Common use of Damage Holdback Clause in Contracts

Damage Holdback. Purchaser and Sellers acknowledge that certain Properties located in the State of Ohio were damaged as a result of the aftermath of Hurricane Ike. The Sellers of such Properties are currently in the process of repairing such damage to the Properties. To the extent that such Sellers, or any one of them, have not completed such repairs by the applicable Closing Date, then (a) the Sellers of the Properties for which such repairs have not been completed shall direct Escrow Agent, on the Closing Date, to hold back a total sum of Fifty Thousand Dollars ($50,000.00) (the “Ohio Property Holdback”) from the sale proceeds of the applicable aforementioned Properties, allocated on a pro rata basis determined by dividing the applicable Property’s Base Purchase Price, by the Base Purchase Prices for all of the Ohio Properties for which such repairs have not been completed. After the Closing, the applicable Sellers shall be responsible for completing the remaining repairs and all such repairs shall be completed in a good and workmanlike manner, shall return the applicable Property to its condition prior to the damage, shall comply with all applicable zoning and building codes, and shall be at such Sellers’s sole cost and expense. Upon completion of the repairs, the applicable Sellers shall assign to Purchaser all warranties, if any, held by such Sellers with respect to the materials or labor used in performing the repairs. The Ohio Property Holdback shall remain with Escrow Agent until the repairs to the Ohio Properties have been completed, at which time they shall be released by Escrow Agent (i) to Purchaser in an amount necessary to cover any items of expense or expenditure by Purchaser for repairs to the Ohio Properties (as documented by invoices) as a result of a Seller’s failure to complete the repairs as provided above, and (ii) the balance to the applicable Seller on a pro rata basis.