Right of First Refusal (ROFR) Agreement

A Right of First Refusal (ROFR) Agreement is a legal contract that gives a specific party the option to enter a business transaction before anyone else. Key aspects include:

1. Grants the right holder first opportunity to:

   – Purchase an asset

   – Enter into a business deal

   – Match any offer made by a third party

2. Typically used in real estate, business sales, or shareholder agreements

3. Specifies terms such as:

   – Time frame for exercising the right

   – Conditions triggering the ROFR

   – Pricing mechanisms

4. Binding on the property owner or selling party

5. Does not obligate the right holder to make a purchase

This agreement provides a level of control and protection for the right holder while potentially limiting the seller’s options. It’s commonly used to maintain business relationships, protect investments, or keep property within a specific group. While beneficial for the right holder, it can sometimes make properties less attractive to outside buyers. Careful drafting is essential to balance the interests of all parties and avoid potential disputes.