Hello again --
I am sorry to hear that the transaction fell through and you are no longer interested in an in depth contract review. However, I did take a quick look at the documents and you can use these comments for future reference if need be --- as follows:
A. Default Provisions: They have the ability to declare a default for any reason or no reason. It appears several times in the contract and in normal contracts all throughout the construction
and renovation industry, the reasons to be able to declare a default are generally listed with SOME specificity -- and there is also a provision added that Acts of God (storms, weather delays) are beyond your control as well as the acts of any unknown third parties (vandalism, etc).. Finally, you as the Optionor should be given a right to declare a default if the investor defaults on payments or anything else.
B. Opportunity to Cure: Your company should be given a written notice of what they are declaring to be a "default" and an opportunity to cure that default before a foreclosure can take place. The way the provision appears now, they can declare a default for any tiny reason and move to a foreclosure immediately without any chance for you to cure the default or protest against the default in court.
C. Liquidated Damages
-- If they choose the Liquidated damages provision as "applicable" then they are entitled to every penny returned to them, including all costs and expenses incurred (in addition to their investment) AND an additional cash payment ?? This provision is not fair in the least, because once they choose the Liquidated Damages option that completely cuts off any right you have to mediate or arbitrate pursuant to the contract and you cannot take the matter to court. If they choose LD then it is pretty much all over for your company and you are stuck holding the bag. There should be a provision in here that you are entitled to at LEAST any costs and attorney's fees that you incur as a result of their default. Period.
D. Costs -- Should all be split 50/50 unless either party causes the default in which case, that party is responsible for the costs of foreclosure and attorney's fees. That is how this should be written.
If these comments do not help now, I hope that you can use them for any future ventures that you might get involved with. Please let me know if you have any follow up questions. If not, can you please press a positive rating in the ratings section so I will receive credit for assisting you in the question and answer session. I do not receive credit unless you press a positive rating before leaving the website. THANK YOU VERY MUCH !!