all prior and contemporaneous understandings or agreements
of the parties. This Agreement may not be contradicted by evidence of
any prior or contemporaneous statements or agreements. No party has been
induced to enter into this Agreement by, nor is any party relying on,
any representation, understanding, agreement, commitment or warranty outside
those expressly set forth in this Agreement. Severability of Agreement
If any term or provision of this Agreement is determined to be illegal,
unenforceable, or invalid in whole or in part for any reason, such illegal,
unenforceable, or invalid provisions or part thereof shall be stricken
from this Agreement, and such provision shall not affect the legality,
enforceability, or validity of the remainder of this Agreement. If any
provision or part thereof of this Agreement is stricken in accordance
with the provisions of this section, then this stricken provision shall
be replaced, to the extent possible, with a legal, enforceable, and valid
provision that is as similar in tenor to the stricken provision as is
legally possible. Separate Writings and Exhibits The following [e.g.,
agreements, exhibits, schedules, or other separate writings] constitute
a part of this Agreement and are incorporated into this Agreement by this
reference: [List separate writings by name and date]. Should any inconsistency
exist or arise between a provision of this Agreement and a provision of
any exhibit, schedule, or other incorporated writing, the provision of
this Agreement shall prevail. Time of the Essence Time is of the essence
in respect to all provisions of this Agreement that specify a time for
performance; provided, however, that the foregoing shall not be construed
to limit or deprive a party of the benefits of any grace or use period
allowed in this Agreement. Survival Except as otherwise expressly provided
in this Agreement, representations, warranties, and covenants contained
in this Agreement, or in any instrument, certificate, exhibit, or other
writing intended by the parties to be a part of this Agreement, shall
survive for ___ years after the date of this Agreement. Ambiguities Each
party and its counsel have participated fully in the review and revision
of this Agreement. Any rule of construction to the effect that ambiguities
are to be resolved against the drafting party shall not apply in interpreting
this Agreement. The language in this Agreement shall be interpreted as
to its fair meaning and not strictly for or against any party. Waiver
No waiver of a breach, failure of any condition, or any right or remedy
contained in or granted by the provisions of this Agreement shall be effective
unless it is in writing and signed by the party waiving the breach, failure,
right, or remedy. No waiver of any breach, failure, right, or remedy,
whether or not similar, nor shall any waiver constitute a continuing waiver
unless the writing so specifies. Headings The headings in this Agreement
are included for convenience only and shall neither affect the construction
or interpretation of any provision in this Agreement nor affect any of
the rights or obligations of the parties to this Agreement. Necessary
Acts, Further Assurances The parties shall at their own cost and expense
execute and deliver such further documents and instruments and shall take
such other actions as may be reasonably required or appropriate to evidence
or carry out the intent and purposes of this Agreement. Execution This
Agreement may be executed in counterparts and by fax. Consent to Jurisdiction
and Forum Selection The parties hereto agree that all actions or proceedings
arising in connection with this Agreement shall be tried and litigated
exclusively in the State and Federal courts located in the County of ,
State of . The aforementioned choice of venue is intended by the parties
to be mandatory and not permissive in nature, thereby precluding the possibility
of litigation between the parties with respect to or arising out of this
Agreement in any jurisdiction other than that specified in this paragraph.
Each party hereby waives any right it may have to assert the doctrine
of forum non conveniens or similar doctrine or to object to venue with
respect to any proceeding brought in accordance with this paragraph, and
stipulates that the State and Federal courts located in the County of
, State of shall have in personam jurisdiction and venue over each of
them for the purpose of litigating any dispute, controversy, or proceeding
arising out of or related to this Agreement. Each party hereby authorizes
and accepts service of process sufficient for personal jurisdiction in
any action against it as contemplated by this paragraph by registered
or certified mail, return receipt requested, postage prepaid, to its address
for the giving of notices as set forth in this Agreement. Any final judgement
rendered against a party in any action or proceeding shall be conclusive
as to the subject of such final judgement and may be enforced in other
jurisdictions in any manner provided by law. Jury Trial Waivers To the
fullest extent permitted by law, and as separately bargained-for-consideration,
each party hereby waives any right to trial by jury in any action, suit,
proceeding, or counterclaim of any kind arising out of or relating to
this Agreement. Specific Performance The parties acknowledge that it will
be impossible to measure in money the damage to them caused by any failure
to comply with the covenants set forth in Section , that each such covenant
is material, and that in the event of any such failure, the injured party
will not have an adequate remedy at law or in damages. Therefore, the
parties consent to the issuance of an injunction or the enforcement of
other equitable remedies against them at the suit of the other, without
bond or other security, to compel performance of all of the terms of Section
, and waive the defense of the availability of relief in damages. Representation
on Authority of Parties/Signatories Each person signing this Agreement
represents and warrants that he or she is duly authorized and has legal
capacity to execute and deliver this Agreement. Each party represents
and warrants to the other that the execution and delivery of the Agreement
and the performance of such party’s obligations hereunder have been
duly authorized and that the Agreement is a valid and legal agreement
binding on such party and enforceable in accordance with its terms. Force
Majeure No party shall be liable for any failure to perform its obligations
in connection with any action described in this Agreement, if such failure
results from any act of God, riot, war, civil unrest, flood, earthquake,
or other cause beyond such party’s reasonable control (including
any mechanical, electronic, or communications failure, but excluding failure
caused by a party’s financial condition or negligence). Assignment
Neither party shall voluntarily or by operation of law assign, hypothecate,
give, transfer, mortgage, sublet, license, or otherwise transfer or encumber
all or part of its rights, duties, or other interests in this Agreement
or the proceeds thereof (collectively, “Assignment’), without
the other party’s prior written consent. Any attempt to make an Assignment
in violation of this provision shall be a material default under this
Agreement and any Assignment in violation of this provision shall be null
and void. (u) Arbitration Any controversy, claim or dispute arising out
of or relating to this Agreement, shall be settled by binding arbitration
in [City], [State]. Such arbitration shall be conducted in accordance
with the then prevailing commercial arbitration rules of JAMS/Endispute
(“JAMS”), with the following exceptions if in conflict: (a)
one arbitrator shall be chosen by JAMS; (b) each party to the arbitration
will pay its pro rata share of the expenses and fees of the arbitrator,
together with other expenses of the arbitration incurred or approved by
the arbitrator; and (c) arbitration may proceed in the absence of any
party if written notice (pursuant to the JAMS’ rules and regulations)
of the proceedings has been given to such party. The parties agree to
abide by all decisions and awards rendered in such proceedings. Such decisions
and awards rendered by the arbitrator shall be final and conclusive and
may be entered in any court having jurisdiction thereof as a basis of
judgment and of the issuance of execution for its collection. All such
controversies, claims or disputes shall be settled in this manner in lieu
of any action at law or equity; provided however, that nothing in this
subsection shall be construed as precluding the bringing an action for
injunctive relief or other equitable relief. The arbitrator shall not
have the right to award punitive damages or speculative damages to either
party and shall not have the power to amend this Agreement. The arbitrator
shall be required to follow applicable law. IF FOR ANY REASON THIS ARBITRATION
CLAUSE BECOMES NOT APPLICABLE, THEN EACH PARTY, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL
BY JURY AS TO ANY ISSUE RELATING HERETO IN ANY ACTION, PROCEEDING, OR
COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER
MATTER INVOLVING THE PARTIES HERETO.The form is intended to give the company
a right of first refusal on the transfer or sale of stock held by a company
shareholder. All shareholders and spouses must sign the agreement. The
text in red and sections underlined in red indicate terms that will be
unique to the particular circumstance (e.g. names of companies). Disclaimer:The
viewing and use of this form, agreement or checklist is subject to AllBusiness'
Terms of Use agreement.RIGHT OF FIRST REFUSAL AGREEMENT [name of company]
This Right of First Refusal Agreement (this Agreement) is made on the
date written below, by and among [Name of Company], a California corporation
(the Company), and the parties listed as signatories hereto (the Holders).
