Lease with Option to Purchase

LEASE WITH OPTION TO PURCHASE

The purpose of this agreement is to allow for the lease of a domain name over time with an option to purchase at the end.

This agreement includes a couple interesting provisions that might be necessary for you, including:

  1. The Lessor holds the domain name ownership (no escrow), and
  2. The Lessor and Lessee agree to how many payments and what monthly fee.

Notes and Considerations

  • A 10% upfront fee is customary, but can be as low as 5% or as high as 20-25%.
  • A modest lease fee every month for up to 24 months can be anywhere from 0.5% to 2%, with 1% being customary.
  • At the conclusion of the lease term or at any time prior to the conclusion of the lease term, an option exists to pay the remainder of the purchase price, minus the amounts already paid, to take ownership of the domain name.
  • If Lessee can’t pay the remainder at the end of the lease then the domain returns to Lessor and any monies paid remain with Lessor.
  • Usually, the buyer has the negotiating power to specify the governing law (section 14), but you can always start the negotiation (and fill in on the agreement) with your preference.
  • DO NOT allow your attorney to spend the time writing an escrow agreement as escrow services like Escrow.com won’t sign them and are not setup to include review and inclusion of terms besides their own.

Template

Right click icon and select “Save As…” or “Save Link As…” to save the file to your local computer. Then customize to your specific deal information.

Be sure to rename the file to [domain]-Domain-Name-Lease-Agreement-Option-to-Purchase so you can keep a digital record and use it as a starting point for future transactions. And print-to or save-as PDF before sending it to the other party so they can’t change the terms of the agreement without your knowledge.

Replace all content in [square brackets] with real information from your transaction. Find or Search for [ to ensure you replaced all of them. Print it and read it before emailing it to the other party.