Common use of Loss Events Clause in Contracts

Loss Events. (a) If, after the Execution Date but prior to the Closing, all or any portion of the Company Assets are destroyed or damaged by fire, flood, earthquake, storm, theft, vandalism, explosion, blowout, riot, sabotage, accident or other casualty of a similar nature and the aggregate amount of the reasonably estimated Restoration Cost in respect thereof exceeds $100,000 (a “Casualty Loss”) or is taken in condemnation or under right of eminent domain and the aggregate amount of the reasonably estimated Restoration Cost in respect thereof exceeds $100,000 (a “Takings Loss” and together with a Casualty Loss, a “Loss Event”), Seller will promptly send notice to Buyer of the occurrence of such event (a “Loss Event Notice”) and provide Buyer with all reasonably requested information with respect thereto, including allowing Buyer and its Representatives to visit and survey the damage resulting therefrom. If either Party believes in good faith that the amount of the aggregate Restoration Cost for such Loss Events is equal to or exceeds $3,300,000, the Parties will together promptly select an independent third-party appraiser with relevant expertise in assets of the type that suffered the Loss Event (an “Appraisal Firm”) who will be engaged to determine the amount of Restoration Cost for such Loss Event. If the Parties are unable to agree upon an Appraisal Firm by the expiration of 15 days following the delivery of the Loss Event Notice, each of Seller, on the one hand, and Buyer, on the other hand, will select a separate Appraisal Firm to determine the Restoration Cost. If the two Appraisal Firms so selected do not agree on the Restoration Cost, then the two Appraisal Firms will select a third Appraisal Firm to determine the Restoration Cost. The final Restoration Cost will be the average of the two Restoration Cost estimates that are the closest in amount relative to each other. Each Party will use its Commercially Reasonable Efforts to cause any Appraisal Firm engaged by such party in accordance with this Section 5.12(a) to return its determination of the Restoration Cost within 30 days after the date of such appraiser’s engagement by such Party; provided that neither Party may delay the Closing for the time periods set forth in this Section 5.12(a) for the determination of the Restoration Cost unless such Party, upon delivery of a Loss Event Notice, believes in good faith that the amount of the aggregate Restoration Cost for such Casualty Loss is equal to or exceeds $8,250,000; provided further, that if Closing occurs prior to determination of the Restoration Cost by the Appraisal Firm(s), the Restoration Cost used at Closing shall be Buyer’s good faith estimate of the Restoration Cost (the “Estimated Restoration Cost”) and after the determination of the Restoration Cost by the Appraisal Firm(s) (the “Appraised Restoration Cost”) is made, if the Estimated Restoration Cost is less than the Appraised Restoration Cost, then Seller shall promptly pay to Buyer the amount of such difference and if the Appraised Restoration Cost is less than the Estimated Restoration Cost, Buyer shall promptly pay to Seller the amount of such difference. (b) Subject to Section 5.12(c) and Section 5.12(d), in the event of any such Loss Event, at the Closing, the Company and Seller will promptly pay to Buyer all sums paid to Seller or its Affiliates by any insurance company or other Person for the Restoration Cost of the Loss Event. (c) In the event of a Loss Event after the Execution Date but prior to the Closing involving an aggregate Restoration Cost that is greater than $3,300,000 but less than $30,525,000, Seller and Buyer will proceed with the Closing but the Base Consideration will be adjusted downward by the estimated Restoration Cost (as determined pursuant to Section 5.12(a)) for such Loss Event; provided that, in such case, to the extent that the Base Consideration is so reduced, all insurance proceeds (other than for business interruption, if any) or condemnation awards received by Seller, the Company or their respective Affiliates, with respect to such Loss Event, whether before or after the Closing, will be retained by or promptly paid to Seller upon receipt, notwithstanding anything to the contrary in Section 5.12(b). (d) If after the Execution Date but prior to the Closing, there is a Loss Event and the aggregate Restoration Cost is greater than $30,525,000 as established in accordance with Section 5.12(a), either Seller or Buyer may elect to terminate this Agreement by giving 5 days’ prior written notice to the other Party; provided, that Seller shall not be entitled to terminate this Agreement in accordance with this Section 5.12(d) if Buyer agrees to proceed with the Closing and in such case the Base Consideration will be reduced by only $30,525,000 notwithstanding the fact that the Restoration Cost in respect of such Loss Event is greater than $30,525,000 (and, for the avoidance of doubt, Seller shall have no responsibility under this Agreement or otherwise for such excess amount), and in such a case insurance proceeds shall be paid as set forth in the immediately following sentence. If neither Party exercises such right to terminate or if Buyer agrees to proceed with the Closing in accordance with the proviso to the foregoing sentence, then Seller and Buyer will proceed with the Closing but the Base Consideration will be adjusted downward by (i) the estimated Restoration Cost for such Loss Event (as determined pursuant to Section 5.12(a)) or (ii) if Buyer agrees to proceed with the Closing in accordance with the proviso to the foregoing sentence, $30,525,000 (as applicable); provided that, in such case, to the extent the Base Consideration is so reduced, all insurance proceeds (other than proceeds from business interruption insurance, if any) or condemnation awards received by Seller, the Company or their respective Affiliates, with respect to such Loss Event, whether before or after the Closing, will be retained by or promptly paid to Seller upon receipt, notwithstanding anything to the contrary in Section 5.12(b), up to the amount of the Restoration Cost, provided that, if Buyer agrees to proceed with the Closing in accordance with the proviso to the foregoing sentence, Buyer shall be entitled to any such insurance proceeds and condemnation awards received by Seller, the Company or their respective Affiliates in excess of $30,525,000 in an amount equal to the Restoration Cost minus $30,525,000; provided, however, all insurance proceeds, if any, from business interruption or other similar insurance received by Seller, the Company or their respective Affiliates, with respect to such Loss Event, whether before or after the Closing, shall be promptly paid to Buyer. (e) The occurrence of a Loss Event after the Execution Date but prior to the Closing will not, in and of itself, be deemed a breach of Seller’s representations and warranties, covenants or other obligations under this Agreement absent some other breach of Seller’s representations and warranties, covenants or other obligations under this Agreement. An election by either Party to exercise its right pursuant to Section 5.12(d) to terminate this Agreement will not, in and of itself, result in any breach of any representation, warranty or covenant of such Party under this Agreement. (f) In the event of any Loss Event, Seller and Buyer agree, as applicable, to use Commercially Reasonable Efforts and, if applicable, to cause the Company to use Commercially Reasonable Efforts, to pursue claims and collect any amounts to which the Company may be entitled under the applicable insurance policies or condemnation awards in respect of such Loss Event.

Loss Events. (a) If, after the Execution Date but prior to the Closing, all or any portion of the Company Assets are destroyed or damaged by fire, flood, earthquake, storm, theft, vandalism, explosion, blowout, riot, sabotage, accident or other casualty of a similar nature and the aggregate amount of the reasonably estimated Restoration Cost in respect thereof exceeds $100,000 (a “Casualty Loss”) or is taken in condemnation or under right of eminent domain and the aggregate amount of the reasonably estimated Restoration Cost in respect thereof exceeds $100,000 (a “Takings Loss” and together with a Casualty Loss, a “Loss Event”), Seller will promptly send notice to Buyer of the occurrence of such event (a “Loss Event Notice”) and provide Buyer with all reasonably requested information with respect thereto, including allowing Buyer and its Representatives to visit and survey the damage resulting therefrom. If either Party believes in good faith that the amount of the aggregate Restoration Cost for such Loss Events is equal to or exceeds $3,300,0002,000,000, the Parties will together promptly select an independent third-party appraiser with relevant expertise in assets of the type that suffered the Loss Event (an “Appraisal Firm”) who will be engaged to determine the amount of Restoration Cost for such Loss Event. If the Parties are unable to agree upon an Appraisal Firm by the expiration of 15 days following the delivery of the Loss Event Notice, each of Seller, on the one hand, and Buyer, on the other hand, will select a separate Appraisal Firm to determine the Restoration Cost. If the two Appraisal Firms so selected do not agree on the Restoration Cost, then the two Appraisal Firms will select a third Appraisal Firm to determine the Restoration Cost. The final Restoration Cost will be the average of the two Restoration Cost estimates that are the closest in amount relative to each other. Each Party will use its Commercially Reasonable Efforts to cause any Appraisal Firm engaged by such party in accordance with this Section 5.12(a) to return its determination of the Restoration Cost within 30 days after the date of such appraiser’s engagement by such Party; provided that neither Party may delay the Closing for the time periods set forth in this Section 5.12(a) for the determination of the Restoration Cost unless such Party, upon delivery of a Loss Event Notice, believes in good faith that the amount of the aggregate Restoration Cost for such Casualty Loss is equal to or exceeds $8,250,0005,000,000; provided further, that if Closing occurs prior to determination of the Restoration Cost by the Appraisal Firm(s), the Restoration Cost used at Closing shall be Buyer’s good faith estimate of the Restoration Cost (the “Estimated Restoration Cost”) and after the determination of the Restoration Cost by the Appraisal Firm(s) (the “Appraised Restoration Cost”) is made, if the Estimated Restoration Cost is less than the Appraised Restoration Cost, then Seller shall promptly pay to Buyer the amount of such difference and if the Appraised Restoration Cost is less than the Estimated Restoration Cost, Buyer shall promptly pay to Seller the amount of such difference. (b) Subject to Section 5.12(c) and Section 5.12(d), in the event of any such Loss Event, at the Closing, the Company and Seller will promptly pay to Buyer all sums paid to Seller or its Affiliates by any insurance company or other Person for the Restoration Cost of the Loss Event. (c) In the event of a Loss Event after the Execution Date but prior to the Closing involving an aggregate Restoration Cost that is greater than $3,300,000 2,000,000 but less than $30,525,00013,000,000, Seller and Buyer will proceed with the Closing but the Base Consideration will be adjusted downward by the estimated Restoration Cost (as determined pursuant to Section 5.12(a)) for such Loss Event; provided that, in such case, to the extent that the Base Consideration is so reduced, all insurance proceeds (other than for business interruption, if any) or condemnation awards received by Seller, the Company or their respective Affiliates, with respect to such Loss Event, whether before or after the Closing, will be retained by or promptly paid to Seller upon receipt, notwithstanding anything to the contrary in Section 5.12(b). (d) If after the Execution Date but prior to the Closing, there is a Loss Event and the aggregate Restoration Cost is equal to or greater than $30,525,000 13,000,000 as established in accordance with Section 5.12(a), either Seller or Buyer may elect to terminate this Agreement by giving 5 days’ prior written notice to the other Party; provided, that Seller shall not be entitled to terminate this Agreement in accordance with this Section 5.12(d) if Buyer agrees to proceed with the Closing and in such case the Base Consideration will be reduced by only $30,525,000 13,000,000 notwithstanding the fact that the Restoration Cost in respect of such Loss Event is greater than $30,525,000 13,000,000 (and, for the avoidance of doubt, Seller shall have no responsibility under this Agreement or otherwise for such excess amount), and in such a case insurance proceeds shall be paid as set forth in the immediately following sentence. If neither Party exercises such right to terminate or if Buyer agrees to proceed with the Closing in accordance with the proviso to the foregoing sentence, then Seller and Buyer will proceed with the Closing but the Base Consideration will be adjusted downward by (i) the estimated Restoration Cost for such Loss Event (as determined pursuant to Section 5.12(a)) or (ii) if Buyer agrees to proceed with the Closing in accordance with the proviso to the foregoing sentence, $30,525,000 13,000,000 (as applicable); provided that, in such case, to the extent the Base Consideration is so reduced, all insurance proceeds (other than proceeds from business interruption insurance, if any) or condemnation awards received by Seller, the Company or their respective Affiliates, with respect to such Loss Event, whether before or after the Closing, will be retained by or promptly paid to Seller upon receipt, notwithstanding anything to the contrary in Section 5.12(b), up to the amount of the Restoration Cost, provided that, if Buyer agrees to proceed with the Closing in accordance with the proviso to the foregoing sentence, Buyer shall be entitled to any such insurance proceeds and condemnation awards received by Seller, the Company or their respective Affiliates in excess of $30,525,000 13,000,000 in an amount equal to the Restoration Cost minus $30,525,00013,000,000; provided, however, all insurance proceeds, if any, from business interruption or other similar insurance received by Seller, the Company or their respective Affiliates, with respect to such Loss Event, whether before or after the Closing, shall be promptly paid to Buyer. (e) The occurrence of a Loss Event after the Execution Date but prior to the Closing will not, in and of itself, be deemed a breach of Seller’s representations and warranties, covenants or other obligations under this Agreement absent some other breach of Seller’s representations and warranties, covenants or other obligations under this Agreement. An election by either Party to exercise its right pursuant to Section 5.12(d) to terminate this Agreement will not, in and of itself, result in any breach of any representation, warranty or covenant of such Party under this Agreement. (f) In the event of any Loss Event, Seller and Buyer agree, as applicable, to use Commercially Reasonable Efforts and, if applicable, to cause the Company to use Commercially Reasonable Efforts, to pursue claims and collect any amounts to which the Company may be entitled under the applicable insurance policies or condemnation awards in respect of such Loss Event.

Loss Events. (a) If, after the Execution Date but prior to the Closing, all or any portion of the Company Assets are destroyed or damaged by fire, flood, earthquake, storm, theft, vandalism, explosion, blowout, riot, sabotage, accident or other casualty of a similar nature and the aggregate amount of the reasonably estimated Restoration Cost in respect thereof exceeds $100,000 (a “Casualty Loss”) or is taken in condemnation or under right of eminent domain and the aggregate amount of the reasonably estimated Restoration Cost in respect thereof exceeds $100,000 (a “Takings Loss” and together with a Casualty Loss, a “Loss Event”), Seller will promptly send notice to Buyer of the occurrence of such event (a “Loss Event Notice”) and provide Buyer with all reasonably requested information with respect thereto, including allowing Buyer and its Representatives to visit and survey the damage resulting therefrom. If either Party believes in good faith that the amount of the aggregate Restoration Cost for such Loss Events is equal to or exceeds $3,300,000700,000, the Parties will together promptly select an independent third-party appraiser with relevant expertise in assets of the type that suffered the Loss Event (an “Appraisal Firm”) who will be engaged to determine the amount of Restoration Cost for such Loss Event. If the Parties are unable to agree upon an Appraisal Firm by the expiration of 15 days following the delivery of the Loss Event Notice, each of Seller, on the one hand, and Buyer, on the other hand, will select a separate Appraisal Firm to determine the Restoration Cost. If the two Appraisal Firms so selected do not agree on the Restoration Cost, then the two Appraisal Firms will select a third Appraisal Firm to determine the Restoration Cost. The final Restoration Cost will be the average of the two Restoration Cost estimates that are the closest in amount relative to each other. Each Party will use its Commercially Reasonable Efforts to cause any Appraisal Firm engaged by such party in accordance with this Section 5.12(a) to return its determination of the Restoration Cost within 30 days after the date of such appraiser’s engagement by such Party; provided that neither Party may delay the Closing for the time periods set forth in this Section 5.12(a) for the determination of the Restoration Cost unless such Party, upon delivery of a Loss Event Notice, believes in good faith that the amount of the aggregate Restoration Cost for such Casualty Loss is equal to or exceeds $8,250,0001,750,000; provided further, that if Closing occurs prior to determination of the Restoration Cost by the Appraisal Firm(s), the Restoration Cost used at Closing shall be Buyer’s good faith estimate of the Restoration Cost (the “Estimated Restoration Cost”) and after the determination of the Restoration Cost by the Appraisal Firm(s) (the “Appraised Restoration Cost”) is made, if the Estimated Restoration Cost is less than the Appraised Restoration Cost, then Seller shall promptly pay to Buyer the amount of such difference and if the Appraised Restoration Cost is less than the Estimated Restoration Cost, Buyer shall promptly pay to Seller the amount of such difference. (b) Subject to Section 5.12(c) and Section 5.12(d), in the event of any such Loss Event, at the Closing, the Company and Seller will promptly pay to Buyer all sums paid to Seller or its Affiliates by any insurance company or other Person for the Restoration Cost of the Loss Event. (c) In the event of a Loss Event after the Execution Date but prior to the Closing involving an aggregate Restoration Cost that is greater than $3,300,000 700,000 but less than $30,525,0006,475,000, Seller and Buyer will proceed with the Closing but the Base Consideration will be adjusted downward by the estimated Restoration Cost (as determined pursuant to Section 5.12(a)) for such Loss Event; provided that, in such case, to the extent that the Base Consideration is so reduced, all insurance proceeds (other than for business interruption, if any) or condemnation awards received by Seller, the Company or their respective Affiliates, with respect to such Loss Event, whether before or after the Closing, will be retained by or promptly paid to Seller upon receipt, notwithstanding anything to the contrary in Section 5.12(b). (d) If after the Execution Date but prior to the Closing, there is a Loss Event and the aggregate Restoration Cost is greater than $30,525,000 6,475,000 as established in accordance with Section 5.12(a), either Seller or Buyer may elect to terminate this Agreement by giving 5 days’ prior written notice to the other Party; provided, that Seller shall not be entitled to terminate this Agreement in accordance with this Section 5.12(d) if Buyer agrees to proceed with the Closing and in such case the Base Consideration will be reduced by only $30,525,000 6,475,000 notwithstanding the fact that the Restoration Cost in respect of such Loss Event is greater than $30,525,000 6,475,000 (and, for the avoidance of doubt, Seller shall have no responsibility under this Agreement or otherwise for such excess amount), and in such a case insurance proceeds shall be paid as set forth in the immediately following sentence. If neither Party exercises such right to terminate or if Buyer agrees to proceed with the Closing in accordance with the proviso to the foregoing sentence, then Seller and Buyer will proceed with the Closing but the Base Consideration will be adjusted downward by (i) the estimated Restoration Cost for such Loss Event (as determined pursuant to Section 5.12(a)) or (ii) if Buyer agrees to proceed with the Closing in accordance with the proviso to the foregoing sentence, $30,525,000 6,475,000 (as applicable); provided that, in such case, to the extent the Base Consideration is so reduced, all insurance proceeds (other than proceeds from business interruption insurance, if any) or condemnation awards received by Seller, the Company or their respective Affiliates, with respect to such Loss Event, whether before or after the Closing, will be retained by or promptly paid to Seller upon receipt, notwithstanding anything to the contrary in Section 5.12(b), up to the amount of the Restoration Cost, provided that, if Buyer agrees to proceed with the Closing in accordance with the proviso to the foregoing sentence, Buyer shall be entitled to any such insurance proceeds and condemnation awards received by Seller, the Company or their respective Affiliates in excess of $30,525,000 6,475,000 in an amount equal to the Restoration Cost minus $30,525,0006,475,000; provided, however, all insurance proceeds, if any, from business interruption or other similar insurance received by Seller, the Company or their respective Affiliates, with respect to such Loss Event, whether before or after the Closing, shall be promptly paid to Buyer. (e) The occurrence of a Loss Event after the Execution Date but prior to the Closing will not, in and of itself, be deemed a breach of Seller’s representations and warranties, covenants or other obligations under this Agreement absent some other breach of Seller’s representations and warranties, covenants or other obligations under this Agreement. An election by either Party to exercise its right pursuant to Section 5.12(d) to terminate this Agreement will not, in and of itself, result in any breach of any representation, warranty or covenant of such Party under this Agreement. (f) In the event of any Loss Event, Seller and Buyer agree, as applicable, to use Commercially Reasonable Efforts and, if applicable, to cause the Company to use Commercially Reasonable Efforts, to pursue claims and collect any amounts to which the Company may be entitled under the applicable insurance policies or condemnation awards in respect of such Loss Event.