Damage or Destruction Clause Samples
The Damage or Destruction clause outlines the rights and responsibilities of the parties if the subject property is damaged or destroyed during the term of the agreement. Typically, it specifies procedures for repair, restoration, or termination of the contract depending on the extent of the damage, and may address issues such as insurance proceeds and obligations to rebuild. This clause ensures that both parties understand their options and liabilities in the event of unforeseen property loss, thereby reducing uncertainty and potential disputes.
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Damage or Destruction. If any Property shall be damaged or destroyed, in whole or in part, by fire or other property hazard or casualty, Borrower shall give prompt notice thereof to Lender and one hundred (100%) percent of the net amount of all insurance proceeds received by Lender or Borrower as a result of such damage or destruction after deduction of reasonable costs and the expenses, if any, in collecting the same, shall be applied in reduction of the outstanding Principal Balance under the Note pertaining to the Damaged Property. Notwithstanding anything to the contrary set forth above, if a particular Property (a "DAMAGED PROPERTY") shall be damaged or destroyed, in whole or in part, by fire or other casualty, Lender shall, in accordance with the provisions of this Section hereinafter set forth, make the net amount of all insurance proceeds received by Lender pursuant to the provisions of this Agreement as a result of such damage or destruction after deduction of its reasonable costs and expenses, if any, in collecting the same (hereinafter referred to as the "NET PROCEEDS") available for the repair and restoration of the Damaged Property, provided that (i) no default shall have occurred and shall be continuing under the Loan Documents, (ii) Borrower shall commence the repair and restoration of the Damaged Property, as nearly as possible to the condition the Damaged Property was in immediately prior to such fire or other casualty, with such alterations as may be approved by Lender, as soon as reasonably practicable, and shall diligently pursue the same to satisfactory completion, (iii) Lender shall be satisfied that any operating deficits which will be incurred with respect to the Damaged Property as a result of the occurrence of any such fire or other casualty will be covered out of the Net Proceeds or by Borrower out-of-pocket or with the proceeds, if any, of business interruption or rental interruption insurance, (iv) Lender shall be satisfied that, within a reasonable period of time, not to exceed one hundred eighty (180) days following the completion of such repair and restoration of the Damaged Property, the gross cash flow and the net cash flow of the Damaged Property will be restored to a level sufficient to cover all carrying costs and operating expenses of the Damaged Property, (v) Lender shall be satisfied that the repair and restoration of the Damaged Property will be completed on or before the earlier to occur of (w) ninety (90) days prior to the Maturity Date...
Damage or Destruction. If the Premises shall be partially damaged by fire or other casualty, but not rendered untenantable, the same shall be repaired with due diligence by Lessor at its own cost and expense; if the damage shall be so extensive as to render the Premises untenantable but capable of being repaired, the same shall be repaired with due diligence by Lessor at its own cost and expense and the rent payable hereunder shall be proportionately paid up to the time of such damage and shall thenceforth cease until such time as the Premises shall be put in good order. In the event the Premises shall be completely destroyed by fire or other casualty or so damaged that it will remain untenantable for more than thirty (30) days, or in case it does so remain untenantable for more than thirty (30) days, at the option of Lessor (1) the Premises shall be repaired or reconstructed with due diligence by Lessor at its own cost and expense and the rent payable hereunder shall be proportionately paid up to the time of such damage or destruction and shall thenceforth cease until such time as the Premises shall be put in good order; or (2) within sixty (60) days after the time of such damage or destruction and before the Premises shall be put in order, either party may give the other party written notice of its election to cancel this agreement in its entirety, and Lessee shall be liable for rent only up to the time of such damage or destruction. It is understood and agreed that nothing in this article concerning rental abatements or cancellation by Lessee shall apply in the case of damages to or the destruction of the leased Premises which is caused by the negligent acts of Lessee, its agents, employees or invitees, and further that Lessee shall, at its own expense, repair all such damages resulting from such acts; except that Lessee shall not be responsible to Lessor for damages to property or equipment fully covered by Lessor’s insurance.
