GAAP Loss Sample Clauses

GAAP Loss. Notwithstanding anything else contained in this Agreement, in no event shall Optionor be required to sell the Option Property to Optionee pursuant to a Purchase Option if such transaction will result in a “GAAP Loss” (as defined below) to Optionor. In the event that the Option Purchase Price would cause Optionor to have a GAAP Loss, Optionor shall have the right, in Optionor’s sole discretion, to terminate the applicable Purchase Option. A “GAAP Loss” shall mean that the net proceeds (after payment of all closing costs and other expenses) that would be received by Optionor from a sale of the Option Property to Optionee for the Option Purchase Price are less than the historical cost basis of Optionor in the Option Property, as determined in accordance with generally accepted accounting principles, provided that “historical cost” will include depreciation/amortization taken up to the date of the sale (such historical cost basis to be known as the “GAAP Basis”). In the event the Option Property is Phase I only, the determination of GAAP Loss will take into consideration an equitable allocation of acquisition and operational costs and expenses between Phase I and Phase II (the “Phase I/Phase II Allocation”). Optionor agrees that not later than December 31, 2004, Optionor shall deliver to Optionee, Optionor’s preliminary GAAP Basis analysis, as of a date no earlier than July 31, 2003, together with reasonable supporting evidence with respect thereto (the “Preliminary GAAP Notice”). Optionee shall then have a period of one hundred eighty (180) days following receipt of the Preliminary GAAP Notice, upon not less than fifteen (15) business days prior written notice, to commence an audit of Optionor’s books and records for the Project conducted by an independent certified accountant licensed in the State California, selected by Optionee, and that shall meet the same qualification required of the arbitrators in Section 3.3.2 below, for the purpose of verifying the calculation of the GAAP Basis set forth in Optionor’s Preliminary GAAP Notice. Optionor shall make available to the auditor, in a location in Los Angeles County, California, within fifteen (15) business days following selection of the auditor, all books and records of Optionor for the Project which are reasonably necessary for purposes of performing such audit, as reasonably determined by the auditor. The preceding audit shall be a one-time right, and Optionor shall not be required to -10- XXXXXXXXXX XXXX ...