WeConservePA has updated its guide, “Option to Sell (Put Option).”
The holder of an option to sell (sometimes called a “put” or “put option”) has the right, but not the obligation, to sell a specified property interest to the grantor of the put option at a certain price within a certain period of time. The grantor of the put option has the obligation to purchase the property interest if the holder exercises the option. The option holder typically will have sought the put option at the time they acquired the property to ensure that they can undo the acquisition if their expectations regarding funding or other matters related to the acquired property are not met.
Described in this guide are three situations in which a put option could be an appropriate tool:
- Temporary accommodation;
- Ensuring project participation; and,
- Unwinding a collaboration.