Loss Proceeds Clause Samples
The Loss Proceeds clause defines how any insurance or compensation payments received as a result of damage or loss to property are to be handled between the parties. Typically, it specifies who is entitled to receive the proceeds, how the funds should be applied—such as toward repair, replacement, or repayment of outstanding obligations—and under what circumstances the proceeds may be distributed differently. This clause ensures that there is a clear and agreed-upon process for managing insurance payouts, thereby preventing disputes and ensuring that the interests of all parties are protected in the event of a loss.
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Loss Proceeds. In the event of a casualty to the Property, unless Lender elects, or is required pursuant to Article III hereof to make all of the Insurance Proceeds available to Borrower for restoration, Lender and Borrower shall cause all such Insurance Proceeds to be paid by the insurer directly to the Central Account, whereupon Lender shall, after deducting Lender’s costs of recovering and paying out such Insurance Proceeds, including without limitation, reasonable attorneys’ fees, apply same to reduce the Debt in accordance with the terms of the Note; provided, however, that if Lender elects, or is deemed to have elected, to make the Insurance Proceeds available for restoration, all Insurance Proceeds in respect of rent loss, business interruption or similar coverage shall be maintained in the Central Account, to be applied by Lender in the same manner as Rent received with respect to the operation of the Property; provided, further, however, that in the event that the Insurance Proceeds with respect to such rent loss, business interruption or similar insurance policy are paid in a lump sum in advance, Lender shall hold such Insurance Proceeds in a segregated interest-bearing escrow account, which shall be an Eligible Account, shall estimate, in Lender’s reasonable discretion, the number of months required for Borrower to restore the damage caused by the casualty, shall divide the aggregate rent loss, business interruption or similar Insurance Proceeds by such number of months, and shall disburse from such bank account into the Central Account each month during the performance of such restoration such monthly installment of said Insurance Proceeds minus, if the sum which otherwise would be required to be deposited into the Operation and Maintenance Expense Sub-Account if a Default Management Period existed, which sum shall be remitted by Lender to Manager to pay Operating Expenses. In the event that Insurance Proceeds are to be applied toward restoration, Lender shall hold such funds in a segregated bank account at the Bank, which shall be an Eligible Account, and shall disburse same in accordance with the provisions of Section 3.04 hereof. Unless Lender elects, or is required pursuant to Section 6.01 hereof to make all of the Condemnation Proceeds available to Borrower for restoration, Lender and Borrower shall cause all such Condemnation Proceeds to be paid to the Central Account, whereupon Lender shall, after deducting Lender’s costs of recovering and paying out s...
Loss Proceeds. So long as no Event of Default has occurred and is continuing, any proceeds of insurance on or condemnation of Collateral shall, at Borrower’s election and so long as Lender’s security interest in such proceeds remains first priority, be used either to repair or replace such Collateral or otherwise applied to the purchase or acquisition of property useful to Borrower’s business.
Loss Proceeds. (a) The Agency and the Lessee shall cooperate and consult with each other in all matters pertaining to the settlement, compromise, arbitration or adjustment of any claim or demand on account of any Loss Event, and the settlement, compromise, arbitration or adjustment of any such claim or demand shall, as between the Agency and the Lessee, be subject to the written approval of the Lessee.
(b) The Lessee shall be entitled to the Net Proceeds of any insurance proceeds or condemnation award, compensation or damages attributable to the Lessee’s Property, provided that nothing contained in this Agreement shall be deemed to modify the obligations of the Lessee pursuant to any Mortgage with respect to property insurance proceeds and condemnation awards. The obligations of the Lessee hereunder shall be independent of any such other obligations relating to insurance proceeds and condemnation awards.
Loss Proceeds. In the event of a casualty or Taking with respect to the Property, unless pursuant to Section 5.1(x) of this Agreement or applicable law, the Loss Proceeds are to be made available to Borrower for restoration or to the tenants, all of Borrower’s interest in Loss Proceeds shall be paid directly to the Collection Account to satisfy the requirements of Section 3.7(b). If the Loss Proceeds are to be made available for restoration pursuant to this Agreement or to the tenants pursuant to applicable law, such Loss Proceeds shall be held by the Collateral Agent in a segregated interest-bearing Eligible Account in the name of the Collateral Agent on behalf of the Lenders to be opened by the Collateral Agent within three (3) Business Days after the Collateral Agent receives written notice of the necessity therefor from the Agent, to be withdrawn by the Collateral Agent and held uninvested in a LaSalle Bank National Association account from the Business Day immediately preceding the date upon which payment to Borrower or to the tenants is to be made to such payment date for delivery to Borrower or to the tenants from time to time to pay restoration costs pursuant to a schedule reasonably acceptable to Agent and Borrower. Funds on deposit in any such account opened by the Collateral Agent shall be invested in Permitted Investments in the same manner and subject to the same restrictions as set forth in Section 3.12(c) with respect to the Collection Account (except that the maturity shall be not later than as necessary to satisfy the schedule referred to in the preceding sentence). If any Loss Proceeds are received by Borrower, such Loss Proceeds shall be received in trust for the Lenders, shall be segregated from other funds of Borrower, and shall be forthwith paid to Collateral Agent to the extent necessary to comply with this Agreement.
Loss Proceeds. Within five Business Days after financial statements have been delivered pursuant to Section 6.01(a), the Borrower shall prepay an aggregate principal amount of Loans in an amount equal to 100% of the excess (if any) of (A) Available Loss Proceeds for the immediately preceding fiscal year, less (B) the amount of any voluntary prepayments of the Term Loans during such prior fiscal year; provided, however, that, notwithstanding the forgoing, within two (2) Business Days of receipt of Loss Proceeds from any single casualty or taking, or series of related casualties or takings, in excess of the Threshold Amount, the Borrower shall prepay the Loans and/or Cash Collateralize the L/C Obligations in an aggregate amount equal to 100% of such Loss Proceeds.
Loss Proceeds. Upon the occurrence of a Casualty Event or an Event of Eminent Domain, the Borrower shall prepay an aggregate principal amount of the Loans in an aggregate amount equal to the Net Cash Proceeds thereof; provided, the Net Cash Proceeds of the a Casualty Event or an Event of Eminent Domain shall not be required to be immediately prepaid in the event such proceeds are applied in accordance with Section 2.14(e). Each such prepayment of the Loans shall be applied (i) to the scheduled principal payments of the Loans in inverse order of maturity in respect of each Facility and (ii) first, to the prepayment of Term A Loans in full in Cash, including the principal amount due on the Maturity Date and second, to the prepayment of Term B Loans in full in Cash, including the principal amount due on the Maturity Date.
Loss Proceeds. In the event of a casualty or Taking with respect to the Mortgaged Property, unless pursuant to Section 5.1(x) of this Agreement, the Loss Proceeds are to be made available to Borrower for Restoration, all of Borrower’s interest in Loss Proceeds shall be paid directly to the Collection Account. If the Loss Proceeds are to be made available for Restoration pursuant to this Agreement, such Loss Proceeds shall be held by Lender in a segregated interest-bearing Eligible Account in the name of Lender and under the sole dominion and control of Lender to be opened (if not previously opened and maintained by the Collection Account Bank under the Collection Account Agreement by the Lender) by Lender at a financial institution selected by Lender (the “Loss Proceeds Account”). Funds on deposit in the Loss Proceeds Account shall be invested in Permitted Investments in the same manner and subject to the same restrictions as set forth in Section 2.12(c) with respect to the Collection Account (except that the maturity shall be not later than as necessary to satisfy any schedule of distributions for Restoration required or approved by Lender). If any Loss Proceeds are received by Borrower, such Loss Proceeds shall be received in trust for Lender, shall be segregated from other funds of Borrower, and shall be forthwith paid to Lender to the extent necessary to comply with this Agreement.
Loss Proceeds. In the event of a casualty or Taking with respect to an Individual Property and unless pursuant to the Related Mortgage the proceeds, net of Borrower's reasonable collection costs approved by Lender, received under any insurance policy required to be maintained by Borrower ("Insurance Proceeds") or the proceeds, net of Borrower's reasonable collection costs approved by Lender, in respect of any Taking ("Condemnation Proceeds"), as the case may be, are to be made available to Borrower for restoration, Lender and Borrower shall cause all such Insurance Proceeds or Condemnation Proceeds (collectively, "Loss Proceeds") to be paid directly to the Cash Collateral Account whereupon Lender or Servicer, as the case may be, shall apply same to reduce the Indebtedness in accordance with Section 2.7(b). If Lender agrees or is required pursuant to the provisions hereof or of the Related Mortgage to make Loss Proceeds available for restoration, (i) all Insurance Proceeds received in respect of business interruption coverage and (ii) any Condemnation Proceeds received in connection with a temporary Taking shall be maintained in the Cash Collateral Account, to be applied by Lender in the same manner as Rent received from Manager with respect to the operation of such Individual Property; provided, further, that in the event that the Insurance Proceeds of any such business interruption insurance policy or Condemnation Proceeds of such temporary Taking are paid in a lump sum in advance, Lender shall hold such Insurance Proceeds or
Loss Proceeds. (a) If a Loss Event, the restoration of which is reasonably estimated to cost $10,000,000 or more, has occurred and either (i) Borrower does not submit a Restoration Notice to Lender, Administrative Agent, Collateral Agent and Independent Engineer within 60 days (or, if reasonably requested by ▇▇▇▇▇▇▇▇ and consented to by Lender (such consent not to be unreasonably withheld or delayed), 90 days) of the occurrence of such Loss Event, or (ii) Borrower submits written notice to Lender, Collateral Agent and Administrative Agent that Borrower has determined not to take any Restoration Action in connection with such Loss Event, then Borrower shall, within five Business Days of receipt of Loss Proceeds in connection with such Loss Event, apply such Loss Proceeds to the mandatory prepayment of the Loans in accordance with Section 2.1.6(c)(ii).
(b) If Borrower receives Loss Proceeds in connection with a Total Loss, then Borrower shall, within five Business Days of receipt of such Loss Proceeds, apply such Loss Proceeds to the mandatory prepayment of the Loans in accordance with Section 2.1.6(c)(ii).
(c) If Borrower has submitted a Restoration Notice to Lender, Collateral Agent and Administrative Agent in connection with any Loss Event in the time periods provided in clause (a) above, then Borrower shall, within the latest of (A) 90 days of the occurrence of such Loss Event, (B) 60 days after Borrower receives the applicable Loss Proceeds related to such Loss Event, and (C) such other period as may be agreed in writing by ▇▇▇▇▇▇, submit to Lender, Collateral Agent, the Independent Engineer and Administrative Agent:
(i) a restoration plan prepared by ▇▇▇▇▇▇▇▇ describing in reasonable detail ▇▇▇▇▇▇▇▇’s plan for completing the Restoration Action described in such Restoration Notice (such plan, a “Restoration Plan”);
(ii) a Restoration Budget demonstrating the estimated cost to complete such Restoration Action does not exceed the sum of (A) the applicable Loss Proceeds, (B) proceeds of any Additional Equity Contributions reserved for Restoration Action, and (C) any additional Loss Proceeds anticipated to be received in respect of such Loss Event;
(iii) a Restoration Schedule demonstrating that such Restoration Action can be completed within 12 months after submission of the Restoration Notice; and
(iv) additional title insurance, title insurance endorsements, mechanic’s lien waivers, certificates, opinions or other matters as Lender may reasonably request to preserve or...
Loss Proceeds. All Loss Proceeds shall be applied as provided in this Section 5.15. All Loss Proceeds shall be paid by the relevant insurers, reinsurers and Governmental Authorities, as applicable, directly to Lender as loss payee and, if paid to a Borrower, such Loss Proceeds shall be received in trust and for the benefit of Lender segregated from other funds of such Borrower, and shall be forthwith paid over to Lender in the same form as received (with any necessary endorsement). Lender shall apply all such Loss Proceeds in accordance with the provisions of this Section 5.15.
(a) Upon the occurrence of any Casualty Event with respect to which Loss Proceeds are payable in respect of a single loss in an amount not in excess of $250,000, Lender will disburse such Loss Proceeds, to the extent Lender actually receives such Loss Proceeds, to Borrower upon written request by Borrowers and Borrowers shall apply, or cause to be applied, such Loss Proceeds to the payment of the costs of repair or restoration of the portion of the Funded Project lost or damaged; provided that any Loss Proceeds not applied within 180 days of disbursement by Lender to Borrowers shall be applied as a prepayment in accordance with Section 5.15(c).
(b) Upon the occurrence of any Casualty Event with respect to which Loss Proceeds are payable in respect of a single loss in an amount in excess of $250,000, disbursement of funds by Lender to Borrowers shall be permitted if, and only if, Lender shall have determined (in its reasonable discretion) that:
(i) repair or replacement of the relevant portion of the Funded Project is economically feasible; and
(ii) no Event of Default shall have occurred and be continuing at the time of disbursement.
(c) All Loss Proceeds not otherwise applied in accordance with clauses (a) or (b) of this Section 5.15, including, without limitation, due to the absence of required approval by Lender, shall be applied by Lender to the prepayment of Loans in accordance with Section 2.8(c) (and without any prepayment fee being charged).