What's the exact language in the agreement? is it a "Right of First Refusal" ? Something else?
Without pasting in the entire two pages, this sums up how locked down the language is:
""" “Transfer” shall mean with respect to any security, the direct or indirect assignment, sale, transfer, tender, pledge, hypothecation, or the grant, creation or suffrage of a lien or encumbrance in or upon, or the gift, placement in trust, or the Constructive Sale (as such term is defined below) or other disposition of such security (including transfer by testamentary or intestate succession, merger or otherwise by operation of law) or any right, title or interest therein (including, but not limited to, any right or power to vote to which the holder thereof may be entitled, whether such right or power is granted by proxy or otherwise), or the record or beneficial ownership thereof, the offer to make such a sale, transfer, Constructive Sale or other disposition, and each agreement, arrangement or understanding, whether or not in writing, to effect any of the foregoing. "Constructive Sale" shall mean, with respect to any security, a short sale with respect to such security, entering into or acquiring an offsetting derivative contract with respect to such security, entering into or acquiring a futures or forward contract to deliver such security, or entering into any other hedging or other derivative transaction that has the effect of materially changing the economic benefits and risks of ownership. Any purported Transfer of any shares of the corporation's stock effected in violation of this section shall be null and void and shall have no force or effect and the corporation shall not register any such purported Transfer. """
So what are the rules of the section? The definition is not the rules.
There are some exceptions like passing it on to your heirs when you die or if the company IPOs.
So, who at the corporation did you actually get a refusal from? Did you manage to get a resolution in front of the board somehow?
After talking to several credible people, apparently forward sales are not uncommon even though they do violate the contract. The reason being that (1) the company doesnt have to know about it so (2) they don't need to revalue the company and (3) its not going to be widely available to employees so they can start slacking off. Also (4) they say that a company has never sued an employee over this kind of this and probably will never because it would look bad for the company to sue their own early employee.
So I'm just wondering: who are these people and are they willing to talk about the experience? I'm told that these deals do happen.
The company has no mechanism for determining that a person has entered into a contract unless someone tells them. Prohibitions on transfers prevent the cap sheet from growing, and the company from getting marked to market when they don't want to. Also makes it easier to create golden handcuffs.
There is always a nonzero chance that the deal falls through because the you are the first to get sued and lose their shares. If it were me, I'd want the contract to eliminate my liability in that scenario. If it were to happen, the buyer would very likely litigate on their own behalf rather than lose the shares that they paid for. These contracts are much more of a negotiation than a straightforward asset purchase on a stock exchange.
Tl;dr the options agreement is a private contract and so is the forward sale. If you're going to enter a forward contract and take hundreds of thousands or millions of dollars, you need a competent lawyer to scrutinize the contract and limit your downside liability. Then it's up to you and the buyer if the risk/reward is worth it.
You have a buyer. You present to the company that you have a buyer (eg, contract + check deposited in escrow).
The company either has to buy the equity from you (at same or better price, depending on how the contract is written) or they have to let the sale to the other buyer go through.