Common use of Loss by Fire or Other Casualty Condemnation Clause in Contracts

Loss by Fire or Other Casualty Condemnation. If, prior to the Closing, the Property is destroyed or materially damaged, or if condemnation proceedings are commenced against a material portion of the Property (each, a “Material Loss”), Buyer shall have the right, at its option, exercisable by giving written notice of such decision to Seller within five (5) business days after receiving written notice from Seller that the Property has suffered a Material Loss, to either: (a) terminate this Agreement, in which case Escrow Holder shall return the Deposit to Buyer and, except for those matters which expressly survive any termination hereof, neither Party shall have any further rights or obligations hereunder, or (b) accept the Property in its then condition with no reduction of the Purchase Price. Buyer’s failure to give written notice of its election within such timeframe shall be deemed to be Buyer’s election not to terminate this Agreement and to accept the Property in its then condition in accordance with clause (b) of the immediately preceding sentence. If Buyer elects to accept (or is deemed to have accepted) the Property in its then condition, all proceeds of insurance or condemnation awards payable by reason of such damage, destruction or condemnation, if any, shall be paid or assigned to Buyer at the Closing. If the damage or condemnation does not result in a Material Loss, then (i) Buyer shall have no right to terminate this Agreement, and (ii) Seller shall assign to Buyer at the Closing all proceeds of insurance or condemnation awards payable by reason of such damage or condemnation, if any. As used in this ARTICLE VII, “destroyed” means complete destruction of the improvements upon the Property, and “material” damage, or the loss of a “material portion” of the Property, means any damage or loss that: (I) results in repair or restoration costs in excess of twenty percent (20%) of the Purchase Price; or (II) results in Buyer not being able to occupy the Property for a period in excess of six (6) months following the Closing. For the avoidance of doubt, in no event shall the COVID-19 pandemic or any governmental response thereto constitute a Material Loss.