Right Of First Offer

AAA

DEFINITION of 'Right Of First Offer'

A contractual obligation by the owner of an asset to a rights holder to negotiate the sale of an asset with the rights holder before offering the asset for sale to third parties. If the rights holder is not interested in purchasing the asset or cannot reach an agreement with the seller, the seller has no further obligation to the rights holder and may sell the asset freely.

INVESTOPEDIA EXPLAINS 'Right Of First Offer'

A right of first offer is related to a right of first refusal, but the former is considered to favor the seller while the latter is considered to favor the rights holder. Assets that have a right of first refusal attached to them can be more difficult to sell because potential buyers may not want to go to the trouble of negotiating a deal that must be offered to another party first.

RELATED TERMS
  1. Godfather Offer

    An irrefutable takeover offer made to a target company by an ...
  2. Rights

    A security giving stockholders entitlement to purchase new shares ...
  3. Right Of First Refusal

    A contractual right of an entity to be given the opportunity ...
  4. Rights Offering (Issue)

    An issue of rights to a company's existing shareholders that ...
  5. Open Offer

    A secondary market offering that is similar to a rights issue ...
  6. Gold IRA

    Definition of Gold IRA
Related Articles
  1. Tips For The Prospective Landlord
    Home & Auto

    Tips For The Prospective Landlord

  2. Simple Ways To Invest In Real Estate
    Home & Auto

    Simple Ways To Invest In Real Estate

  3. Avoid Capital Gains Tax On Your Home ...
    Taxes

    Avoid Capital Gains Tax On Your Home ...

  4. Find Fortune In Commercial Real Estate ...
    Entrepreneurship

    Find Fortune In Commercial Real Estate ...

comments powered by Disqus
Hot Definitions
  1. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  2. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  3. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  4. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
  5. Gresham's Law

    A monetary principle stating that "bad money drives out good." In currency valuation, Gresham's Law states that if a new ...
  6. Limit-On-Open Order - LOO

    A type of limit order to buy or sell shares at the market open if the market price meets the limit condition. This type of ...
Trading Center