Common use of Damage Before Closing Clause in Contracts

Damage Before Closing. The Hotel Assets shall be at the risk of the Vendor for insurance purposes until the Closing Date. Prior to Closing, the Vendor shall maintain its current insurance on the Hotel Assets (or such other substantially similar insurance as reasonably determined by the Vendor). If loss or damage to the Hotel Assets occurs at any time prior to Closing, then: (a) if such loss or damage is of such a nature and to such an extent that the cost of repair or restoration, in the reasonable opinion of the Vendor’s independent architect or engineer, will exceed an amount in aggregate equal to 25% of the Purchase Price (“Substantial Damage”), then the Purchaser may by notice to the Vendor within five Business Days after it receives written notice of the occurrence of such Substantial Damage, elect to terminate this Agreement and the Deposit (together with all interest earned thereon, and any security provided by the Purchaser pursuant to Section 2.5(a)(iii), if applicable) shall be returned to the Purchaser forthwith after termination, subject to the Vendor’s rights pursuant to Section 2.5(c); and (b) if such loss or damage does not constitute Substantial Damage, or does constitute Substantial Damage but the Purchaser has elected not to exercise its right of termination pursuant to Section 8.2(a), then neither party shall have any right to terminate this Agreement by virtue thereof, the Vendor shall pay to the Purchaser on Closing (or, in the case of a right to proceeds of insurance, assign to the Purchaser on Closing) the total of all proceeds of insurance in respect of such loss or damage (except to the extent such proceeds compensate for income lost for the period before the Closing Date which proceeds shall be entirely the property of the Vendor) plus any deductibles relating to such insurance policies, and the parties shall complete the Transaction. With respect to the payments to be made by the Vendor to the Purchaser under this Section 8.2(b) with regard to the deductibles, the parties agree that such amounts may be credited in favour of the Purchaser against the Purchase Price payable by the Purchaser on Closing (rather than paid by the Vendor to the Purchaser). If the damage or destruction occurs at such time that there is insufficient time for the Purchaser to make its election hereunder, the Closing Date shall be postponed to a date which is five Business Days after the last day of the period for the Purchaser’s election, or if such date is not a Business Day, then the next Business Day thereafter. The rights to proceeds of insurance as set out in Section 8.2(b) shall survive Closing.

Damage Before Closing. The Hotel Assets interest of the Vendor in and to the Property shall be at the risk of the Vendor for insurance purposes until the Closing Date. Prior to Closing, the Vendor shall maintain its current insurance on the Hotel Assets (or such other substantially similar insurance as reasonably determined by the Vendor). If loss or damage to the Hotel Assets Property occurs at any time prior to Closing, then: (a) if such loss or damage is of such a nature and to such an extent that the cost of repair or restoration, in the reasonable opinion of the Vendor’s an independent architect or engineerengineer satisfactory to the Vendor and the Purchaser, each acting reasonably, given within 30 days of the occurrence of such loss or damage (the “Expert Opinion”) will exceed an amount Ten Million Dollars ($10,000,000.00) and will take longer than 180 days to repair, or if Tenants that, in aggregate equal to 25the aggregate, lease more than 5% of the Purchase Price square footage of the Buildings, have the right to terminate their Leases as a result of such damage (such damage to the Property being referred to herein as “Substantial Damage”), then the Purchaser may may, by written notice given to the Vendor within five ten (10) Business Days after it receives written notice its receipt of the occurrence of such Substantial DamageExpert Opinion, elect to terminate this Agreement and the parties shall be released from all obligations under this Agreement (except those which are expressly stated to survive termination of this Agreement). The Deposit (together with and all interest earned thereon, and any security provided by the Purchaser pursuant to Section 2.5(a)(iii), if applicable) thereon shall be returned to the Purchaser forthwith after termination, subject to the Vendor’s rights pursuant to Section 2.5(c)Purchaser; andor (b) if such loss or damage does is not constitute Substantial Damage, or does constitute is Substantial Damage but the Purchaser has not elected not to exercise its termination right of termination pursuant to Section 8.2(aSubsection 7.2(a), then neither party shall have any right to terminate this Agreement by virtue thereof, the Vendor shall pay adjust the Purchase Price in favour of the Purchaser by the amount of the insurance deductible and the Vendor shall assign the proceeds of the property insurance to the Purchaser on Closing (or, in the case of a right to proceeds of insurance, assign to the Purchaser on Closing) the total of all proceeds of insurance in respect of such loss or damage (except to the extent such proceeds compensate for income lost for the period before the Closing Date which proceeds shall be entirely the property of the Vendor) plus any deductibles relating to such insurance policies, and the parties shall complete the Transaction. With respect to Transaction without further delay or extension of the payments to be made by the Vendor to Closing Date and the Purchaser under this Section 8.2(b) with regard to the deductibles, the parties agree that such amounts may be credited in favour of the Purchaser against the Purchase Price payable by the Purchaser on Closing (rather than paid by the Vendor to the Purchaser)shall assume responsibility for remediation. If the damage or destruction occurs at such time that there is insufficient time for the Vendor or the Purchaser to make its election hereunder, the Closing Date shall be postponed to a date which is five (5) Business Days after the last day earlier of the date such election is made or the period for making such election has expired. For greater certainty, it is confirmed that in the Purchaser’s electionevent that Subsection 7.2(b) is applicable, the failure by the Vendor to complete any necessary repair or if such date is restoration prior to Closing shall not result in a Business Day, then delay or extension of the next Business Day thereafterClosing Date. The rights to proceeds of insurance as set out in This Section 8.2(b) 7.2 shall survive the Closing.