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Option to Purchase

Option to Purchase

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Published by Alberta Real Estate

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Published by: Alberta Real Estate on Mar 07, 2009
Copyright:Attribution Non-commercial


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Page 1Option to Purchase11/20/2008 19:54:47
ARTICLE --OPTION TO PURCHASEIt is further agreed for and in consideration of the mutual covenants andagreements contained herein, including the rental payments herein reserved, andthe additional valuable consideration in the sum of _____________, that anytime during the first year of the term of this Agreement and Lease, the Lesseeshall have the option to purchase the Premises and Property at the price of ___________, and during the second year, at the price of ___________. If theLessee elects to purchase the Premises and Property, he shall give writtennotice to the Lessor no less than _______ days prior to the expiration of thelease term, or intended purchase date, whichever first occurs in time,signifying his intentions.Lessor shall convey to Lessee, by bargain and sale deed without covenantsagainst grantor, good and marketable title to the Real Property and Premises,subject to all liens, encumbrances, encroachments, easements, rights of way(public or private), boundary agreements, covenants and restrictions of record;to any zoning ordinance or rules which may affect the Real Property andPremises; to any state of facts shown on an accurate survey of the RealProperty and Premises; and, to any condition which a reasonable inspection ofthe Real Property and Premises would reveal. Lessor shall deliver the fullyexecuted Deed to Lessee, and Lessee shall pay to Lessor the full purchase pricein certified funds, upon the date of closing herein set forth. Time is of theessence of this agreement of sale.In the event this option is exercised in accord herewith, Lessee may, atLessee's option, either pay the purchase price in full at time of closing, or,in the alternative, pay ______ percent of the purchase price in cash at thetime of closing and for the balance give to Lessor, Lessee's bond and mortgage,in form and content satisfactory to Lessor, repayable in equal quarter annualinstallments of principal and interest over a term of ______ years. Theinterest rate shall be equal to the so-called prime rate for preferredcommercial borrowers at ________ plus _________ and shall be subject toadjustment on each payment date only to reflect change, if any, in the so-called prime rate. Such mortgage shall be repayable in whole or in partwithout penalty and the payment of the balance shall hereupon be accelerated tothe extent that such prepayment amounts shall be applied to the last mortgagepayments, pro tanto.Lessee shall pay all transfer, sales, and mortgage taxes and recordingfees. Closing shall take place at ____________________ within _______ daysafter Lessee notifies Lessor of Lessee's election to exercise the within optionto purchase. Real property taxes, sewer and water rents, and other taxes of arecurring nature which are payable annually and shall have been paid by Lessor,shall be pro-rated between Lessor and Lessee as of the closing date of the taxyear during which the transfer occurs. Upon transfer of title, this Agreementand Lease shall cease and determine and the Lessor agrees to refund any prepaidrent and if the transfer of title takes place after the stated expiration date,this lease shall be extended on the same terms and conditions. This option andthe rights and privileges hereunder shall expire upon the termination of theterm of this lease, except for the closing of any transfer scheduled to takeplace after the termination of this lease.Without previous written consent of the Lessor first had and obtained,
Page 2Option to Purchase11/20/2008 19:54:47
neither the Lessee nor the Lessee's legal representatives or successors ininterest by operation of law or otherwise, shall assign this option.
Option to Purchase:Lessee shall have the option to purchase the premises upon ninety (90)days prior notice or in the event of destruction of the premises upon thirty(30) days notice during the initial Term or any renewals thereof for the thenapplicable price set forth in Exhibit ( ) attached hereto.In the event Lessee exercises its option to purchase, Lessee shallthereupon purchase from Lessor and Lessor shall sell and convey by grant deedto Lessee the premises in their then condition, free and clear of all liens,charges and encumbrances other than those which have been incurred by Lessee,if any there be, or imposed as a result of any obligation of Lessee, and otherthan current taxes not yet delinquent, and thereupon Lessee shall pay to Lessorthe entire and full consideration therefor.Rent and taxes shall be prorated as of the closing.Transfer taxes, recording fees on the deed, cost of title policy, chargesof escrow and all other closing costs shall be born equally between theparties.Lessor shall pay any real estate brokerage fees, if any, due upon theexercise of this option.
Purchase Option: Lessee shall have the option during the term of thislease, or any extension thereof, to purchase the Premises for the sum of ______ _________________________ dollars ($_________) payable on delivery of deed.This option shall be exercised by Lessee giving to the Lessor written notice ofits election to purchase. If prior to the exercise of this option, any portionof the Premises shall be taken by condemnation or eminent domain, this optionto purchase shall apply to the remaining portion of the Premises and theaforesaid purchase price shall be reduced by the amount of the award in thecondemnation proceedings.
Transfer of Title: In the event of the exercise of an option to purchaseunder Paragraph(s) ( ) conveyance of a good and merchantable title to thePremises shall be made by the Lessor to the Lessee, or its nominee, by aGeneral Warranty Deed, recordable in form, bearing required transfer or taxstamp, free and clear of all liens and encumbrances; and the purchase priceshall be paid to the Lessor on delivery of the deed. Promptly upon notice ofthe exercise of the option, Lessor shall furnish to Lessee a down-to-dateabstract of title or a prepaid title insurance binder and title report of atitle company acceptable to Lessee in the amount of the purchase price showinga good and merchantable title in Lessor or thereafter promptly cured by Lessorto show such title; Lessee shall have a reasonable time to examine the titlereport submitted and title meeting the requirements hereof or otherwise foundto be acceptable to Lessee. Current taxes and rent for the month in which thesale and purchase is completed shall be apportioned to the date of closing.In the event of the exercise of the option to lease under Paragraph ( ),

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