In consideration of the mutual promises, covenants and conditions herein
contained and for other good and valuable consideration, the parties hereto
agree as follows: 1. Definitions Certain terms used herein are defined
as follows: (a) “Board of Directors” means the Board of Directors
of the Company and any committee thereof. (b) “Immediate Family”
means any spouse, child, grandchild, parent, brother, or sister of a Holder.
(c) “Shares” means any shares of capital stock of the Company
or any securities convertible into or exchangeable for any class of capital
stock of the Company and all securities into which such Shares may be
converted or reclassified as a result of any merger, consolidation, stock
split, stock dividend, or other recapitalization of the Company, whether
now owned or hereafter acquired. 2. Restrictions on Transfer No Holder
may sell or engage in any transaction which has resulted in or will result
in a change in the beneficial or record ownership of any Shares held by
the Holder, including without limitation a voluntary or involuntary sale,
assignment, transfer, pledge, hypothecation, encumbrance, disposal, loan,
gift, attachment or levy (a Transfer), except as provided in this Agreement,
and any such Transfer of Shares or attempted Transfer of Shares in contravention
of this Agreement shall be void and ineffective for any purpose or confer
on any transferee or purported transferee any rights whatsoever. 3. Right
of First Refusal (a) Each time a Holder proposes to Transfer (or is required
by operation of law or other involuntary transfer) any or all of the Shares
standing in such Holder's name or owned by him or her during the term
of this Agreement, such Holder shall first offer such Shares to the Company
in accordance with the following provisions: (i) Such Holder shall deliver
a written notice (a Notice) to the Company stating (A) such Holder's bona
fide intention to Transfer such Shares, (B) the name and the address of
the proposed transferee, (C) the number of Shares to be transferred, and
(D) the purchase price per Share and terms of payment for which the Holder
proposes to Transfer such Shares. (ii) Within 90 days after receipt of
the Notice, the Company or its designee shall have the first right to
purchase or obtain such Shares, upon the price and terms of payment designated
in the Notice. If the Notice provides for the payment of non-cash consideration,
the Company at its option may pay the consideration in cash equal to the
Company's good faith estimate of the present fair market value of the
non-cash consideration offered. (iii) If the Company or its designee elects
not to purchase or obtain all of the Shares designated in the selling
Holder's Notice, then the Holder may Transfer the Shares referred to in
the Notice to the proposed transferee, providing such Transfer (A) is
completed within 30 days after the expiration of the Company's right to
purchase or obtain such Shares, (B) is made at the price and terms designated
in the Notice, and (C) the proposed Transferee agrees to be bound by the
terms and provisions of this Agreement and to become a party to this Agreement
immediately upon receipt of such Shares. If such Shares are not so transferred,
the selling Holder must give notice in accordance with this paragraph
prior to any other or subsequent Transfer of such Shares. (b) Notwithstanding
Section 3(a), a Holder may Transfer Shares: (i) to a member of the Holder's
Immediate Family or to a trust established for the benefit of a member
or members of the Holder's Immediate Family, (ii) to an affiliate or equity
holder of the Holder, (iii) to a person who is a constituent partner of
the Holder on the date hereof, or (iv) to the estate of any of the foregoing
by gift, will or intestate succession; provided that the Holder or his
representative notifies the Company of such Transfer not less than 10
nor more than 90 days prior to the Transfer and that the proposed transferee
agrees to be bound by the terms and provisions of this Agreement and to
become a party to this Agreement immediately upon the receipt of such
Shares. 4. No Transfer to Competitors A Holder may not Transfer any Shares
to a competitor of the Company, or to any shareholder, partner or other
beneficial holder of an equity ownership interest in a competitor, other
than pursuant to a merger, combination, or other transaction approved
by the Board of Directors. 5. California General Corporation Law Notwithstanding
any provisions to the contrary contained in this Agreement, the Company's
obligations to pay or complete payment for any Shares to be purchased
by it under this Agreement is subject to its being legally permitted to
do so under the tests contained in Sections 500 and 501 of the California
General Corporation Law or any successor statute applicable thereto. 6.
Legend on Stock Certificates Each certificate representing shares owned
of record or beneficially by a party to this Agreement shall be endorsed
with the following legend: THE SHARES EVIDENCED BY THIS CERTIFICATE ARE
SUBJECT TO A RIGHT OF FIRST REFUSAL AGREEMENT BETWEEN [NAME OF COMPANY]
(THE COMPANY) AND THE HOLDERS THAT ARE SIGNATORIES THERETO, PROVIDING
FOR, AMONG OTHER MATTERS, THE COMPANY'S RIGHT OF FIRST REFUSAL TO PURCHASE
THE SECURITIES REPRESENTED BY THIS CERTIFICATE. A COPY OF SUCH AGREEMENT
IS ON FILE AT THE PRINCIPAL BUSINESS OFFICE OF THE COMPANY. Under no circumstances
shall any Transfer of any Shares subject hereto be valid until the proposed
transferee thereof shall have executed and become a party to this Agreement
and thereby shall have become subject to all of the provisions hereof;
and notwithstanding any other provisions of this Agreement, no such Transfer
of any kind shall in any event result in the non-applicability of the
provisions hereof at any time to any of the Shares subject hereto. 7.
Term of Agreement The restrictions on Transfer of Shares set forth in
this Agreement shall terminate upon any of the following: (a) The determination
of the Board of Directors that this Agreement shall be terminated. (b)
The dissolution or bankruptcy of the Company. (c) The consummation of
a public offering for any of the common stock of the Company registered
under the Securities Act of 1933, as amended, on SEC Form S-1 or any successor
form. (d) The following date. Acknowledgments Each Holder acknowledges
that other shareholders of the Company may have restrictions on their
shareholdings different than the terms contained herein. 9. Further Assurances
Each party hereto agrees to perform any and all further acts and to execute
and deliver any documents which may reasonably be necessary to carry out
the provisions of this Agreement. 10. Modification This Agreement as applied
to any Holder may be amended at any time by the written agreement of the
Company and a Holder affected thereby. 11. Will Provisions Each Holder
agrees to insert in his or her will, or to execute a codicil thereto,
directing and authorizing his or her executor to fulfill and comply with
the provisions hereof. 12. Notice Any notice required or permitted hereunder
shall be delivered in person or sent by telecopier, air courier or certified
mail, return receipt requested, postage and fees prepaid in all cases;
in the case of the Company, to the then current address of its then principal
business office, to the attention of the Chairman of its Board of Directors,
and, in the case of a Holder, to the address of such Holder shown on the
signature page hereto, or to such other address as will have been specified
by prior written notice to the sending party. Notice shall be effective
upon delivery if it is hand-delivered; upon receipt if it is transmitted
by telecopier, air courier or registered, certified or express mail; upon
expiration of the third business day after deposit in the United States
mail if mailed from and to an address in the United States; and upon expiration
of the tenth business day after deposit in the United States mail if mailed
from or to an address outside the United States. 13. Succession This Agreement
shall be binding upon and inure to the benefit of the parties hereto and
upon their permitted successors in interest of any kind whatsoever, their
heirs, executors, administrators, and personal representatives. 14. Governing
Law This Agreement will be governed in all respects by the laws of the
State of California as such laws are applied to agreements between California
residents entered into and to be performed entirely within California,
without regard to conflicts of law [principles]. The parties hereby consent
to the exclusive jurisdiction of the state or federal courts located in
the State of California, for the resolution of any disputes arising out
of this Agreement. 15. Counterparts This Agreement may be signed in any
number of counterparts, each of which will be an original, but all of
which together will constitute one and the same instrument. 16. Sole Agreement
This Agreement constitutes the entire agreement and understanding of the
parties hereto with respect to the subject matter hereof and supersedes
any and all prior or contemporaneous agreements and understandings pertaining
thereto whether oral or written. 17. Construction The titles of the sections
of this Agreement are for convenience of reference only and are not to
be considered in construing this Agreement. The language of this Agreement
shall be construed as to its fair meaning and not strictly for or against
any party. 18. Severability If one or more provisions of this Agreement
are held to be unenforceable under applicable law, such provision shall
be excluded from this Agreement and the balance of this Agreement shall
be enforceable in accordance with its terms and interpreted as if such
provisions were as excluded. 19. Attorney Fees In the event that any dispute
among the parties hereto should result in litigation or arbitration, the
prevailing party in such dispute shall be entitled to recover from the
other party all reasonable fees, costs and expenses of enforcing any right
of the prevailing party, including without limitation, reasonable attorneys'
fees and expenses. IN WITNESS WHEREOF, the parties have executed this
Agreement as of the date written below. Date: [NAME OF COMPANY] By: Title:
HOLDERS: Address: [Add signature lines as appropriate.] Consent of Spouse
The undersigned spouse(s) of the party (parties) to the foregoing Agreement
acknowledge(s) on his or her own behalf that: I have read the foregoing
Agreement and I know its contents. I am aware that by its provisions my
spouse grants the Company an option to purchase all of his or her shares
of the Company, including my community interest in them. I hereby consent
to the sale, approve of the provisions of the Agreement, and agree that
those shares and my interest in them are subject to the provisions of
the Agreement and that I will take no action at any time to hinder operation
of the Agreement on those shares or my interest in them. This Agreement,
and any dispute arising from the relationship between the parties to this
Agreement, shall be governed by California law, excluding any laws that
direct the application of another jurisdiction’s laws. Attorney Fees
Provision In any litigation, arbitration, or other proceeding by which
one party either seeks to enforce its rights under this Agreement (whether
in contract, tort, or both) or seeks a declaration of any rights or obligations
under this Agreement, the prevailing party shall be awarded its reasonable
attorney fees, and costs and expenses incurred. Notice Any notices required
or permitted to be given hereunder shall be given in writing and shall
be delivered (a) in person, (b) by certified mail, postage prepaid,
return receipt requested, (c) by facsimile, or (d) by a commercial
overnight courier that guarantees next day delivery and provides a receipt,
and such notices shall be addressed as follows: or to such other address
as either party may from time to time specify in writing to the other
party. Any notice shall be effective only upon delivery, which for any
notice given by facsimile shall mean notice which has been received by
the party to whom it is sent as evidenced by confirmation slip. Modification
of Agreement This Agreement may be supplemented, amended, or modified
only by the mutual agreement of the parties. No supplement, amendment,
or modification of this Agreement shall be binding unless it is in writing
and signed by all parties. Entire Agreement This Agreement and all other
agreements, exhibits, and schedules referred to in this Agreement constitute(s)
the final, complete, and exclusive statement of the terms of the agreement
between the parties pertaining to the subject matter of this Agreement
and supersedes all prior and contemporaneous understandings or agreements
of the parties. This Agreement may not be contradicted by evidence of
any prior or contemporaneous statements or agreements. No party has been
induced to enter into this Agreement by, nor is any party relying on,
any representation, understanding, agreement, commitment or warranty outside
those expressly set forth in this Agreement. Severability of Agreement
If any term or provision of this Agreement is determined to be illegal,
unenforceable, or invalid in whole or in part for any reason, such illegal,
unenforceable, or invalid provisions or part thereof shall be stricken
from this Agreement, and such provision shall not affect the legality,
enforceability, or validity of the remainder of this Agreement. If any
provision or part thereof of this Agreement is stricken in accordance
with the provisions of this section, then this stricken provision shall
be replaced, to the extent possible, with a legal, enforceable, and valid
provision that is as similar in tenor to the stricken provision as is
legally possible. Separate Writings and Exhibits The following [e.g.,
agreements, exhibits, schedules, or other separate writings] constitute
a part of this Agreement and are incorporated into this Agreement by this
reference: [List separate writings by name and date]. Should any inconsistency
exist or arise between a provision of this Agreement and a provision of
any exhibit, schedule, or other incorporated writing, the provision of
