Common use of Significant Loss Damages Clause in Contracts

Significant Loss Damages. Purchaser shall be responsible for significant loss damages. Significant loss damages are damages that, for example, result from vandalism, theft, and/or destruction and are (i) greater than routine damages; and (ii) because of the estimated cost to repair/replace such damage, result in a total loss of the Goods (i.e., the cost to repair/replace the Goods is equal to or exceeds the replacement cost). (1) Contractor promptly will notify Purchaser of any significant loss damages and the estimated repair/replacement costs prior to repair/replacement. ▪ If the unit is deemed a total loss, Contractor’s total loss replacement fee, payable by Purchaser, shall be the unit’s cost, paid by Contractor at the time of acquisition. The cost shall not be adjusted upwards for a markup or downward for depreciation. Labor related to acquiring new unit, such as picking up from manufacturer or distributor, or any additional fees cannot be billed to the Purchaser. Contractor shall provide a copy of the unit’s invoice to the Purchaser at the time of invoicing for any total loss replacement fee. (2) Purchaser, within thirty (30) days, shall compensate Contractor as set forth herein for significant loss damages. ▪ If the unit is a total loss (e.g., the unit is stolen, destroyed, or the estimated cost to repair the damage equals or exceeds the unit replacement cost), Purchaser shall compensate Contractor for the unit replacement cost. ▪ If the damage to the unit is less than a total loss, but greater than routine damages, Purchaser shall compensate Contractor for the unit repair; Provided, however, that in no event shall such repair cost equal or exceed the unit replacement cost. Prior to repairing such unit, Contractor shall provide Purchaser with a repair estimate. (3) Contractor promptly shall replace any unit that is stolen, destroyed, or becomes unsuitable for use within 24 hours, unless otherwise agreed in writing by Purchaser and Contractor.