Damage or Destruction. 22.1. In the event of a partial destruction of the Building or the Project by fire or other perils covered by extended coverage insurance not exceeding twenty-five percent (25%) of the full insurable value thereof, and provided that (a) the damage thereto is such that the Building or the Project may be repaired, reconstructed or restored within a period of eight (8) months from the date of the happening of such casualty and (b) Landlord shall receive insurance proceeds sufficient to cover the cost of such repairs (except for any deductible amount provided by Landlord’s policy, which deductible amount, if paid by Landlord, shall constitute an Operating Expense), Landlord shall commence and proceed diligently with the work of repair, reconstruction and restoration of the Building or the Project, as applicable, and this Lease shall continue in full force and effect. Notwithstanding the foregoing, Landlord may not terminate this Lease pursuant to clause (b) of this Section 22.1 unless the cost of such repairs in excess of any deductible amount and any available insurance proceeds to restore the Building and other improvements on the Property exceeds Two Hundred Fifty Thousand Dollars ($250,000).
22.2. In the event of any damage to or destruction of the Building or the Project other than as described in Section 22.1, Landlord may elect to repair, reconstruct and restore the Building or the Project, as applicable, in which case this Lease shall continue in full force and effect. If Landlord elects not to repair the Building or the Project, as applicable, then this Lease shall terminate as of the date of such damage or destruction.
22.3. Within sixty (60) days following the date of damage or destruction, Landlord shall give written notice to Tenant either (a) of its election not to repair, reconstruct or restore the Building or the Project, as applicable, or (b) of the amount of time reasonably anticipated to be required to complete the repair, reconstruction and/or restoration of the Premises and the parking facilities of the Project.
22.4. Upon any termination of this Lease under any of the provisions of this Section 22, the parties shall be released thereby without further obligation to the other from the date possession of the Premises is surrendered to the Landlord, except with regard to (a) items occurring prior to the damage or destruction and (b) provisions of this Lease that, by their express terms, survive the expiration or earlier termination hereof.
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Damage or Destruction. 22.1 In the event of damage to or destruction of all or any portion of the Project or the Premises or the improvements and fixtures thereon (collectively, “improvements”) arising from a risk covered by the insurance described in Section 21.2, Landlord shall within a reasonable time commence and proceed diligently to repair, reconstruct and restore (collectively, “restore”) the improvements to substantially the same condition as they were in immediately prior to the casualty. Tenant shall be responsible for its Pro Rata Share of insurance deductibles and for all costs of restoration in excess of insurance proceeds as Operating Expenses pursuant to the provisions of Article 7, provided, however, that any such costs which would be deemed of a “capital” nature under generally accepted accounting principles shall be amortized over the useful life of the repair or replacement as determined under Internal Revenue Service guidelines, and Tenant shall pay only that portion of the costs which are amortized over the balance of the term, payable at the time the costs are incurred to the extent Tenant’s share of the costs are less than $1.75 per square foot of Rentable Area of the Premises, with the balance payable on a monthly basis during the balance of the term. In no event shall Tenant be liable for costs of restoration to the extent the inadequacy of insurance proceeds is due to Landlord’s failure to carry the insurance required to be carried by Landlord pursuant to the terms of this Lease.
22.2 In the event of any damage to or destruction of all or any portion of the improvements arising from a risk which is not covered by the insurance required to be carried by Landlord pursuant to Section 21.2, Landlord may elect at its cost to restore the improvements, in which event Landlord shall, within a reasonable time, commence and proceed diligently to restore the improvements to substantially the same condition as they were in immediately prior to the casualty. In the event Landlord elects not to restore the improvements, this Lease shall terminate as of the date of the damage or destruction unless Tenant elects to pay the full cost of restoration.
22.3 In the event the improvements are restored pursuant to Section 22.1 or Section 22.2, this Lease shall continue in full force and effect, notwithstanding such damage or destruction; provided, however, that if the damage or destruction (i) occurs during the last year of the term and the expense of restoration exceeds $500...
