Option to purchase

An option to purchase is a contractual right for a charterer or third party to buy the vessel at a fixed price or formula during a stated window. It is common in bareboat charters and finance leases, where it lets the charterer take title at the end of the term or at set break points, often for a nominal sum on a hire-purchase structure. The option is construed strictly: the holder must give notice within the declaration period and on exact terms. On exercise the sale completes under a memorandum of agreement and a bill of sale passes title.