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Right of First Refusal Agreement

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Right of First Refusal Agreement Powered By Docstoc
					This is an agreement that grants its holder the right to accept or decline an offer for
certain property before it can be offered to third parties. The holder does not have an
obligation to accept the offer, they simply have the right to be the first party that gets the
opportunity to enter into the specific transaction. This agreement defines the property
subject to the agreement as well as providing the holder with a grace period when they
can accept or decline the offer. This agreement can be used by small businesses or
other entities that want to have the option to enter into a business transaction before it is
offered to the general public.
               RIGHT OF FIRST REFUSAL AGREEMENT
THIS RIGHT OF FIRST REFUSAL AGREEMENT is entered into as of the _________ day of
____________, _____ (the “Effective Date”) by and between __________________________
(the “Property Holder”) and         ___________________________________________ (the
“Company”), with reference to the following facts:

                                         RECITALS:

WHEREAS: Property Holder owns certain property (the “Property”) and has agreed to provide
the Company with this Right of First Refusal to purchase the Property;

NOW, THEREFORE, in consideration of the mutual covenants, warranties and representations
contained herein, the parties hereby agree as follows:

1.00          THIRD PARTY OFFER

1.01         No sale by Property Holder of any of the Property to any Person other than to the
Company shall be affected except in compliance with this Agreement.

1.02           If Property Holder receives a bona fide written offer (a “Third Party Offer”) from
any person (the “Buyer”) dealing at arm's length to purchase any of the Property owned by
Property Holder (the “Purchased Shares”), which Third Party Offer is acceptable to Property
Holder, then Property Holder shall, by notice in writing to the Company, make an offer (the
“Offer”) to sell the Property to the Company at the same price and upon the same terms and
conditions as are contained in the Third Party Offer.

1.03          The Offer shall:

              (i)     identify in reasonable detail the Buyer and, if the Buyer is not an
                      individual, identify those Persons who, together with their Associates and
                      Affiliates, control the Buyer;

              (ii)    be accompanied by a true copy of the Third Party Offer setting forth all of
                      the terms and conditions of the Third Party Offer;

              (iii)   provide such information concerning the business experience and
                      expertise of the Buyer and its financial condition as is reasonably
                      available to Property Holder; and

              (iv)    the Offer shall not be revocable except with the consent of Property
                      Holder.

1.04           The Company shall have a period of ___________ (____) days from the date the
Offer is received by the Company (the "Offer Period”) to accept the Offer. Acceptance of the
Offer shall be made in writing (the ”Notice of Acceptance”), and the Company shall deliver a
Notice of Acceptance of such Offer and shall state therein whether the Company:
                  (i)       accepts the Offer on the condition that it is able to purchase all of the
                            Property; or

                  (ii)      accepts the Offer on the condition that it is able to purchase an equal
                            portion of the Property.

1.05           Notwithstanding the provisions of this Agreement which restrict the disposition of
or dealing with the Property. Property Holder shall at any time or from time to time have the
right, without the approval of the Company, to dispose of all or any of the Property to a
Permitted Transferee, provided that at the time of such disposition:

                  (i)       Such Permitted Transferee shall agree with Property Holder in writing and
                            in form and substance satisfactory to Property Holder, acting reasonably,
                            to assume and be bound by all of the terms and obligations contained in
                            this Agreement as if such Permitted Transferee had entered into this
                            Agreement in the place and stead of Property Holder.

                  (ii)      The Permitted Transferee agrees to remain a Permitted Transferee of
                            Property Holder for so long as the Permitted Transferee holds the
                            Property.

                  (iii)     The Company shall receive, in form and substance satisfactory to it, acting
                            reasonably, evidence that the Permitted Transferee is a Permitted
                            Transferee of Property Holder and that the Agreements referred to in
                            Sections 1.05 are legal, valid and binding obligations of the Permitted
                            Transferee.

1.06              For the purposes of this section, “Permitted Transferee” means:

                  (i)       a trust of which Property Holder or his/her spouse and/or issue are the
                            sole beneficiaries, provided that such trust is        a resident of
                            _______________;

                  (ii)      the spouse or issue of Property Holder , provided such spouse or issue, as
                            the case may be, is then a resident of _________________; or

                  (iii)     a Company of which Property Holder is the sole and registered beneficial
                            shareholder.

2.00              ACCEPTANCE OF OFFER

2.01            If the Offer is accepted by the Company within the Offer Period, Property Holder
shall sell and the Company shall purchase the Property upon the terms and conditions contained
in the Offer. In such case, the Com
				
DOCUMENT INFO
Description: This is an agreement that grants its holder the right to accept or decline an offer for certain property before it can be offered to third parties. The holder does not have an obligation to accept the offer, they simply have the right to be the first party that gets the opportunity to enter into the specific transaction. This agreement defines the property subject to the agreement as well as providing the holder with a grace period when they can accept or decline the offer. This agreement can be used by small businesses or other entities that want to have the option to enter into a business transaction before it is offered to the general public.
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