Damage or Destruction. If, during the Term of this Agreement, the entire Parking Facility or such portion thereof as shall render the Premises unsuitable for the continued conduct of the Tenant’s and its invitees activities thereon, shall be damaged or destroyed by fire or other casualty, then Landlord shall be entitled to retain all insurance proceeds payable by reason of and with respect to the damage or destruction to the Premises and Landlord shall rebuild or reconstruct the Parking Facility in a commercially reasonable and efficient manner subject to the following terms and conditions: (i) the casualty must be insured under Landlord's insurance policies, and Landlord’s obligation is limited to the extent of the insurance proceeds received by Landlord, (ii) Landlord’s duty to repair and restore the Premises shall not begin until receipt of the insurance proceeds, (iii) Landlord’s lender(s) must permit the insurance proceeds to be used for such repair and restoration, (iv) Landlord shall have no obligation to repair and restore any personal property on the Premises belonging to Tenant or any of Tenant’s employees, contractors, agents or invitees, (v) Landlord shall have no obligation to restore the damage or destruction (or to complete any restoration) during the last year of the Term or of any Option Period if Tenant has delivered notice that it is not renewing the Term of this Agreement pursuant to Section 2.2 or if Tenant has no more extension options pursuant to this Agreement, and (vi) Landlord shall rebuild or reconstruct the Parking Facility to a configuration substantially equivalent to that configuration which existed as of the Commencement Date. During the period in which the Parking is unavailable to a Tenant for any reason caused by Landlord during the Term of this Agreement for a period of more than thirty (30) consecutive days, including, without limitation, any such period during which Landlord is repairing and restoring the Parking Facility, the rental payable by Tenant shall ▇▇▇▇▇. The abatement of the rent shall be the exclusive remedy of Tenant against Landlord in the event of a casualty involving the Premises. Tenant hereby waives all claims against Landlord for any compensation or damage for loss of use of the whole or any part of the Premises and/or for any inconvenience or annoyance occasioned by any casualty and any resulting damage, destruction, repair, or restoration.
Damage or Destruction. In the event that the Property should be damaged or destroyed by fire or any other casualty prior to the Closing Date, then Seller shall promptly provide Buyer with written notice of such casualty. If the cost of repairing such damage, as estimated by an architect or contractor retained pursuant to the mutual agreement of the Parties (the “Cost of Repairs”), is (a) less than Two Hundred Thousand Dollars ($200,000), then the Closing shall proceed as scheduled and (i) Seller shall cause all collected insurance proceeds, plus the cash amount of all associated deductibles, to be paid over to Buyer (or credited against the Purchase Price) at Closing, (ii) Seller shall assign to Buyer all right, title and interest in and to all claims and proceeds Seller may have with respect to all policies of insurance relating to the Property at Closing, and (iii) Seller shall pay over to Buyer all insurance proceeds collected after the Closing by Seller promptly upon receipt thereof; or (b) greater than Two Hundred Thousand Dollars ($200,000), then Buyer may in its discretion either (i) elect to terminate this Agreement in its entirety, in which case the Deposit shall be returned to Buyer without any further action required from either Party, Buyer and Seller shall each be liable for one-half of any escrow fees or charges and neither Party shall have any further obligation to the other, or (ii) proceed as scheduled and (x) Seller shall cause all collected insurance proceeds, plus the cash amount of all associated deductibles, to be paid over to Buyer (or credited against the Purchase Price) at Closing, (y) Seller shall assign to Buyer all right, title and interest in and to all claims and proceeds Seller may have with respect to all policies of insurance relating to the Property at Closing, and (z) Seller shall pay over to Buyer all insurance proceeds collected after the Closing by Seller promptly upon receipt thereof. In the event that the casualty is uninsured, Buyer may terminate this Agreement in its entirety unless Buyer receives a credit against the Purchase Price equal to the Cost of Repairs. The foregoing notwithstanding, in the event any casualty results in the cancellation of, or rental abatement under, any Lease, Buyer shall have the option to terminate this Agreement without regard to the Cost of Repairs. Any notice required to terminate this Agreement pursuant to this Section shall be delivered no later than thirty (30) days following Buyer’s receipt of Seller’s...
Damage or Destruction. 19.1 If the Property or the Demised Premises is partially or totally damaged or destroyed by fire or other casualty (and this Lease is not terminated as provided in this Article), Landlord shall (at no cost to Tenant) repair the damage and restore and rebuild the Property or the Demised Premises, as the case may be, in a good and workmanlike manner using materials generally of a quality at least equal to those that existed previously, promptly and with reasonable diligence after notice to it of the damage or destruction.
19.2 If all or part of the Demised Premises is damaged or destroyed or rendered completely or partially untenantable or not reasonably accessible by fire or other casualty, Fixed Rent and any Additional Charges payable under this Lease shall be reduced in the proportion that the untenantable area of the Demised Premises bears to the total rentable square feet of the Demised Premises for the period from the date of the damage or destruction to (a) thirty (30) days after the date on which Landlord gives Tenant notice that the damage is substantially repaired and tenantable possession of and reasonable access to the Demised Premises is tendered to Tenant; provided, however, should Tenant reoccupy a portion of the Demised Premises during the period in which repair work is taking place and prior to the date the Demised Premises is substantially repaired or made tenantable, Fixed Rent and any Additional Charges payable under this Lease allocable to such reoccupied portion, based upon the proportion which area of the reoccupied portion of the Demised Premises bears to the total rentable square feet of the Premises, shall be payable by Tenant from the date of such occupancy.
