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The Option Agreement (Real Estate) is a crucial document in Philippine real estate transactions, commonly used when a potential buyer needs time to evaluate a property or secure financing before committing to a purchase. This agreement type is governed by Philippine civil law and property regulations, requiring specific formalities including notarization and potential registration with the Register of Deeds. It protects both the property owner's interests by securing a potential sale and the buyer's interests by reserving the property for a specified period. The agreement typically includes essential details such as the option price, exercise period, purchase price, property description, and conditions for exercise, making it particularly valuable in commercial real estate transactions, property development projects, and investment deals where careful due diligence is necessary before commitment.

1. Parties: Identification of the Option Grantor (property owner) and Option Holder, including complete legal names and addresses

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

3. Definitions: Key terms used throughout the agreement, including 'Option Period', 'Option Price', 'Purchase Price', and 'Property'

4. Grant of Option: Express grant of the exclusive right to purchase the property within the specified period

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

6. Option Price and Payment: Amount payable for the option right and payment terms, including whether it's applicable to the purchase price

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

8. Purchase Price: Agreed purchase price for the property if the option is exercised

9. Title and Documentation: Requirements regarding clear title, required documentation, and title investigation rights

10. Representations and Warranties: Standard representations about property ownership, authority to sell, and property condition

11. Closing Provisions: Requirements and timeline for closing after option exercise

12. Default and Remedies: Consequences of default by either party and available remedies

13. General Provisions: Standard clauses including governing law, notices, assignment, and entire agreement