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AZREB.com | Real Estate Clauses
ARTICLE
17.
Risk
of Loss; Casualty
.
17.1. Risk of Loss.
Subject to the other provisions of this Article and except for reasonable
wear and tear, Seller shall bear the risk of all loss, destruction and damage to
the Property by any casualty that occurs during the period from the Effective
Date to and including the earlier of (a) recordation of the Deed, or (b)
midnight of the last day of Closing.
17.2. Destruction or Damage Prior to Closing.
If at any time during the period described in Section 17.1, all or any
portion of the Property is lost, destroyed or damaged by casualty, then, subject
to the other provisions of this Agreement, Seller shall promptly give written
notice thereof to Buyer and the rights and obligations of the parties by reason
of such loss, destruction or damage shall be as follows:
(a)
If the Repair Cost is ten percent (10%) of the Purchase Price or less,
then (i) at Closing, Buyer shall accept the Property subject to such loss,
destruction or damage, (ii) the Purchase Price shall be reduced by the amount of
the Repair Cost, and (iii) Seller shall retain the right to all proceeds of
insurance. "Repair Cost"
means an estimate of the actual cost of repair and restoration attributable to
such loss, destruction or damage and obtained by Seller, within forty-five (45)
days after the destruction or damage, from a reputable, independent contractor
selected by Seller and licensed to do business in the jurisdiction in which the
Property is located.
(b)
If the Repair Cost exceeds ten percent (10%) of the Purchase Price and
within fifteen (15) days after the Repair Cost is determined Seller does not
agree to deduct the excess from the Purchase Price, then Buyer shall have the
right, exercisable only by giving notice to Seller (with a copy to Closing
Agent) within thirty (30) days after the Repair Cost is determined, to terminate
this Agreement. If Buyer duly exercises that right, then Closing Agent is
hereby instructed to return the Deposit to Buyer in accordance with Exhibit
"J" as Buyer's sole remedy.
If Buyer does not duly exercise that right, then (i) at Closing, Buyer
shall accept the Property subject to such loss, destruction or damage, (ii) the
Purchase Price shall be reduced by the Repair Cost, and (iii) Seller shall
retain the right to all proceeds of insurance.
If Seller does duly agree to deduct the excess Repair Cost from the
Purchase Price as aforesaid, then the provisions of clauses (i) through (iii) of
Section 17.2(a) shall apply to such destruction or damage.
(c)
Notwithstanding the foregoing provisions of this Section 17.2, (i) if the
Repair Cost exceeds ten percent (10%) of the Purchase Price and there is Seller
Financing, then Seller shall have the right, exercisable only by giving notice
to Buyer (with a copy to Closing Agent) within fifteen (15) days after the
Repair Cost is determined, to terminate this Agreement, and (ii) if the amount
of the proceeds that are payable or reasonably anticipated on account of any
loss, destruction or damage exceeds the Purchase Price, then Seller shall have
the right, exercisable only by giving notice to Buyer (with a copy to Closing
Agent) within fifteen (15) days after Seller is notified of that amount or
anticipated amount, to terminate this Agreement.
If Seller duly exercises that right, then Closing Agent is hereby
instructed to return the Deposit to Buyer in accordance with Exhibit
"J".
(d)
If a period described in the foregoing provisions of this Section 17.2
becomes applicable and the Closing Date would otherwise occur during such
period, then the Closing Date shall be extended to be a date selected by Seller.
Such new Closing Date shall be within thirty (30) days after the
applicable period(s).
17.3.
Notwithstanding the foregoing provisions of this Article, Buyer alone
shall be responsible for all loss, destruction and damage to the Property caused
by Buyer's or Buyer's Representatives.
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