Contract Glossary
Right of First Refusal
Definition
A contractual right that gives one party the first opportunity to buy or lease something before the owner can sell or lease it to someone else. The right-holder gets to match (or refuse) the best offer the owner receives.
In Practice
If your commercial lease includes a right of first refusal on the adjacent unit, and another tenant offers $5,000/month for it, the landlord must let you match that offer before accepting it. In startup shareholder agreements, ROFR provisions let existing investors buy shares before the founder sells to an outsider.
Common in these contract types
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