A contractual obligation between an owner of an asset and a rights holder, in which the first will offer the asset for sale primarily to the latter, before offering it to third parties. If the rights holder do not want to purchase the asset or unable to agree with the seller about the deal itself, the seller can sell the asset to anyone without any further obligation to the rights holder. For example: Yossi is the owner of an asset, and Moshe has the right of first offer for the same asset. If Yossi will decide he wants to sale the assets, Moshe will be the first one to make an offer in order to purchase the asset. However, If the parties can’t agree over the deal Yossi can go and offer the asset to third parties.
What is the “Right of first offer?”
About the Author: Karin Maimon
Third year Law & Business (Accounting) student at the IDC Herzliya. Dreams of becoming an owner of a VC company that will connect between different markets around the world, focusing on innovation and technology.