| Commentary

26.1 General

| Commentary

26: OPTION

(For option clauses see Form 26.1 [1454] onwards.)

26.1 General

An option is a contractual right for one party (the option holder) to elect to bring into force a term of an agreement. Usually, the option will continue for a specified period, and it will be possible to exercise the option on pre-agreed terms, such as price, at a particular time and in compliance with certain formalities. For example, an option clause may grant the option holder a right to purchase land, to sell shares or to purchase or take a licence under a patent.

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