An addendum is a thing to be added; an addition. For example, it may be used to add supplemental terms or conditions to a contract or make corrections or supply omissions to a document. An addendum is often used to supply additional terms to standardized contracts, such as leases. Addendum is singular; the plural form is addenda.
A North Dakota Price Escalation Addendum to Agreement of Sale is a legal document that outlines the terms and conditions regarding the escalation of the purchase price of a property. This addendum is used when the parties involved in a real estate transaction want to establish a mechanism for adjusting the sale price if certain predefined conditions are met. In North Dakota, there are several types of Price Escalation Addendums to Agreement of Sale that can be used, such as: 1. Fixed Escalation Addendum: This type of addendum specifies a fixed percentage or amount by which the purchase price will increase if the predefined conditions are met. For example, the addendum may state that the price will increase by 3% if there is a competing offer that exceeds the initial offer by a certain threshold. 2. Percentage of Difference Addendum: This addendum calculates the increase in the purchase price based on the percentage difference between the initial offer and the competing offer. For instance, if a competing offer is 5% higher than the initial offer, the purchase price will be adjusted accordingly. 3. Appraisal-Based Addendum: With this addendum, the price escalation is determined by the appraised value of the property. If the appraised value exceeds the initial offer, the purchase price will be adjusted accordingly. This type of addendum ensures that the price escalation is based on the fair market value of the property. It is important for buyers and sellers in North Dakota to carefully review and understand the terms and conditions of the Price Escalation Addendum to Agreement of Sale before signing. This addendum protects both parties from unexpected price increases and provides a transparent mechanism for adjusting the purchase price. In conclusion, a North Dakota Price Escalation Addendum to Agreement of Sale is a legal document used in real estate transactions to establish the terms and conditions for adjusting the purchase price. This addendum can take different forms, such as fixed escalation, percentage of difference, or appraisal-based, ensuring a fair and transparent process for all parties involved.
