First Refusal Right

### What does the right of first refusal (ROFR) grant the holder? - [x] The opportunity to engage in a transaction before third parties. - [ ] The right to first offer on a neighbor's property. - [ ] Unlimited access to the property. - [ ] Permission to alter the terms of any third-party offer. > **Explanation:** The Right of First Refusal gives the holder the chance to enter a transaction (such as buying or leasing the property) before the owner can proceed with third parties. ### Who typically has the first refusal right in a commercial property lease? - [ ] The landlord - [x] The tenant - [ ] The property manager - [ ] The local government > **Explanation:** In commercial real estate, tenants frequently hold the ROFR, allowing them to purchase the property before it is offered to others if the landlord decides to sell. ### How can a First Refusal Right impact the ease of selling a property? - [x] It may limit the number of potential third-party buyers. - [ ] It guarantees a quicker sale. - [ ] It increases the property's market price. - [ ] It attracts more investors. > **Explanation:** A First Refusal Right can potentially limit the property's attractiveness to third-party buyers since the holder has the initial opportunity to accept or reject the offer. ### Can a First Refusal Right duration be specified in months or years? - [x] Yes, it is defined in the contract. - [ ] No, it lasts indefinitely. - [ ] It depends on the type of property. - [ ] Only when mutually agreed upon during renewal. > **Explanation:** The specific period during which a First Refusal Right exists is detailed in the contract; it varies based on the agreement. ### In which scenario is a First Refusal Right commonly used within families? - [ ] Court-decision properties - [x] Family-owned properties - [ ] Securities - [ ] Shares of companies > **Explanation:** A First Refusal Right within family-owned properties allows family members to purchase the property before it is sold to an outside party. ### What is the main purpose of having a Right of First Refusal clause in a sales agreement? - [ ] To increase market competition - [x] To give a preferred party the opportunity to match an offer - [ ] To impose additional taxes on the sale - [ ] To hinder the property owner's ability to sell > **Explanation:** The main intent of an ROFR clause is to provide a specific party (like a tenant or a favored buyer) the chance to match the terms of a pending offer before it is offered to others. ### Does ROFR include altering or rejecting proposed third-party offers? - [ ] Yes, the holder can reject offers indefinitely. - [ ] Yes, the holder can change the offer terms. - [x] No, the holder must match the offer terms or pass. - [ ] No, the holder has outright priority with no comparisons. > **Explanation:** A holder of an ROFR must either match the terms of a proposed third-party offer or let the owner proceed with that third-party. ### What type of document typically contains a Right of First Refusal clause? - [ ] JanaP1994 vehicle contracts - [x] Real estate contracts - [ ] Personal loans documentation - [ ] School enrollments > **Explanation:** Real estate contracts often encapsulate a ROFR clause, imposing a condition to provide the holder the primary opportunity on property transactions. ### Is a Right of First Refusal only valid if included within a written contract? - [x] Yes, it needs to be documented. - [ ] No, it can be verbally agreed. - [ ] Not necessary if parties trust one another. - [ ] Only if stated so by one party. > **Explanation:** For a Right of First Refusal to be enforceable, it must be included in a documented contract, outlining specific terms and conditions. ### Who can legally enforce a Right of First Refusal? - [ ] Local courts by default - [x] The holder of the contractual right - [ ] Any family member or friend of the buyer - [ ] Any alleged beneficiary > **Explanation:** The holder who is explicitly provided a Right of First Refusal within a valid contract has the legal right to enforce it over others.