19.3 If the Demised Premises is materially damaged or destroyed by fire or other casualty, or if the Demised Premises is so damaged or destroyed by fire or other casualty that its repair or restoration requires the expenditure (as estimated by a licensed, reputable independent third-party contractor or architect designated by Landlord) of more than 90% of the full insurable value of the Demised Premises immediately prior to the fire or other casualty or if commercially reasonable access to the Demised Premises is not possible (each a “Substantial Casualty”), then in either such case either Landlord or Tenant may terminate this Lease by giving the other party notice to such effect within sixty (60) days after the date of the fire or other casualty and Fixed Rent and any Additio...
Damage or Destruction. In the event improvements on the Property are materially damaged or destroyed prior to Closing, Buyer shall have the right to terminate this Agreement, in which event Buyer shall receive a full refund of the Deposit.
Damage or Destruction. If any of the Improvements shall be destroyed --------------------- or damaged prior to the Closing, and the estimated cost of repair or replacement exceeds $100,000.00 or if the Lease shall terminate as a result of such damage, Purchaser may, by written notice given to Seller within twenty (20) days after receipt of written notice from Seller of such damage or destruction, elect to terminate this Agreement, in which event the ▇▇▇▇▇▇▇ Money shall immediately be returned by Escrow Agent to Purchaser and except as expressly provided herein to the contrary, the rights, duties, obligations, and liabilities of all parties hereunder shall immediately terminate and be of no further force or effect. If Purchaser does not elect to terminate this Agreement pursuant to this Paragraph 18, or has no right to terminate this Agreement (because the damage or destruction does not exceed $100,000.00 and the Lease remains in full force and effect), and the sale of the Property is consummated, Purchaser shall be entitled to receive all insurance proceeds paid or payable to Seller by reason of such destruction or damage under the insurance required to be maintained by Seller pursuant to Paragraph 9(d) hereof (less amounts of insurance theretofore received and applied by Seller to restoration). If the amount of said casualty or rent loss insurance proceeds is not settled by the date of Closing, Seller shall execute at Closing all proofs of loss, assignments of claim, and other similar instruments to ensure that Purchaser shall receive all of Seller's right, title, and interest in and under said insurance proceeds.
Damage or Destruction. (a) Tenant shall give Landlord prompt notice of any damage to the Premises by fire or other casualty.
(b) If the Premises shall be rendered wholly untenantable by a casualty, unless terminated pursuant to Section 7.1(d)(i) or 7.1(d)(ii) hereof, this Lease shall remain in full force and effect except that Rent shall fully ▇▇▇▇▇ commencing on the date of loss and continuing until the earlier to occur of: (i) the date Tenant reopens the Premises for business, which reopening Landlord and Tenant shall diligently work together to expedite, or (ii) the date forty five (45) days after Tenant completes the restoration, pursuant to Section 7.1(e), of the structural elements of the building of which the Premises form a part.
(c) If only a portion of the Premises shall be rendered untenantable, this Lease shall remain in full force and effect except that Rent shall partially ▇▇▇▇▇ commencing on the date of loss and continuing until the earlier to occur of: (i) the date Tenant reopens the repaired portion of the Premises for business, which reopening Landlord and Tenant shall diligently work together to expedite, or (ii) the date forty five (45) days after Landlord completes the restoration, pursuant to Section 7.1(e), of the structural elements of the building of which the Premises form a part. In such event, the Rent shall be reduced to an amount computed by multiplying the Rent applicable prior to such damage by a fraction, the numerator of which is the Floor Area of the Premises tenantable after such damage and the denominator of which is the Floor Area of the Premises prior to such damage.
(d) If there shall be damage to the Shopping Center by fire or other casualty, whether or not the Premises is affected thereby, in which: (i) the Premises shall be sufficiently damaged to render the entire Premises wholly untenantable; (ii) the damage or destruction to the Premises is to an extent that it cannot be repaired with reasonable diligence within one (1) year after the destruction or damage; (iii) either the Shopping Center or the building of which the Premises are a part is damaged to the extent of fifty percent (50%) or more of its insured replacement cost; (iv) the loss is caused by any risk not covered by either Landlord's or Tenant's insurance; (v) the damage occurs during the last three (3) years of the Term; or, (vi) any insurance proceeds received by Landlord or Tenant for such damage are inadequate or unavailable for repairs, other than because of any deducti...