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What is the right of first refusal (ROFR)? What triggers a right of first refusal? Download this Right of First Refusal to Purchase (ROFR) now!

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What is the right of first refusal (ROFR)? What triggers a right of first refusal?

Having the first right of refusal (ROFR) on a property, business, or any other object is often of great value to the holder. The right of first refusal is a contractual condition or right that gives the holder the option to enter a business transaction with the owner of something, according to the specified terms, before the owner is entitled to enter that transaction with another (third) party. 

A ROFR can cover for example an asset, including real estate, personal property, a patent or license, a play, or an interest in a business. If the Grantee shall have given an Intent to Buy, the Grantee shall purchase Offered Goods referred to in the Offer; Or if the Grantee shall not have given an Intent to Buy within the time provided, then the Grantee shall be deemed for all purposes to have refused to purchase the Offered Goods; and in the event that each Grantee elects not to purchase or is deemed to have refused to purchase the Offered Goods, then the Owner may accept the Offer and proceed to sell the Offered Goods, but only at …

It might also cover transactions that are not strictly assets, but for example, rights to enter a joint venture or distribution arrangement. In real estate, a right of first refusal would create a situation for a tenant to take better care of their leased apartment in case the opportunity to purchase arises in the future. Only if the holder turns it down may the owner, then shop it around to other parties.

Right of First Refusal to Purchase (ROFR) clause:
This Right of First Refusal (ROFR) covers the most important clauses and will help you to structure and communicate in a professional way with parties involved:

  1. Parties
  2. General
  3. Owner
  4. Grantee
  5. Offer
  6. Payment
  7. Intent to Purchase
  8. Effective Date
  9. Grant of Rights
  10. No Waiver
  11. Notices
  12. Entirety of Agreement
  13. Governing Law
  14. Severability
  15. Signatures

This ROFR template is provided to provide a professional document to assist you in its preparation. This Agreement template can also be appended to other agreements or signed contemporaneously with them at the same closing. Be sure to have multiple copies, at least one for each signatory, and to keep stored where you save documents related to the subject, 

In negotiations, you should be able to exact a higher price for any transaction that involves a Right of First Refusal. While often it is desired defensively by the acquirer, it ties your hands and potentially can disrupt the sale of the goods or property in question. Our trustworthy legal templates are all crafted and screened by professionals. The 3-step process virtually guarantees you can modify, finish, and print your legal document in a short time!

Download this professional Right of First Refusal to Purchase template if you find yourself in this situation and save yourself time, effort and probably reduce some of the lawyer fees! 

Using our legal templates will help you to reach the next level of success in your education, work, and business! However, we still recommend you consider consulting a local law firm in case of doubt to support you in this matter. 

Also interested in other Legal templates? Just search on our website and have instant access to thousands of free and premium legal agreements, contracts, documents, forms, letters, etc., which are used by professionals in your industry.

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