Common use of Right of Reentry and Revesting Clause in Contracts

Right of Reentry and Revesting. [to be revised to reference Retail Component or Residential Component only, as applicable] 1. Grantor has the right, at its election, to reenter and take possession of the [insert Retail Property or the Residential Property], with all improvements thereon, and terminate and revest in Grantor the estate conveyed to the Grantee, if after the Closing and prior to the issuance of the Release of Construction Covenants as to one hundred percent (100%) of the [Retail Component or the Residential Component], the Grantee shall: (a) fail to start the construction of the [Retail Component or the Residential Component] as required by this Agreement for a period of sixty (60) days subject to Sections 301.1 and 602, after written notice thereof from Grantor; provided, however, with respect to the pad and any other buildings not leased by the Grantee prior to the Closing, such sixty (60) day period shall be extended for such time as reasonably necessary for Grantee, exercising due diligence, to execute a lease with a tenant for such pad or building location, and for the Grantee or such tenant to commence construction of such pad building; or (b) abandon or substantially suspend construction of the [Retail Component or the Residential Component] required by this Agreement for a period of ninety (90) days, subject to Sections 301.1 and 602, after written notice thereof from Grantor; or (c) contrary to the provisions of Section 603 transfer or suffer any involuntary transfer of [the Retail Property or the Residential Property] in violation of this Agreement. 2. Such right to reenter, terminate and revest shall be subject to and be limited by and shall not defeat, render invalid or limit: 1. Any mortgage or deed of trust permitted by this Agreement; or 2. Any rights or interests provided in this Agreement for the protection of the holders of such mortgages or deeds of trust. Grantor shall have the right as set forth in this Section, under specified circumstances prior to recordation of the Release of Construction Covenants, to reenter and take possession of [the Retail Property or the Residential Property], with all improvements thereon, and to terminate and revest in Grantor the estate conveyed to the Grantee. Upon the revesting in Grantor of title to [the Retail Property or the Residential Property], as provided in this Section, Grantor shall, pursuant to its responsibilities under state law, use its reasonable efforts to resell [the Retail Property or Residential Property] as soon and in such manner as Grantor shall find feasible and consistent with the objectives of such law, as it exists or may be amended, to a qualified and responsible party or parties (as determined by Grantor) who will assume the obligation of making or completing the [Retail Component or the Residential Component] or such improvements in their stead as shall be satisfactory to Grantor. Grantee acknowledges that there may be substantial delays experienced by Grantor if Grantor must remarket [the Retail Property or the Residential Property] following the revesting of [the Retail Property or the Residential Property] in Grantor. Upon such resale of [the Retail Property or the Residential Property], the net proceeds thereof after repayment of any mortgage or deed of trust encumbering [the Retail Property or the Residential Property], which is permitted by this Agreement, shall be applied: (i) First, to reimburse Grantor, on its own behalf, all reasonable costs and expenses incurred by Grantor, excluding City staff costs, but specifically including, without limitation, any expenditures by Grantor, in connection with the recapture, management and resale of [the Retail Property or the Residential Property] or part thereof (but less any income derived by Grantor from [the Retail Property or the Residential Property] or part thereof in connection with such management); all taxes, assessments and water or sewer charges with respect to [the Retail Property or the Residential Property] or part thereof which the Grantee has not paid, any payments made or necessary to be made to discharge any encumbrances or liens existing on [the Retail Property or the Residential Property] or part thereof at the time or revesting of title thereto in Grantor, or to discharge or prevent from attaching or being made any subsequent encumbrances or liens due to obligations, defaults or acts of the Grantee, its successors or transferees; any expenditures made or obligations incurred with respect to the making or completion of the [Retail Component or the Residential Component], or any part thereof; and any amounts otherwise owing Grantor, and in the event additional proceeds are thereafter available, then (ii) Second, to reimburse Grantee, its successor or transferee, up to the amount equal to the sum of (a) all costs and expenses incurred for the acquisition of [the Retail Property or the Residential Property], as applicable (including without limitation architectural fees, engineering fees, environmental reports, and studies, loan fees, legal fees, and consultant fees), plus (b) Developer Costs, less (c) any gains or income withdrawn or made by the Grantee from [the Retail Property or the Residential Property], as applicable, or the improvements thereon. Any balance remaining after such reimbursements shall be retained by Grantor as its property. The rights established in this Section are not intended to be exclusive of any other right, power or remedy, but each and every such right, power, and remedy shall be cumulative and concurrent and shall be in addition to any other right, power and remedy authorized herein or now or hereafter existing at law or in equity. These rights are to be interpreted in light of the fact that Grantor will have conveyed [the Retail Property and the Residential Property] to [the Retail Developer and Residential Developer] for development purposes, and not for speculation in land. The rights of Grantor pursuant to this Section shall be subordinate to the rights of the construction and permanent lender approved by Grantor. Notwithstanding the foregoing or anything contained herein to the contrary, (i) the terms of Section 505 shall apply separately to [the Retail Property and the Residential Property], (ii) in the event Retail Developer fails to comply with the terms of Sections 505(a), (b) and (c) with respect to the Retail Property, Grantor shall have no right to acquire the Residential Property so long as the Residential Developer complies with the terms of Sections 505(a), (b) and (c) with respect to the Residential Property, and (iii) in the event Residential Developer fails to comply with the terms of Sections 505(a), (b) and (c) with respect to the Residential Property, Grantor shall have no right to acquire the Retail Property so long as the Retail Developer complies with the terms of Sections 505(a), (b) and (c) with respect to the Retail Property.