Common use of Casualty or Condemnation Loss Clause in Contracts

Casualty or Condemnation Loss. (a) Notwithstanding anything herein to the contrary, from and after the Effective Time, Buyer shall assume all risk of loss with respect to production of Hydrocarbons through normal depletion (including watering out of any Well, collapsed casing or sand infiltration of any Well) and the depreciation of personal property due to ordinary wear and tear, in each case, with respect to the Assets. (b) Without limiting Buyer’s rights under Section 14.1(e), if, after the date of this Agreement but prior to the Closing Date, any portion of the Assets (including downhole) is destroyed by fire, windstorm or other casualty or is taken in condemnation or under right of eminent domain, and the aggregate amount of any such loss as a result of such casualty or taking exceeds fifteen percent (15%) of the Purchase Price, either party shall have the right to terminate this Agreement. If the aggregate amount of any such loss as a result of such casualty or taking exceeds fifteen percent (15%) of the Purchase Price and the parties nevertheless elect to proceed to closing, Seller shall elect by written notice to Buyer prior to Closing either (i) to cause the Assets affected by such casualty or taking to be repaired or restored to at least its condition prior to such casualty or taking, at Seller’s sole cost, as promptly as reasonably practicable (which work may extend after the Closing Date), or (ii) to treat such casualty or taking as a Title Defect with respect to the affected Asset or Assets under Section 11.