If you want to assign it, then an Amendment would have to be done that the seller signs that acknowledges the assignment. 

Treat it as a business deal with signed agreements, clear expectations, acknowledgements of risk, etc.Business deals gone bad really suck. 

Seems like the purchase price should be somewhere between the actual and the proforma, acknowledging that improvements MIGHT increase the value to some unknown degree but certainly not a guarantee. 

Be as informed as you possibly can be when you take on your first deal, acknowledge the risk, trust your preparation, and just make the first leap.

I re-read the signed counter offer and it states: "Buyer acknowledges lease in place with blah blah LLC". 

I acknowledged that very clearly. 

The sales contract has my name on it, therefore I am explicitly acknowledging the existence of a lease and agreeing to inherit it (or explicitly refusing to).

Sellers acknowledge the risk as part of the contract.

@Matthew Jure There are two general ways to insure your property.Since you are living in your double you can insure it as owner occupied (with some companies) as long as you acknowledge it is a duplex.

The deposit also should have been transferred to you on sale.At the transfer of rental property it is helpful to get something called and estoppel agreement from the tenant with key points on the lease including acknowledgement of deposit.