Compensation Event Clause Samples
A Compensation Event clause defines circumstances under which one party is entitled to claim additional payment or time due to changes or unforeseen events affecting the contract. Typically, this clause applies when the employer issues instructions that alter the scope of work, or when unexpected site conditions arise, requiring the contractor to adjust their approach or incur extra costs. Its core function is to provide a clear mechanism for adjusting the contract price or schedule, ensuring that both parties are fairly compensated and that risks associated with changes are managed transparently.
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Compensation Event. (a) If Sections 15.2(a) and 15.2(b) require Project Co to perform any alteration, addition, demolition, extension or variation in the Work or to suspend or delay performance of the Work as a result of such discovery and which would not otherwise be required under this Project Agreement, then any such alteration, addition, demolition, extension or variation in the Work, or suspension or delay in the performance of the Work, shall, subject to and in accordance with Article 22, be treated as a Delay Event and, subject to and in accordance with Article 23, be treated as a Compensation Event, provided however that the foregoing shall not apply to the extent that any item referred to in Section 15.1(a) was disclosed in or properly inferable, readily apparent or readily discoverable from the Site Information or would have been properly inferable, readily apparent or readily discoverable from inspections of the Site carried out by Project Co or by any Project Co Party during the Request for Proposals process prior to the Submission Date.
Compensation Event. In the case of a Compensation Event, the Contracting Authority must pay the Contractor (or where a Contracting Authority Change is concerned, the Contractor may have to pay the Contracting Authority) compensation in accordance with Schedule 3 (Compensation for Supervening Events), paragraph 2 (Compensation Event).
Compensation Event. In the cases specified in the Agreement, the losses incurred by the Private partner due to the Compensation Event are compensated by the Public partner.
Compensation Event. Request
(a) If as a direct result of the occurrence of a Compensation Event:
(i) the Operator is unable to comply with its obligations under this Agreement; and/or
(ii) the Operator has incurred Eligible Costs, notwithstanding the Operator using all reasonable endeavours and in accordance with Good Industry Practice to mitigate the effect of such Compensation Event in its performance of its obligations under this Agreement, the Operator may apply for an extension and/or relief from its obligations under this Agreement and/or for compensation under this Agreement.
(b) Any such request shall be made by service of an initial notice on the Authority within two (2) Business Days of the Operator becoming aware of the occurrence of a Compensation Event,
(c) Without prejudice to the generality of the request in paragraph (b) above, the Operator shall provide the Authority within ten (10) Business Days of the Operator becoming aware of the occurrence of a Compensation Event with a subsequent notice, including:
(i) the direct effect of the Compensation Event on the Operator’s ability to perform any of its obligations under this Agreement, including details of the relevant obligations, the precise effect on each such obligation and the likely duration of that effect;
(ii) an explanation of any measures that the Operator proposes or intends to adopt to mitigate the consequences of the Compensation Event; and
(iii) details of the Eligible Costs incurred and to be incurred for the duration of the Compensation Event, and which could not reasonably be expected to be mitigated or recovered by the Operator, acting in accordance with Good Industry Practice.
Compensation Event. In case the Parties agree to postpone the time of commencement of provision of the Services, the period of validity of the Agreement shall not be changed.
Compensation Event. (a) The Chargor shall:
(i) notify the Chargee of any Compensation Event and keep the Chargee informed of all matters relating to it; and
(ii) subject to clause 8.8(c), use its best endeavours to cause the prompt payment of any compensation or moneys payable in relation to that Compensation Event in excess of the Threshold Amount.
(b) After an Event of Default has occurred, the Chargee may, but the Chargor shall not without the consent of the Chargee (not to be unreasonably withheld), enforce, conduct, settle or compromise claims in relation to any Compensation Event.
(c) Any moneys paid by a person in respect of any Compensation Event shall be applied as follows:
(i) first, as the Chargee requires in payment of any part of the Secured Money which is then actually owing whether or not it is due for payment; and
(ii) secondly, the balance (if any) shall be paid to any person entitled to them or authorised to give receipts for them.