this Agreement shall prevail. Time of the Essence Time is of the essence
in respect to all provisions of this Agreement that specify a time for
performance; provided, however, that the foregoing shall not be construed
to limit or deprive a party of the benefits of any grace or use period
allowed in this Agreement. Survival Except as otherwise expressly provided
in this Agreement, representations, warranties, and covenants contained
in this Agreement, or in any instrument, certificate, exhibit, or other
writing intended by the parties to be a part of this Agreement, shall
survive for ___ years after the date of this Agreement. Ambiguities Each
party and its counsel have participated fully in the review and revision
of this Agreement. Any rule of construction to the effect that ambiguities
are to be resolved against the drafting party shall not apply in interpreting
this Agreement. The language in this Agreement shall be interpreted as
to its fair meaning and not strictly for or against any party. Waiver
No waiver of a breach, failure of any condition, or any right or remedy
contained in or granted by the provisions of this Agreement shall be effective
unless it is in writing and signed by the party waiving the breach, failure,
right, or remedy. No waiver of any breach, failure, right, or remedy,
whether or not similar, nor shall any waiver constitute a continuing waiver
unless the writing so specifies. Headings The headings in this Agreement
are included for convenience only and shall neither affect the construction
or interpretation of any provision in this Agreement nor affect any of
the rights or obligations of the parties to this Agreement. Necessary
Acts, Further Assurances The parties shall at their own cost and expense
execute and deliver such further documents and instruments and shall take
such other actions as may be reasonably required or appropriate to evidence
or carry out the intent and purposes of this Agreement. Execution This
Agreement may be executed in counterparts and by fax. Consent to Jurisdiction
and Forum Selection The parties hereto agree that all actions or proceedings
arising in connection with this Agreement shall be tried and litigated
exclusively in the State and Federal courts located in the County of ,
State of . The aforementioned choice of venue is intended by the parties
to be mandatory and not permissive in nature, thereby precluding the possibility
of litigation between the parties with respect to or arising out of this
Agreement in any jurisdiction other than that specified in this paragraph.
Each party hereby waives any right it may have to assert the doctrine
of forum non conveniens or similar doctrine or to object to venue with
respect to any proceeding brought in accordance with this paragraph, and
stipulates that the State and Federal courts located in the County of
, State of shall have in personam jurisdiction and venue over each of
them for the purpose of litigating any dispute, controversy, or proceeding
arising out of or related to this Agreement. Each party hereby authorizes
and accepts service of process sufficient for personal jurisdiction in
any action against it as contemplated by this paragraph by registered
or certified mail, return receipt requested, postage prepaid, to its address
for the giving of notices as set forth in this Agreement. Any final judgement
rendered against a party in any action or proceeding shall be conclusive
as to the subject of such final judgement and may be enforced in other
jurisdictions in any manner provided by law. Jury Trial Waivers To the
fullest extent permitted by law, and as separately bargained-for-consideration,
each party hereby waives any right to trial by jury in any action, suit,
proceeding, or counterclaim of any kind arising out of or relating to
this Agreement. Specific Performance The parties acknowledge that it will
be impossible to measure in money the damage to them caused by any failure
to comply with the covenants set forth in Section , that each such covenant
is material, and that in the event of any such failure, the injured party
will not have an adequate remedy at law or in damages. Therefore, the
parties consent to the issuance of an injunction or the enforcement of
other equitable remedies against them at the suit of the other, without
bond or other security, to compel performance of all of the terms of Section
, and waive the defense of the availability of relief in damages. Representation
on Authority of Parties/Signatories Each person signing this Agreement
represents and warrants that he or she is duly authorized and has legal
capacity to execute and deliver this Agreement. Each party represents
and warrants to the other that the execution and delivery of the Agreement
and the performance of such party’s obligations hereunder have been
duly authorized and that the Agreement is a valid and legal agreement
binding on such party and enforceable in accordance with its terms. Force
Majeure No party shall be liable for any failure to perform its obligations
in connection with any action described in this Agreement, if such failure
results from any act of God, riot, war, civil unrest, flood, earthquake,
or other cause beyond such party’s reasonable control (including
any mechanical, electronic, or communications failure, but excluding failure
caused by a party’s financial condition or negligence). Assignment
Neither party shall voluntarily or by operation of law assign, hypothecate,
give, transfer, mortgage, sublet, license, or otherwise transfer or encumber
all or part of its rights, duties, or other interests in this Agreement
or the proceeds thereof (collectively, “Assignment’), without
the other party’s prior written consent. Any attempt to make an Assignment
in violation of this provision shall be a material default under this
Agreement and any Assignment in violation of this provision shall be null
and void. (u) Arbitration Any controversy, claim or dispute arising out
of or relating to this Agreement, shall be settled by binding arbitration
in [City], [State]. Such arbitration shall be conducted in accordance
with the then prevailing commercial arbitration rules of JAMS/Endispute
(“JAMS”), with the following exceptions if in conflict: (a)
one arbitrator shall be chosen by JAMS; (b) each party to the arbitration
will pay its pro rata share of the expenses and fees of the arbitrator,
together with other expenses of the arbitration incurred or approved by
the arbitrator; and (c) arbitration may proceed in the absence of any
party if written notice (pursuant to the JAMS’ rules and regulations)
of the proceedings has been given to such party. The parties agree to
abide by all decisions and awards rendered in such proceedings. Such decisions
and awards rendered by the arbitrator shall be final and conclusive and
may be entered in any court having jurisdiction thereof as a basis of
judgment and of the issuance of execution for its collection. All such
controversies, claims or disputes shall be settled in this manner in lieu
of any action at law or equity; provided however, that nothing in this
subsection shall be construed as precluding the bringing an action for
injunctive relief or other equitable relief. The arbitrator shall not
have the right to award punitive damages or speculative damages to either
party and shall not have the power to amend this Agreement. The arbitrator
shall be required to follow applicable law. IF FOR ANY REASON THIS ARBITRATION
CLAUSE BECOMES NOT APPLICABLE, THEN EACH PARTY, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL
BY JURY AS TO ANY ISSUE RELATING HERETO IN ANY ACTION, PROCEEDING, OR
COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER
MATTER INVOLVING THE PARTIES HERETO.The form is intended to give the company
a right of first refusal on the transfer or sale of stock held by a company
shareholder. All shareholders and spouses must sign the agreement. The
text in red and sections underlined in red indicate terms that will be
unique to the particular circumstance (e.g. names of companies). Disclaimer:The
viewing and use of this form, agreement or checklist is subject to AllBusiness'
Terms of Use agreement.RIGHT OF FIRST REFUSAL AGREEMENT [name of company]
This Right of First Refusal Agreement (this Agreement) is made on the
date written below, by and among [Name of Company], a California corporation
(the Company), and the parties listed as signatories hereto (the Holders).
In consideration of the mutual promises, covenants and conditions herein
contained and for other good and valuable consideration, the parties hereto
agree as follows: 1. Definitions Certain terms used herein are defined
as follows: (a) “Board of Directors” means the Board of Directors
of the Company and any committee thereof. (b) “Immediate Family”
means any spouse, child, grandchild, parent, brother, or sister of a Holder.
(c) “Shares” means any shares of capital stock of the Company
or any securities convertible into or exchangeable for any class of capital
stock of the Company and all securities into which such Shares may be
converted or reclassified as a result of any merger, consolidation, stock
split, stock dividend, or other recapitalization of the Company, whether
now owned or hereafter acquired. 2. Restrictions on Transfer No Holder
may sell or engage in any transaction which has resulted in or will result
in a change in the beneficial or record ownership of any Shares held by
the Holder, including without limitation a voluntary or involuntary sale,
assignment, transfer, pledge, hypothecation, encumbrance, disposal, loan,
gift, attachment or levy (a Transfer), except as provided in this Agreement,
and any such Transfer of Shares or attempted Transfer of Shares in contravention
of this Agreement shall be void and ineffective for any purpose or confer
on any transferee or purported transferee any rights whatsoever. 3. Right
of First Refusal (a) Each time a Holder proposes to Transfer (or is required
by operation of law or other involuntary transfer) any or all of the Shares
standing in such Holder's name or owned by him or her during the term
of this Agreement, such Holder shall first offer such Shares to the Company
in accordance with the following provisions: (i) Such Holder shall deliver
a written notice (a Notice) to the Company stating (A) such Holder's bona
fide intention to Transfer such Shares, (B) the name and the address of
the proposed transferee, (C) the number of Shares to be transferred, and
(D) the purchase price per Share and terms of payment for which the Holder
proposes to Transfer such Shares. (ii) Within 90 days after receipt of
the Notice, the Company or its designee shall have the first right to
purchase or obtain such Shares, upon the price and terms of payment designated
in the Notice. If the Notice provides for the payment of non-cash consideration,
the Company at its option may pay the consideration in cash equal to the
Company's good faith estimate of the present fair market value of the
non-cash consideration offered. (iii) If the Company or its designee elects
not to purchase or obtain all of the Shares designated in the selling
Holder's Notice, then the Holder may Transfer the Shares referred to in
the Notice to the proposed transferee, providing such Transfer (A) is
completed within 30 days after the expiration of the Company's right to
purchase or obtain such Shares, (B) is made at the price and terms designated
in the Notice, and (C) the proposed Transferee agrees to be bound by the
terms and provisions of this Agreement and to become a party to this Agreement
immediately upon receipt of such Shares. If such Shares are not so transferred,
the selling Holder must give notice in accordance with this paragraph
prior to any other or subsequent Transfer of such Shares. (b) Notwithstanding
Section 3(a), a Holder may Transfer Shares: (i) to a member of the Holder's
Immediate Family or to a trust established for the benefit of a member
or members of the Holder's Immediate Family, (ii) to an affiliate or equity
holder of the Holder, (iii) to a person who is a constituent partner of
the Holder on the date hereof, or (iv) to the estate of any of the foregoing
by gift, will or intestate succession; provided that the Holder or his
representative notifies the Company of such Transfer not less than 10
nor more than 90 days prior to the Transfer and that the proposed transferee
agrees to be bound by the terms and provisions of this Agreement and to
become a party to this Agreement immediately upon the receipt of such
Shares. 4. No Transfer to Competitors A Holder may not Transfer any Shares
to a competitor of the Company, or to any shareholder, partner or other
beneficial holder of an equity ownership interest in a competitor, other
than pursuant to a merger, combination, or other transaction approved
by the Board of Directors. 5. California General Corporation Law Notwithstanding
any provisions to the contrary contained in this Agreement, the Company's
obligations to pay or complete payment for any Shares to be purchased
by it under this Agreement is subject to its being legally permitted to
do so under the tests contained in Sections 500 and 501 of the California
General Corporation Law or any successor statute applicable thereto. 6.
Legend on Stock Certificates Each certificate representing shares owned
of record or beneficially by a party to this Agreement shall be endorsed
with the following legend: THE SHARES EVIDENCED BY THIS CERTIFICATE ARE
SUBJECT TO A RIGHT OF FIRST REFUSAL AGREEMENT BETWEEN [NAME OF COMPANY]
(THE COMPANY) AND THE HOLDERS THAT ARE SIGNATORIES THERETO, PROVIDING
FOR, AMONG OTHER MATTERS, THE COMPANY'S RIGHT OF FIRST REFUSAL TO PURCHASE
THE SECURITIES REPRESENTED BY THIS CERTIFICATE. A COPY OF SUCH AGREEMENT
IS ON FILE AT THE PRINCIPAL BUSINESS OFFICE OF THE COMPANY. Under no circumstances
shall any Transfer of any Shares subject hereto be valid until the proposed
transferee thereof shall have executed and become a party to this Agreement
and thereby shall have become subject to all of the provisions hereof;
and notwithstanding any other provisions of this Agreement, no such Transfer
of any kind shall in any event result in the non-applicability of the
provisions hereof at any time to any of the Shares subject hereto. 7.
Term of Agreement The restrictions on Transfer of Shares set forth in
this Agreement shall terminate upon any of the following: (a) The determination
of the Board of Directors that this Agreement shall be terminated. (b)
The dissolution or bankruptcy of the Company. (c) The consummation of
a public offering for any of the common stock of the Company registered
under the Securities Act of 1933, as amended, on SEC Form S-1 or any successor
form. (d) The following date. Acknowledgments Each Holder acknowledges
that other shareholders of the Company may have restrictions on their
shareholdings different than the terms contained herein. 9. Further Assurances
Each party hereto agrees to perform any and all further acts and to execute
and deliver any documents which may reasonably be necessary to carry out
the provisions of this Agreement. 10. Modification This Agreement as applied
to any Holder may be amended at any time by the written agreement of the
Company and a Holder affected thereby. 11. Will Provisions Each Holder
agrees to insert in his or her will, or to execute a codicil thereto,
directing and authorizing his or her executor to fulfill and comply with
the provisions hereof. 12. Notice Any notice required or permitted hereunder
shall be delivered in person or sent by telecopier, air courier or certified
mail, return receipt requested, postage and fees prepaid in all cases;
in the case of the Company, to the then current address of its then principal
business office, to the attention of the Chairman of its Board of Directors,
and, in the case of a Holder, to the address of such Holder shown on the
signature page hereto, or to such other address as will have been specified
by prior written notice to the sending party. Notice shall be effective
upon delivery if it is hand-delivered; upon receipt if it is transmitted
by telecopier, air courier or registered, certified or express mail; upon
expiration of the third business day after deposit in the United States
mail if mailed from and to an address in the United States; and upon expiration
of the tenth business day after deposit in the United States mail if mailed
from or to an address outside the United States. 13. Succession This Agreement
shall be binding upon and inure to the benefit of the parties hereto and
upon their permitted successors in interest of any kind whatsoever, their
heirs, executors, administrators, and personal representatives. 14. Governing
Law This Agreement will be governed in all respects by the laws of the
State of California as such laws are applied to agreements between California
residents entered into and to be performed entirely within California,
without regard to conflicts of law [principles]. The parties hereby consent
to the exclusive jurisdiction of the state or federal courts located in
the State of California, for the resolution of any disputes arising out
of this Agreement. 15. Counterparts This Agreement may be signed in any
number of counterparts, each of which will be an original, but all of
which together will constitute one and the same instrument. 16. Sole Agreement
This Agreement constitutes the entire agreement and understanding of the
parties hereto with respect to the subject matter hereof and supersedes
any and all prior or contemporaneous agreements and understandings pertaining
thereto whether oral or written. 17. Construction The titles of the sections
of this Agreement are for convenience of reference only and are not to
be considered in construing this Agreement. The language of this Agreement
shall be construed as to its fair meaning and not strictly for or against
any party. 18. Severability If one or more provisions of this Agreement
are held to be unenforceable under applicable law, such provision shall
be excluded from this Agreement and the balance of this Agreement shall
be enforceable in accordance with its terms and interpreted as if such
provisions were as excluded. 19. Attorney Fees In the event that any dispute
among the parties hereto should result in litigation or arbitration, the
prevailing party in such dispute shall be entitled to recover from the
other party all reasonable fees, costs and expenses of enforcing any right
of the prevailing party, including without limitation, reasonable attorneys'
fees and expenses. IN WITNESS WHEREOF, the parties have executed this
Agreement as of the date written below. Date: [NAME OF COMPANY] By: Title:
HOLDERS: Address: [Add signature lines as appropriate.] Consent of Spouse
The undersigned spouse(s) of the party (parties) to the foregoing Agreement
acknowledge(s) on his or her own behalf that: I have read the foregoing
Agreement and I know its contents. I am aware that by its provisions my
spouse grants the Company an option to purchase all of his or her shares
of the Company, including my community interest in them. I hereby consent
to the sale, approve of the provisions of the Agreement, and agree that
those shares and my interest in them are subject to the provisions of
the Agreement and that I will take no action at any time to hinder operation
of the Agreement on those shares or my interest in them. This Agreement,
and any dispute arising from the relationship between the parties to this
Agreement, shall be governed by California law, excluding any laws that
direct the application of another jurisdiction’s laws. Attorney Fees
Provision In any litigation, arbitration, or other proceeding by which
one party either seeks to enforce its rights under this Agreement (whether
in contract, tort, or both) or seeks a declaration of any rights or obligations
under this Agreement, the prevailing party shall be awarded its reasonable
attorney fees, and costs and expenses incurred. Notice Any notices required
or permitted to be given hereunder shall be given in writing and shall
be delivered (a) in person, (b) by certified mail, postage prepaid,
return receipt requested, (c) by facsimile, or (d) by a commercial
overnight courier that guarantees next day delivery and provides a receipt,
and such notices shall be addressed as follows: or to such other address
as either party may from time to time specify in writing to the other
party. Any notice shall be effective only upon delivery, which for any
notice given by facsimile shall mean notice which has been received by
the party to whom it is sent as evidenced by confirmation slip. Modification
of Agreement This Agreement may be supplemented, amended, or modified
only by the mutual agreement of the parties. No supplement, amendment,
or modification of this Agreement shall be binding unless it is in writing
and signed by all parties. Entire Agreement This Agreement and all other
agreements, exhibits, and schedules referred to in this Agreement constitute(s)
the final, complete, and exclusive statement of the terms of the agreement
between the parties pertaining to the subject matter of this Agreement
and supersedes all prior and contemporaneous understandings or agreements
of the parties. This Agreement may not be contradicted by evidence of
any prior or contemporaneous statements or agreements. No party has been
induced to enter into this Agreement by, nor is any party relying on,
any representation, understanding, agreement, commitment or warranty outside
those expressly set forth in this Agreement. Severability of Agreement
If any term or provision of this Agreement is determined to be illegal,
unenforceable, or invalid in whole or in part for any reason, such illegal,
unenforceable, or invalid provisions or part thereof shall be stricken
from this Agreement, and such provision shall not affect the legality,
enforceability, or validity of the remainder of this Agreement. If any
provision or part thereof of this Agreement is stricken in accordance
with the provisions of this section, then this stricken provision shall
be replaced, to the extent possible, with a legal, enforceable, and valid
provision that is as similar in tenor to the stricken provision as is
legally possible. Separate Writings and Exhibits The following [e.g.,
agreements, exhibits, schedules, or other separate writings] constitute
a part of this Agreement and are incorporated into this Agreement by this
reference: [List separate writings by name and date]. Should any inconsistency
exist or arise between a provision of this Agreement and a provision of
any exhibit, schedule, or other incorporated writing, the provision of
this Agreement shall prevail. Time of the Essence Time is of the essence
in respect to all provisions of this Agreement that specify a time for
performance; provided, however, that the foregoing shall not be construed
to limit or deprive a party of the benefits of any grace or use period
allowed in this Agreement. Survival Except as otherwise expressly provided
in this Agreement, representations, warranties, and covenants contained
in this Agreement, or in any instrument, certificate, exhibit, or other
writing intended by the parties to be a part of this Agreement, shall
survive for ___ years after the date of this Agreement. Ambiguities Each
party and its counsel have participated fully in the review and revision
of this Agreement. Any rule of construction to the effect that ambiguities
are to be resolved against the drafting party shall not apply in interpreting
this Agreement. The language in this Agreement shall be interpreted as
to its fair meaning and not strictly for or against any party. Waiver
No waiver of a breach, failure of any condition, or any right or remedy
contained in or granted by the provisions of this Agreement shall be effective
unless it is in writing and signed by the party waiving the breach, failure,
right, or remedy. No waiver of any breach, failure, right, or remedy,
whether or not similar, nor shall any waiver constitute a continuing waiver
unless the writing so specifies. Headings The headings in this Agreement
are included for convenience only and shall neither affect the construction
or interpretation of any provision in this Agreement nor affect any of
the rights or obligations of the parties to this Agreement. Necessary
Acts, Further Assurances The parties shall at their own cost and expense
execute and deliver such further documents and instruments and shall take
such other actions as may be reasonably required or appropriate to evidence
or carry out the intent and purposes of this Agreement. Execution This
Agreement may be executed in counterparts and by fax. Consent to Jurisdiction
and Forum Selection The parties hereto agree that all actions or proceedings
arising in connection with this Agreement shall be tried and litigated
exclusively in the State and Federal courts located in the County of ,
State of . The aforementioned choice of venue is intended by the parties
to be mandatory and not permissive in nature, thereby precluding the possibility
of litigation between the parties with respect to or arising out of this
Agreement in any jurisdiction other than that specified in this paragraph.
Each party hereby waives any right it may have to assert the doctrine
of forum non conveniens or similar doctrine or to object to venue with
respect to any proceeding brought in accordance with this paragraph, and
stipulates that the State and Federal courts located in the County of
, State of shall have in personam jurisdiction and venue over each of
them for the purpose of litigating any dispute, controversy, or proceeding
arising out of or related to this Agreement. Each party hereby authorizes
and accepts service of process sufficient for personal jurisdiction in
any action against it as contemplated by this paragraph by registered
or certified mail, return receipt requested, postage prepaid, to its address
for the giving of notices as set forth in this Agreement. Any final judgement
rendered against a party in any action or proceeding shall be conclusive
as to the subject of such final judgement and may be enforced in other
jurisdictions in any manner provided by law. Jury Trial Waivers To the
fullest extent permitted by law, and as separately bargained-for-consideration,
each party hereby waives any right to trial by jury in any action, suit,
proceeding, or counterclaim of any kind arising out of or relating to
this Agreement. Specific Performance The parties acknowledge that it will
be impossible to measure in money the damage to them caused by any failure
to comply with the covenants set forth in Section , that each such covenant
is material, and that in the event of any such failure, the injured party
will not have an adequate remedy at law or in damages. Therefore, the
parties consent to the issuance of an injunction or the enforcement of
other equitable remedies against them at the suit of the other, without
bond or other security, to compel performance of all of the terms of Section
, and waive the defense of the availability of relief in damages. Representation
on Authority of Parties/Signatories Each person signing this Agreement
represents and warrants that he or she is duly authorized and has legal
capacity to execute and deliver this Agreement. Each party represents
and warrants to the other that the execution and delivery of the Agreement
and the performance of such party’s obligations hereunder have been
duly authorized and that the Agreement is a valid and legal agreement
binding on such party and enforceable in accordance with its terms. Force
Majeure No party shall be liable for any failure to perform its obligations
in connection with any action described in this Agreement, if such failure
results from any act of God, riot, war, civil unrest, flood, earthquake,
or other cause beyond such party’s reasonable control (including
any mechanical, electronic, or communications failure, but excluding failure
caused by a party’s financial condition or negligence). Assignment
Neither party shall voluntarily or by operation of law assign, hypothecate,
give, transfer, mortgage, sublet, license, or otherwise transfer or encumber
all or part of its rights, duties, or other interests in this Agreement
or the proceeds thereof (collectively, “Assignment’), without
the other party’s prior written consent. Any attempt to make an Assignment
in violation of this provision shall be a material default under this
Agreement and any Assignment in violation of this provision shall be null
and void. (u) Arbitration Any controversy, claim or dispute arising out
of or relating to this Agreement, shall be settled by binding arbitration
in [City], [State]. Such arbitration shall be conducted in accordance
with the then prevailing commercial arbitration rules of JAMS/Endispute
(“JAMS”), with the following exceptions if in conflict: (a)
one arbitrator shall be chosen by JAMS; (b) each party to the arbitration
will pay its pro rata share of the expenses and fees of the arbitrator,
together with other expenses of the arbitration incurred or approved by
the arbitrator; and (c) arbitration may proceed in the absence of any
party if written notice (pursuant to the JAMS’ rules and regulations)
of the proceedings has been given to such party. The parties agree to
abide by all decisions and awards rendered in such proceedings. Such decisions
and awards rendered by the arbitrator shall be final and conclusive and
may be entered in any court having jurisdiction thereof as a basis of
judgment and of the issuance of execution for its collection. All such
controversies, claims or disputes shall be settled in this manner in lieu
of any action at law or equity; provided however, that nothing in this
subsection shall be construed as precluding the bringing an action for
injunctive relief or other equitable relief. The arbitrator shall not
have the right to award punitive damages or speculative damages to either
party and shall not have the power to amend this Agreement. The arbitrator
shall be required to follow applicable law. IF FOR ANY REASON THIS ARBITRATION
CLAUSE BECOMES NOT APPLICABLE, THEN EACH PARTY, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL
BY JURY AS TO ANY ISSUE RELATING HERETO IN ANY ACTION, PROCEEDING, OR
COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER
MATTER INVOLVING THE PARTIES HERETO.The form is intended to give the company
a right of first refusal on the transfer or sale of stock held by a company
shareholder. All shareholders and spouses must sign the agreement. The
text in red and sections underlined in red indicate terms that will be
unique to the particular circumstance (e.g. names of companies). Disclaimer:The
viewing and use of this form, agreement or checklist is subject to AllBusiness'
Terms of Use agreement.RIGHT OF FIRST REFUSAL AGREEMENT [name of company]
This Right of First Refusal Agreement (this Agreement) is made on the
date written below, by and among [Name of Company], a California corporation
(the Company), and the parties listed as signatories hereto (the Holders).
