Commentary

26.4 Right of first refusal distinguished from option

BOILERPLATE AND COMMERCIAL CLAUSES vol 4(3)

26.4 Right of first refusal distinguished from option

26.4 Right of first refusal distinguished from option

Options are sometimes confused with rights of first refusal. A right of first refusal is exercisable only if the grantor of the right elects to make the right available, but once available, it is the right to obtain the subject of that right or to enter a contract, depending on the nature of the right. Usually, this means that1:

  1. (a)

        if the grantor asks a third party to make an offer for the subject matter of the right, then the recipient of the right has the opportunity to match any offer that

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