Purchase Option Clause full text

1. Purchase Option

1.1. The Lessee shall have the option to purchase the Leased Equipment (hereinafter referred to as the „Equipment”) from the Lessor during the Term of the Lease or upon its expiration, subject to the following conditions:

(a) The Lessee must not be in default of any material term of the present Lease Agreement at the time of exercising the purchase option.

(b) The Lessee must provide written notice of its intent to purchase the Equipment (the „Purchase Notice”) to the Lessor no later than sixty (60) days prior to the intended purchase date (the „Purchase Date”).

(c) The Equipment must not be encumbered by any third-party claims, liens, or security interests that would impede the transfer of title.

(d) The Equipment shall be sold on an „as-is, where-is” basis, without any warranties, express or implied, except those expressly stated in the present Agreement.

2. Purchase Price and Transfer of Title

2.1. The purchase price (the „Purchase Price”) for the Equipment shall be determined as follows:

(a) If the Purchase Option is exercised during the Term of the Lease, the Purchase Price shall equal the residual value of the Equipment as set forth in Schedule A, adjusted for depreciation, less any amounts already paid by the Lessee under the Lease that are specifically attributed to principal reduction.

(b) If the Purchase Option is exercised at the expiration of the Lease, the Purchase Price shall be:

(i) A fair market value (FMV) amount mutually agreed upon by the Parties at the time of purchase; or

(ii) If the Parties cannot agree on an FMV, the value determined by an independent appraiser jointly appointed by the Parties.

2.2. Upon payment of the Purchase Price in full, the Lessor shall transfer to the Lessee all rights, title, and interest in and to the Equipment, free and clear of any liens, encumbrances, or security interests, except those expressly created by the Lessee.