Common use of Shortfall Payments Clause in Contracts

Shortfall Payments. “Minimum Throughput Commitment” means the aggregate Stipulated Volume (on a Monthly average basis) in bpd as set forth for all Terminals on Schedule A attached hereto; provided however, that the Minimum Throughput Commitment during the Month in which the Commencement Date occurs shall be prorated in accordance with the ratio of the number of days including and following the Commencement Date in such Month to the total number of days in such Month. If during any Month during the Term, TRMC throughputs aggregate volumes greater than the Minimum Throughput Commitment, then TRMC shall pay TLO an amount equal to the weighted average of the amounts for each Terminal the volumes throughput by TRMC in excess of the Stipulated Volume for such Terminal multiplied by the Terminalling Service Fee paid by TRMC for that Terminal (the “Excess Amount”). If, during any Month during the Term, TRMC throughputs aggregate volumes less than the Minimum Throughput Commitment for such Month, then TRMC shall pay TLO an amount (a “Shortfall Payment”) for any shortfall. Shortfall Payments shall be equal to the weighted average of the amounts for each Terminal of the Terminalling Service Fee paid by TRMC during that Month and the monthly shortfall at that Terminal. The dollar amount of any Shortfall Payment paid by TRMC shall be posted as a credit to TRMC’s account and may be applied against any Excess Amounts owed by TRMC during any of the succeeding three (3) Months. For informational purposes only, attached as Exhibit 2 hereto is a sample calculation demonstrating the Shortfall Payment and its application. Credits will be applied in the order in which such credits accrue and any remaining portion of the credit that is not used by TRMC during the succeeding three (3) Months shall expire (e.g., a credit that accrues in January will be available in February, March and April, will expire at the end of April, and must be applied prior to applying any credit which accrues in February).

Shortfall Payments. (a) If a Shortfall exists for a Revenue Period, then within ten (10) days after receiving the Qualifying Revenue Report for the applicable Revenue Period (such tenth day is described herein as the “Minimum Throughput Commitment” means Shortfall Date”), SBEC shall pay to the aggregate Stipulated Volume Company an irrevocable and nonrefundable amount equal to the Shortfall (on the “Shortfall Payment”). SBEC shall receive a Monthly average basisnonrefundable credit in the amount of each Shortfall Payment received by the Company (whether from SBEC pursuant hereto or from SOFTBANK Corp. pursuant to the Release, Reimbursement and Payment Agreement dated as of the date hereof among the parties hereto and SOFTBANK Corp. (the “Release”)) as a credit to be applied to Qualifying Revenues paid to the Company for future Software product licenses (the “Shortfall Licenses”) purchased prior to the final Revenue Date by Alliance Partner(s) pursuant to (i) the Amended Master Alliance Agreement; or (ii) an Approved Purchase Agreement. Section 3(c) hereof, together with the last sentence of this Section 3(a), shall govern the application of such credits. For purposes of calculating Qualifying Revenues for each Revenue Period, any Revenue arising from Shortfall Licenses shall be considered as arising in bpd as set forth for all Terminals on Schedule A attached hereto; provided however, that the Minimum Throughput Commitment during the Month Revenue Period in which the Commencement Date occurs Shortfall resulting in such Shortfall Licenses occurred. For the avoidance of doubt, the parties acknowledge and agree that (i) SBEC shall not be entitled to a refund or to receive cash payment in lieu of credit against future Software product license fees or support fees, or to apply credits to any payments other than as expressly set forth in Section 3(c); (ii) all Shortfall Payments provided for hereunder must be made even if no modification, enhancement or other changes are made to the existing Software products and product suites as offered by the Company; (iii) without limiting any other obligations of SBEC set forth herein or otherwise or of any Alliance Partner, any Shortfall that has not been paid to the Company by March 31, 2004 shall be prorated paid within 30 days thereafter; and (iv) all credits towards Shortfall Licenses shall expire if not used prior to March 31, 2004. (b) For purposes of calculating the Qualifying Revenues and the Shortfall (if any) for any Revenue Period, Qualifying Revenues in accordance with yen during such Revenue Period shall be converted into U.S. Dollars at the ratio exchange rate determined as follows: the dollar/yen exchange rate to be used for such Revenue Period shall be set on the first business day of such Revenue Period and shall equal the average of the number of daily closing Japanese Yen Spot Prices as quoted by Bloomberg on each day during the twenty business days up to and including such first business day; provided that (i) if such average is lower than ¥100/$1 (e.g., ¥90/$1), then the exchange rate for such Revenue Period shall be ¥100/$1 and following (ii) if such average is higher than ¥144/$1 (e.g., ¥160/$1), then the Commencement Date exchange rate for such Revenue Period shall be ¥144/$1. (c) If, in such Month a Revenue Period, Company receives Qualifying Revenue pursuant to the total number Amended Master Alliance Agreement or an Approved Purchase Agreement in excess of days in the Revenue Target for such Month. If during any Month during the Term, TRMC throughputs aggregate volumes greater than the Minimum Throughput CommitmentRevenue Period, then TRMC within forty-five (45) days of Company’s receipt of payment in cash for the entire amount of Qualifying Revenue for such Revenue Period, Company shall pay TLO to SBEC, by wire transfer, an amount equal to the weighted average lesser of (a) the amounts for each Terminal amount by which the volumes throughput by TRMC in excess of the Stipulated Volume Qualifying Revenue for such Terminal multiplied by Revenue Period exceeds the Terminalling Service Fee paid by TRMC for that Terminal (the “Excess Amount”). If, during any Month during the Term, TRMC throughputs aggregate volumes less than the Minimum Throughput Commitment Revenue Target for such MonthRevenue Period and (b) the amount of Shortfall Credit existing at the beginning of such Revenue Period. Notwithstanding the foregoing, then TRMC the Company shall pay TLO an amount (a “Shortfall Payment”) not be required to make any cash payment due hereunder for any shortfall. Shortfall Payments shall be equal to Revenue Period unless the weighted average Company receives cash payment of the amounts all Qualifying Revenues for each Terminal of the Terminalling Service Fee paid by TRMC during that Month and the monthly shortfall at that Terminal. The dollar amount of any Shortfall Payment paid by TRMC shall be posted as a credit to TRMC’s account and may be applied against any Excess Amounts owed by TRMC during any of the succeeding three (3) Months. For informational purposes only, attached as Exhibit 2 hereto is a sample calculation demonstrating the Shortfall Payment and its application. Credits will be applied in the order in which such credits accrue and any remaining portion of the credit that is not used by TRMC during the succeeding three (3) Months shall expire (e.g., a credit that accrues in January will be available in February, March and April, will expire at Revenue Period within 60 days after the end of April, and must be applied prior to applying any credit which accrues in February)such Revenue Period.

