Purchase Shortfall Clause Samples
A Purchase Shortfall clause defines the consequences and remedies if a buyer fails to purchase a minimum agreed quantity of goods or services within a specified period. Typically, this clause outlines the minimum purchase requirements, the method for calculating any shortfall, and the penalties or compensation owed by the buyer if the threshold is not met. Its core function is to protect the seller from revenue loss due to under-purchasing and to ensure predictability in sales volumes.
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Purchase Shortfall. Halliburton shall have *** (***) months after the month of the Purchase Shortfall to purchase tonnage of Northern White frac sand in excess of the applicable Monthly Minimum Requirement to make up for the Purchase Shortfall. If Halliburton fails to purchase the full amount of the Purchase Shortfall in such *** (***) month period, Halliburton shall be obligated to pay to Supplier an amount equal to the amount of the Purchase Shortfall not purchased by Halliburton in such *** (***) month period (expressed in tons) multiplied by $*** (the “Makewhole Payment”). The Makewhole Payment shall be paid within *** days of written demand by Supplier, by wire transfer of immediately available funds to the account designated in writing by Supplier. Halliburton reserves the right to resell goods purchased from Supplier if deemed necessary by Halliburton in order to satisfy the Minimum Purchase Requirement or, if applicable, the Adjusted Minimum Purchase Requirement. Supplier shall not be obligated to deliver more than the Monthly Maximum Supply Availability on any given calendar month. Notwithstanding the foregoing, in the event that a Contract Year is deemed a POD Adjustment Year, then the Monthly Minimum Requirement for such POD Adjustment Year shall be adjusted to be an amount equal to one twelfth (1/12) of the Adjusted Minimum Purchase Requirement (the “Adjusted Monthly Minimum Requirement”) and any Makewhole Payments actually paid by Halliburton to Supplier that would otherwise not have been paid by Halliburton to Supplier as a result of using the Adjusted Monthly Minimum Requirement and not the Monthly Minimum Requirement to determine the Purchase Shortfall shall be credited by Supplier to Halliburton for purchases hereunder.
Purchase Shortfall. If Gavilon fails to purchase and take delivery of any quantities of Product specified in Confirmed Orders, and Producer after using commercially reasonable efforts to mitigate any damage, has produced and must sell such Product to a substitute purchaser at a price lower than the applicable Price, Gavilon shall pay Producer the amount by which the applicable Price exceeds the actual sales price per ton, multiplied by the number of tons sold to the substitute purchaser. If Producer exercises commercially reasonable efforts and is still unable to sell any such Product to a substitute purchaser, then Gavilon shall pay Producer an amount equal to the Price multiplied by the entire unsold portion. Gavilon shall remit payment within five (5) business days following the invoice date and receipt of supporting documentation. In either case, Gavilon shall also pay any additional costs solely and directly incurred by Producer to identify a substitute purchaser, to store the Product until they can be sold or disposed of, or to dispose of the Product. Except for remedies set forth elsewhere in this Agreement, the remedy specified in this Section 4.2 shall be Producer’s sole and exclusive remedy in the event Gavilon fails to purchase and take delivery of the Product specified in the Confirmed Order.
Purchase Shortfall. If Purchaser fails to purchase and take delivery of any quantities of Biodiesel specified in Confirmed Orders, and Seller, using commercially reasonable efforts to mitigate any damage, has produced and must sell such Biodiesel to a substitute purchaser at a price lower than the applicable Price, Purchaser shall pay Seller the amount by which the Price exceeds the actual sales price per gallon, multiplied by the number of gallons sold to the substitute purchaser. If Seller exercises commercially reasonable efforts and is still unable to sell any such Biodiesel to a substitute purchaser, then Purchaser shall pay Seller an amount equal to the Price multiplied by the entire unsold portion. Purchaser shall remit payment within 15 days of receiving an invoice from Seller. In either case, Purchaser shall also pay any additional costs solely and directly incurred by Seller to identify a substitute purchaser. The remedy specified in this Section 4.2 shall be Seller’s sole and exclusive remedy in the event Purchaser fails to purchase and take delivery of the Biodiesel specified in the Confirmed Order.
Purchase Shortfall. In the event Buyer fails to purchase and remove [***] of Product in accordance with the terms of a Confirmed Order for any reason (a “Buyer Shortfall Volume”), Seller shall have the right to sell the Buyer Shortfall Volume to any third party and Buyer shall reimburse Seller for Seller’s Cover Damages (as hereafter defined), if any, incurred as a result of Buyer’s failure to purchase and receive Product, unless such failure was due to an event of Force Majeure. “Seller’s Cover Damages” shall be equal to [***].
Purchase Shortfall. Within ten (10) days after Buyer’s receipt from Seller of a notice or audit report identifying a Shortfall, Buyer shall, at its option, (i) elect to purchase a quantity of Aggregates equal to that deficiency in the succeeding Contract Year (provided that this option shall not be available to Buyer if the Shortfall occurred or was identified in an audit during the final Contract Year) in addition to the minimum quantity required to be purchased by Buyer under this Agreement in such succeeding Contract Year, or (ii) pay Seller as liquidated damages due to such Shortfall an amount equal to twenty percent (20%) of the price for Aggregates as of the end of the Contract Year in which such Shortfall occurred multiplied by the number of tons of the Shortfall in such Contract Year. If option (i) is exercised and Buyer fails to purchase the amount of Aggregates required in the succeeding Contract Year, Buyer shall pay to Seller at the end of such succeeding Contract Year an amount equal to twenty percent (20%) of the price for Aggregates as of the end of such succeeding Contract Year multiplied by the number of tons which Buyer failed to purchase during such succeeding Contract Year, plus interest on such amount at the rate set forth in Section 4.3 above from the beginning of such succeeding Contract Year until paid. If option (i) is exercised and a Force Majeure event affecting Seller prevents Buyer from purchasing all of the Aggregates required to complete option (i), then the time period for Buyer’s compliance with option (i) shall be extended by the length of time such Force Majeure event lasts.