Right of First Refusal refers to a provision in an agreement which states that a specified party should be given an opportunity prior to others to either accept or reject an offer.
The Right of Refusal is required at the time of property sale. If the owner decides to sell, he must hand over the property to the specified party. But if the party refuses, then it must be offered to others under similar terms and conditions.
Right of Refusal is also valid when a property is offered on lease. It is a clause that gives the tenant the first opportunity to lease additional space within a property. The space is offered at the same price, terms and conditions as those stated in a third party offer that the owner willingly accepts. If the lessee chooses to purchase or lease the premises after the First Refusal being granted, then it shall provide a notice for within a 60 day period.
An owner can exercise the [b:9d1cd213de]Right of Refusal [/b:9d1cd213de]only when he receives an offer of purchase the property. A First Right of Refusal is provided to the tenant occupying the property, but the owner may also give it to someone else. In order to activate the Right of Refusal, the buyer submits an offer to the owner that is acceptable for the purchase of the property. The owner then submits an offer to the individual who holds the First Right of Refusal to check if he will purchase the property at the same price and terms. If the person is not interested, then the owner will proceed to sell the property to the original buyer who submitted the offer.