Commercial Agreement Rights of First Refusal, First Offer, and First Negotiation

Summary

In certain commercial agreements, parties will want or need to set forth terms regarding their future rights and obligations with respect to an asset. Such terms can be used with respect to interests in real property; businesses, such as rights concerning ownership in corporations, partnerships, and LLCs; as well as any other conveyable interest in any other property, rights, or licenses. For example, a commercial tenant may want to expand its facilities in the future and have the right to lease additional space that becomes vacant in its building or, alternatively, have the option to purchase the property should the owner sell. Members of an LLC or company shareholders may want to create rights and obligations concerning the future transfer of interests in the entity, such as providing the other members or shareholders with the ability to purchase an existing member's shares before they can be sold to a third party.