Option And Purchase Agreement Template for Philippines

The Option And Purchase Agreement is a crucial document in Philippine business and property transactions, providing a structured framework for potential property acquisitions while managing risk for both parties. It is commonly used when a buyer needs time to arrange financing, conduct due diligence, or secure necessary approvals before committing to a purchase, while the seller wants assurance of a serious buyer through an option fee. The agreement must comply with Philippine Civil Code requirements, property laws, and local regulations, including proper notarization and registration procedures. It typically includes detailed provisions about the option period, purchase price, payment terms, property description, and conditions for exercise, making it particularly valuable in complex commercial transactions where parties need flexibility and legal certainty.

1. Parties: Identification of the option grantor and option holder, including complete legal names, addresses, and registration details if applicable

2. Background: Context of the agreement, including brief description of the property/asset and the parties' intention to enter into an option arrangement

3. Definitions: Key terms used throughout the agreement, including 'Option Period', 'Strike Price', 'Property', 'Completion Date', etc.

4. Grant of Option: Core provision detailing the grant of the option, including exclusivity and non-transferability terms

5. Option Period: Duration of the option, including start and end dates, and any extension mechanisms

6. Option Price: Amount payable for the option itself, payment terms, and whether it's credited towards the purchase price

7. Exercise of Option: Process and formalities for exercising the option, including notice requirements

8. Purchase Price: Total consideration for the purchase if option is exercised, payment terms and methods

9. Completion: Process and requirements for completing the purchase after option exercise

10. Representations and Warranties: Standard declarations by both parties regarding their capacity, authority, and property condition

11. Termination: Circumstances under which the agreement can be terminated and consequences

12. Governing Law and Jurisdiction: Specification of Philippine law as governing law and jurisdiction for disputes

13. General Provisions: Standard boilerplate clauses including notices, entire agreement, amendments, etc.