Common use of Damages and Default Clause in Contracts

Damages and Default. In the event of a failure or refusal of either party to comply with its obligations hereunder, the following shall apply: a. If Buyer fails or refuses to timely comply with Buyer’s obligations hereunder for any reason other than the failure of an express condition to Buyer’s obligations set forth in this Agreement, or Seller’s default under this Agreement, and Buyer fails to cure such default within five (5) business days after receiving written notice thereof from Seller (except that there shall be no cure period for Buyer’s failure to timely close on or before the Closing Date), then Seller may terminate this Agreement upon written notice to Buyer; and as Seller’s sole and exclusive remedy (subject to the immediately following sentence) the Title Company shall pay to Seller the Deposit together with interest earned thereon, it being agreed that the Deposit will be delivered to Seller as liquidated damages and not a penalty, in full satisfaction of Seller’s claims against Buyer hereunder. In addition, however, Buyer shall also return to Seller all original materials supplied by Seller (and not supplied by email or via internet site) on account of this transaction and shall also deliver to Seller, without warranty or representation of any kind, copies of all studies and reports obtained by Buyer with regard to the physical characteristics of the Property, and Buyer shall continue to be responsible for it indemnification obligation under Section 4.2 above. Seller and Buyer agree that it is difficult to determine the actual amount of Seller’s damages arising out of Buyer’s breach but said amount is a fair estimate of those damages which have been agreed to by the parties in a sincere effort to make the damages certain. b. Should Seller fail or refuse to timely comply with Seller’s obligations hereunder for any reason other than the failure of an express condition to Seller’s obligation set forth in this Agreement, or Buyer’s default under this Agreement, and Seller fails to cure such default within five (5) business days after receiving written notice (“Default Notice”) thereof from Buyer (except that there shall be no cure period for Seller’s failure to timely close on or before the Closing Date), then (i) Buyer may terminate this Agreement upon written notice to Seller, whereupon Buyer shall be entitled to receive an immediate return of the Deposit together with the interest earned thereon from the Title Company plus Seller shall reimburse Buyer for the verifiable out-of-pocket expenses paid by Buyer to unrelated third parties in relation to its inspection of the Property, or (ii) Buyer may enforce specific performance of this Agreement. The above remedies shall be Buyer’s sole and exclusive remedies for default by Seller hereunder. In the event Buyer elects to seek specific performance of this Agreement, Buyer shall (i) initiate any litigation seeking such specific performance within two (2) years and thirty (30) days following Buyer’s delivery of the Default Notice and (ii) contemporaneously with the filing of such litigation, deposit the entire Purchase Price (less the Deposit) into the registry of the court in which such litigation is initiated, and at the direction of Buyer, if legally required in order to maintain such specific performance action, Title Company will release the Deposit to the court registry.