Shortfall Payments. “Minimum Throughput Commitment” means the aggregate Stipulated Volume (on a Monthly average basis) in bpd as set forth for all Terminals on Schedule A attached hereto; provided however, that the Minimum Throughput Commitment during the Month in which the Commencement Date occurs shall be prorated in accordance with the ratio of the number of days including and following the Commencement Date in such Month to the total number of days in such Month. If during any Month during the Term, TRMC throughputs aggregate volumes greater than the Minimum Throughput Commitment, then TRMC shall pay TLO an amount equal to the weighted average of the amounts for each Terminal the volumes throughput by TRMC in excess of the Stipulated Volume for such Terminal multiplied by the Terminalling Service Fee paid by TRMC for that Terminal (the “Excess Amount”). If, during any Month during Contract Year, the Term, TRMC Company throughputs aggregate volumes less than the Minimum Throughput Commitment Commitment, as adjusted pursuant to Section 6.2, for such MonthContract Year (a “Shortfall”), then TRMC (in addition to Terminaling Service Fee) the Company shall pay TLO the Operator an amount (a “Shortfall Payment”) for any shortfall. Shortfall Payments shall be equal to the weighted average Terminaling Service Fee multiplied by the difference between (a) the Minimum Throughput Commitment and (b) the volume of Products actually delivered to the Terminal by the Company during the applicable Contract Year. Notwithstanding the foregoing, on a quarterly basis if the amount of revenue recognized under U.S. Generally Accepted Accounting Principles does not otherwise agree to the amount of revenue billed for such Contract Quarter, the Company shall prepay (a “Provisional Shortfall Payment”) an amount equal to the Terminaling Service Fee multiplied by the difference between (x) the Minimum Throughput Commitment and (y) the volume of Products actually delivered to the Terminal by the Company during such Contract Quarter. The Parties acknowledge and agree that Company shall be credited with all Provisional Shortfall Payments made during a Contract Year for purposes of determining whether there is a Shortfall Payment due for the Contract Year and shall be entitled to a refund of any amounts paid in excess of the amounts Shortfall Payment. With respect to Contract Year 2017, the Parties acknowledge and agree that Company shall be credited with all Shortfall Payments made prior to the date of this Amendment for each Terminal purposes of determining whether there is a Shortfall for such Contract Year. The Parties acknowledge and agree that there shall be no carry-over of deficiency volumes with respect to the Terminalling Service Fee paid by TRMC during that Month Minimum Throughput Commitment and the monthly shortfall at that Terminal. The dollar amount payment by the Company of any Shortfall Payment paid by TRMC shall be posted as a credit to TRMC’s account and may be applied against any Excess Amounts owed by TRMC during any of the succeeding three (3) Months. For informational purposes only, attached as Exhibit 2 hereto is a sample calculation demonstrating the Shortfall Payment and its application. Credits will be applied in shall relieve the order in which Company of any obligation to meet such credits accrue and any remaining portion Minimum Throughput Commitment for the relevant Contract Year.” (b) Effective as of the credit that date of this Amendment, Section 3.8 of the Agreement is not used by TRMC during deleted in its entirety and replaced with the succeeding three (3) Months shall expire (e.g., a credit that accrues in January will be available in February, March and April, will expire at the end of April, and must be applied prior to applying any credit which accrues in February).following: