rights of first offer

rights of first offer
USA
This requires an equity holder in a company (such as a stockholder or a member) to offer to sell its equity to the other holders before offering to sell to third parties. If the other holders do not buy such offered equity, the selling holder usually has a limited period of time to sell to a third party, but that sale must be on terms no more favorable than those offered to the other holders.
Sometimes the equity holders are given a right of first offer in connection with new equity issuances by the company itself. See also pre-emptive rights.
Related links

Practical Law Dictionary. Glossary of UK, US and international legal terms. . 2010.

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