Option Contract to Purchase Real Property - Form Pro · PH-law

OPTION CONTRACT

KNOW ALL MEN BY THESE PRESENTS:

This Option Contract (the "AGREEMENT") is made and executed at the City/Municipality of ________, Province of ________, this ________, by and between:

________, Filipino, of legal age, with civil status of ________, and with residence and postal address at ________, hereinafter referred to as the "SELLER";

-and-

________, Filipino, of legal age, with civil status of ________, and with residence and postal address at ________, hereinafter referred to as the "BUYER";

(the SELLER and the BUYER are hereinafter collectively referred to as the "PARTIES" and individually as a "PARTY").

WITNESSETH: That —

WHEREAS, the SELLER represents and warrants that he/she is the absolute and registered owner, free from all liens and encumbrances, of the following real property:

A parcel of land situated at ________, covered by Transfer Certificate of Title No. ________ issued by the Registry of Deeds of ________, with Tax Declaration No. ________, containing an area of ________ square meters, more or less, and more particularly described as follows:

________ (the "PROPERTY");

WHEREAS, the BUYER has offered to acquire the PROPERTY, and the SELLER has agreed to grant unto the BUYER the exclusive and irrevocable right and privilege to purchase the PROPERTY within the period and at the price hereinafter set forth, in accordance with Article 1479 and related provisions of the Civil Code of the Philippines (Republic Act No. 386);

NOW THEREFORE, for and in consideration of the foregoing premises and the mutual covenants hereinafter contained, the PARTIES hereby agree as follows:

§ 1. Grant and Exercise of Option. The SELLER hereby grants unto the BUYER the exclusive and irrevocable right and option to purchase the PROPERTY, which the BUYER may exercise within ________ following the date of execution of this AGREEMENT by the PARTIES (the "PERIOD"). The option shall be deemed exercised upon the BUYER giving written notice thereof to the SELLER within the PERIOD, whereupon the PARTIES shall, within ________ days from such notice, execute a Contract to Sell or a Deed of Absolute Sale to effect the purchase of the PROPERTY.

§ 2. Option Money. In consideration of the grant of the option herein, the BUYER shall pay to the SELLER the sum of ________ (₱________) (the "OPTION MONEY"). It is expressly agreed that the OPTION MONEY shall form part of, and shall be deducted from, the total purchase price of the PROPERTY in the event the BUYER exercises the option within the PERIOD.

§ 3. Payment of Option Money. The OPTION MONEY shall be paid by the BUYER to the SELLER upon the execution of this AGREEMENT, by depositing or remitting the amount to the following account:

Account number: ________
Account name: ________
Bank/E-wallet: ________

§ 4. Purchase Price. The PARTIES agree that, should the BUYER exercise the option to purchase the PROPERTY within the PERIOD, the PROPERTY shall be sold at the rate of ________ (₱________) per square meter, for an aggregate purchase price of ________ (₱________).

§ 5. Taxes and Expenses. Unless otherwise agreed in the subsequent Contract to Sell or Deed of Absolute Sale, the capital gains tax and documentary stamp tax, transfer tax, registration fees, and other costs incident to the sale and transfer of the PROPERTY shall be borne by the PARTIES in accordance with the National Internal Revenue Code, as amended, and prevailing law and practice.

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§ 7. Nature and Interpretation. This AGREEMENT shall not be construed or interpreted as a Contract to Sell or a Deed of Absolute Sale between the PARTIES. The OPTION MONEY shall not be deemed or considered as earnest money within the meaning of Article 1482 of the Civil Code, notwithstanding the agreement that the same shall form part of the purchase price upon exercise of the option.

§ 8. Warranties of the SELLER. The SELLER warrants that he/she has full legal capacity and authority to grant this option; that he/she is the lawful and registered owner of the PROPERTY; and that the PROPERTY is free and clear of all liens, encumbrances, claims, and adverse interests of any kind, except as may be expressly disclosed herein.

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§ 10. Applicable Law and Venue. This AGREEMENT shall be governed by and construed in accordance with the laws of the Republic of the Philippines. Any action or proceeding arising out of or in connection with this AGREEMENT shall be brought exclusively before the proper courts of ________, to the exclusion of all other venues.

§ 11. Severability. The invalidity of any provision of this AGREEMENT shall not affect the validity of the remaining provisions. Should any provision be held invalid or unenforceable, the remaining provisions shall continue in full force and effect as if the invalid provision had been omitted.

§ 12. Amendments and Modifications. This AGREEMENT may be amended or modified only by a written instrument duly signed by both PARTIES.

IN WITNESS WHEREOF, the PARTIES have hereunto affixed their signatures on the date and at the place first above written.

________
Seller

________
Buyer

SIGNED IN THE PRESENCE OF:

________        ________

ACKNOWLEDGMENT

Republic of the Philippines
Province of ________ )
City or Municipality of ________ ) S.S.

BEFORE ME, a Notary Public for and in the City or Municipality of ________, ________, this ________ day of ________, 20________, personally appeared the following persons:

1. ________, with competent evidence of identity consisting of Driver's License with number ________, which expires on ________;

2. ________, with competent evidence of identity consisting of Driver's License with number ________, which expires on ________.

All known to me and to me known to be the same persons who executed the foregoing OPTION CONTRACT, and they acknowledged to me that the same is their free and voluntary act and deed.

This instrument, consisting of ________ pages, including the page on which this Acknowledgment is written, has been signed on each and every page thereof by the PARTIES and their witnesses, and sealed with my notarial seal.

IN TESTIMONY WHEREOF, I have hereunto set my hand and affixed my notarial seal on the date and at the place above written.

________
Notary Public

Doc. No. ________;
Page No. ________;
Book No. ________;
Series of ________.