In consideration of the mutual promises, covenants and conditions herein
contained and for other good and valuable consideration, the parties hereto
agree as follows: 1. Definitions Certain terms used herein are defined
as follows: (a) “Board of Directors” means the Board of Directors
of the Company and any committee thereof. (b) “Immediate Family”
means any spouse, child, grandchild, parent, brother, or sister of a Holder.
(c) “Shares” means any shares of capital stock of the Company
or any securities convertible into or exchangeable for any class of capital
stock of the Company and all securities into which such Shares may be
converted or reclassified as a result of any merger, consolidation, stock
split, stock dividend, or other recapitalization of the Company, whether
now owned or hereafter acquired. 2. Restrictions on Transfer No Holder
may sell or engage in any transaction which has resulted in or will result
in a change in the beneficial or record ownership of any Shares held by
the Holder, including without limitation a voluntary or involuntary sale,
assignment, transfer, pledge, hypothecation, encumbrance, disposal, loan,
gift, attachment or levy (a Transfer), except as provided in this Agreement,
and any such Transfer of Shares or attempted Transfer of Shares in contravention
of this Agreement shall be void and ineffective for any purpose or confer
on any transferee or purported transferee any rights whatsoever. 3. Right
of First Refusal (a) Each time a Holder proposes to Transfer (or is required
by operation of law or other involuntary transfer) any or all of the Shares
standing in such Holder's name or owned by him or her during the term
of this Agreement, such Holder shall first offer such Shares to the Company
in accordance with the following provisions: (i) Such Holder shall deliver
a written notice (a Notice) to the Company stating (A) such Holder's bona
fide intention to Transfer such Shares, (B) the name and the address of
the proposed transferee, (C) the number of Shares to be transferred, and
(D) the purchase price per Share and terms of payment for which the Holder
proposes to Transfer such Shares. (ii) Within 90 days after receipt of
the Notice, the Company or its designee shall have the first right to
purchase or obtain such Shares, upon the price and terms of payment designated
in the Notice. If the Notice provides for the payment of non-cash consideration,
the Company at its option may pay the consideration in cash equal to the
Company's good faith estimate of the present fair market value of the
non-cash consideration offered. Term of Agreement The restrictions on
Transfer of Shares set forth in this Agreement shall terminate upon any
of the following: (a) The determination of the Board of Directors that
this Agreement shall be terminated. (b) The dissolution or bankruptcy
of the Company. (c) The consummation of a public offering for any of the
common stock of the Company registered under the Securities Act of 1933,
as amended, on SEC Form S-1 or any successor form. (d) The following date.
Acknowledgments Each Holder acknowledges that other shareholders of the
Company may have restrictions on their shareholdings different than the
terms contained herein. 9. Further Assurances Each party hereto agrees
to perform any and all further acts and to execute and deliver any documents
which may reasonably be necessary to carry out the provisions of this
Agreement. 10. Modification This Agreement as applied to any Holder may
be amended at any time by the written agreement of the Company and a Holder
affected thereby. 11. Will Provisions Each Holder agrees to insert in
his or her will, or to execute a codicil thereto, directing and authorizing
his or her executor to fulfill and comply with the provisions hereof.
12. Notice Any notice required or permitted hereunder shall be delivered
in person or sent by telecopier, air courier or certified mail, return
receipt requested, postage and fees prepaid in all cases; in the case
of the Company, to the then current address of its then principal business
office, to the attention of the Chairman of its Board of Directors, and,
in the case of a Holder, to the address of such Holder shown on the signature
page hereto, or to such other address as will have been specified by prior
written notice to the sending party. Notice shall be effective upon delivery
if it is hand-delivered; upon receipt if it is transmitted by telecopier,
air courier or registered, certified or express mail; upon expiration
of the third business day after deposit in the United States mail if mailed
from and to an address in the United States; and upon expiration of the
tenth business day after deposit in the United States mail if mailed from
or to an address outside the United States. 13. Succession This Agreement
shall be binding upon and inure to the benefit of the parties hereto and
upon their permitted successors in interest of any kind whatsoever, their
heirs, executors, administrators, and personal representatives. 14. Governing
Law This Agreement will be governed in all respects by the laws of the
State of California as such laws are applied to agreements between California
residents entered into and to be performed entirely within California,
without regard to conflicts of law [principles]. The parties hereby consent
to the exclusive jurisdiction of the state or federal courts located in
the State of California, for the resolution of any disputes arising out
of this Agreement. 15. Counterparts This Agreement may be signed in any
number of counterparts, each of which will be an original, but all of
which together will constitute one and the same instrument. 16. Sole Agreement
This Agreement constitutes the entire agreement and understanding of the
parties hereto with respect to the subject matter hereof and supersedes
any and all prior or contemporaneous agreements and understandings pertaining
thereto whether oral or written. 17. Construction The titles of the sections
of this Agreement are for convenience of reference only and are not to
be considered in construing this Agreement. The language of this Agreement
shall be construed as to its fair meaning and not strictly for or against
any party. 18. Severability If one or more provisions of this Agreement
are held to be unenforceable under applicable law, such provision shall
be excluded from this Agreement and the balance of this Agreement shall
be enforceable in accordance with its terms and interpreted as if such
provisions were as excluded. 19. Attorney Fees In the event that any dispute
among the parties hereto should result in litigation or arbitration, the
prevailing party in such dispute shall be entitled to recover from the
other party all reasonable fees, costs and expenses of enforcing any right
of the prevailing party, including without limitation, reasonable attorneys'
fees and expenses. IN WITNESS WHEREOF, the parties have executed this
Agreement as of the date written below. Date: [NAME OF COMPANY] By: Title:
HOLDERS: Address: [Add signature lines as appropriate.] Consent of Spouse
The undersigned spouse(s) of the party (parties) to the foregoing Agreement
acknowledge(s) on his or her own behalf that: I have read the foregoing
Agreement and I know its contents. I am aware that by its provisions my
spouse grants the Company an option to purchase all of his or her shares
of the Company, including my community interest in them. I hereby consent
to the sale, approve of the provisions of the Agreement, and agree that
those shares and my interest in them are subject to the provisions of
the Agreement and that I will take no action at any time to hinder operation
of the Agreement on those shares or my interest in them.
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