Holder of Unsold Shares

Definition

A holder of unsold shares is an investor who purchased multiple unsold units directly from the original sponsor (developer) of a NY cooperative. Per the offering plan, the holder typically inherits the sponsor's reserved rights: the right to sublet without board approval, the right to resell without board approval, and other special privileges. This designation has significant economic value because it strips away the restrictions that bind regular shareholders. The holder-of-unsold-shares status generally does NOT automatically transfer to a subsequent buyer — successor designation requires explicit transfer per the offering plan terms.