The term “overage” denotes an excess of something. This could pertain to an abundance of a particular product or item, such as an excessive amount of toys or clothing. Alternatively, it may refer to a percentage of money that a store pays to their landlord on top of their standard rent.
Overage is when there is an excess or surplus of goods or merchandise. It can also be a percentage of retail sales that a store must pay to the landlord on top of the fixed rent. For example, if a store orders too much inventory and can’t sell it, that is considered an overage. This can lead to financial losses for the store. Another example is when a lease agreement requires the tenant to pay a 5% overage on all retail sales in addition to the fixed rent. This increases the overall cost of operating the store.
Overage, also known as clawback or uplift, refers to a legal provision that allows a seller to receive additional payment from a buyer if certain conditions or events occur in the future, typically related to the development or increase in value of the property being sold.
Overage is applicable when the parties involved in a property transaction agree to include this provision in their contract. It is commonly used in situations where the seller believes that the property’s value may significantly increase in the future.
The conditions triggering the payment of overage are usually specified in the contract. Common triggers include obtaining planning permission, the sale of the property at a higher price, or the development of the property beyond a certain threshold.
The overage amount is typically calculated as a percentage of the increase in value of the property. The specific percentage is agreed upon by the parties involved and stated in the contract.
Yes, overage terms are negotiable between the buyer and seller. Both parties can discuss and agree upon the specific conditions, triggers, and percentage of overage that will apply to their transaction.
Yes, overage provisions are legally enforceable if they are properly drafted and included in a valid contract. However, it is advisable to seek legal advice and ensure that the overage clause is clear and unambiguous to avoid potential disputes.
Yes, the parties involved can choose to waive or exclude overage from their contract if they mutually agree to do so. This can be done by explicitly stating the exclusion in the contract or through a separate agreement.
Yes, overage provisions can be transferred to subsequent buyers if the original contract allows for it. This means that if the property is sold again in the future, the new buyer would also be bound by the overage terms.
Yes, overage payments may have tax implications for both the seller and the buyer. It is recommended to consult with a tax professional to understand the specific tax obligations and implications associated with overage payments.
Yes, overage provisions can be challenged or disputed if there are disagreements regarding the fulfillment of the specified conditions or the calculation of the overage amount. In such cases, legal advice should be sought to resolve the dispute through negotiation or, if necessary, through legal proceedings.
This site contains general legal information but does not constitute professional legal advice for your particular situation. Persuing this glossary does not create an attorney-client or legal adviser relationship. If you have specific questions, please consult a qualified attorney licensed in your jurisdiction.
This glossary post was last updated: 27th April 2024.
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