Compensation Event. 31.1 The following are compensation events for the purposes of the Contract:
(1) The Superintending Officer gives an instruction for Variation of the Works under Clause 28 (except where such change was made in order to accept defect of the Works or arises from, necessitated by or intended to cure any default or breach of contract by the Contractor);
(2) Exceptionally inclement weather;
(3) Industrial action by workmen, strikes, lock-outs or embargoes affecting any of the trades employed upon the Works or in the preparation, manufacture or transportation of any Equipment, materials or goods for the Works and provided that the same are not due to any unreasonable act or default of the Contractor or of any sub-contractor or supplier. Provided that this event shall only apply if the industrial action by workmen, strike, lock-out or embargo causing delay is in Malaysia;
(4) One or more of the Excepted Risks (time only);
(5) The Contractor not having received from the Superintending Officer within a reasonable time necessary Drawings, instructions or other information in regard to the Works for which notice has been given by the Contractor in accordance with Clause 4.6 or the supplementary or revised drawing, specifications, or instruction as required by Clause 4.7;
(6) An instruction from the Superintending Officer to resolve a Discrepancy in or between any of the Contract Documents pursuant to Clause 7.5;
Compensation Event. 31.1 The following are compensation events for the purposes of the Contract:
(a) The Superintending Officer gives an instruction for Variation of the Works under Clause 28 (except where such change was made in order to accept defect of the Works or arises from, necessitated by or intended to cure any default or breach of contract by the Contractor);
(b) Exceptionally inclement weather;
(c) Industrial action by workmen, strikes, lock-outs or embargoes affecting any of the trades employed upon the Works or in the preparation, manufacture or transportation of any Equipment, materials or goods for the Works and provided that the same are not due to any unreasonable act or default of the Contractor or of any sub-contractor or supplier. Provided that this event shall only apply if the industrial action by workmen, strike, lock-out or embargo causing delay is in Malaysia;
(d) One or more of the Excepted Risks. For this compensation event, only change of Date or Time for Completion is allowed;
(e) The Contractor not having received from the Superintending Officer within a reasonable time necessary Drawings, instructions or other information in regard to the Works for which notice has been given by the Contractor in accordance with Clause 4.6 or the supplementary or revised drawing, specifications, or instruction as required by Clause 4.7;
(f) An instruction from the Superintending Officer to resolve a Discrepancy in or between any of the Contract Documents pursuant to Clause 7.5;
(g) Compliance with Statutory Requirements for which the Employer is responsible under Clause 10.1 or which results in a Variation pursuant to Clause 10.2;
(h) Ordering of test by the Superintending Officer which is not intended by or provided for in the Contract pursuant to Clause 15.4 and the uncovering or making openings for inspection of any work which is not intended by or provided for in the Contract pursuant to Clause 15.6, unless the test or inspection showed that the work, the Equipment, materials, goods or workmanship were not in accordance with the provisions of the Contract;
(i) Failure of the Employer to give possession of the Site or any part of the Site to the Contractor as required by Clause 17.2;
(j) Acts or omissions of or disruption caused by other persons or contractors employed by the Employer in executing work not forming part of the Contract;
(k) Subject to sub-clause 19.1(b) an instruction by the Superintending Officer to suspend any work;
(l) Damage, loss or injur...
Compensation Event. If Nalcor does not comply with its obligations to deliver the Nova Scotia Block to Emera in accordance with this Agreement for all or the remainder of the Initial Term, as applicable:
(i) for any reason, other than a Forgivable Event of any duration, which is not cured within 24 months after such non-delivery commenced, Emera shall have the option to continue to claim any damages due under Section 8.4 in respect of a failure by Nalcor to deliver Block B Undelivered Energy as provided in Section 8.4(a) or to deem such non-delivery a Compensation Event to which this Section 8.6 applies;
(ii) by reason of Government Action which prevents the delivery of all or substantially all of the Nova Scotia Block, Emera shall have the option to deem such default to be a Compensation Event to which this Section 8.6 applies;
(iii) by reason of a breach by Nalcor of Section 11.4(g) of the NLDA, which breach shall constitute a Compensation Event to which this Section 8.6 shall apply; or
(iv) all or a material portion of the MFP Development Activities are discontinued or cease for a single continuous period in excess of 120 days, unless contemplated by the project schedule or for seasonal interruptions that are customary in the usual and ordinary course of the MFP Development Activities or for Force Majeure (as “Force Majeure” is defined in the NLDA) or for the suspension of MFP Development Activities pursuant to Section 2.10 of the NLDA, which discontinuance or cessation shall constitute a Compensation Event to which this Section 8.6 shall apply. With respect to a Compensation Event, Emera, provided it is in material compliance with its obligations under this Agreement, the Maritime Link Transmission Service Agreements and the Nova Scotia Transmission Utilization Agreement may on 30 days’ Notice require Nalcor, subject to Section 8.2(d) with respect to a Government Action, to compensate Emera by paying or delivering an amount equal to the aggregate of:
(v) the Compensation Value as defined in Section 8.6(b) and as may be subject to Section 8.6(c); plus
(vi) without duplication, the reasonable out-of-pocket costs, expenses, fees, penalties or fines incurred by Emera as a direct result of such Compensation Event (collectively, the “Compensation Damages”).
Compensation Event. If, at any time, as a direct result of the occurrence of a Compensation Event: