OF LOSS SHALL TRANSFER TO
BUYER.
SELLER SHALL KEEP THE PROPERTY INSURED AGAINST LOSS OR DAMAGE IN
ACCORDANCE WITH ITS EXISTING INSURANCE COVERAGE UNTIL THE CLOSING.
IF BEFORE
THE CLOSING ANY LOSS OR OTHER CASUALTY OR ANY GOVERNMENTAL TAKING AFFECTS SOME
OR ALL OF THE PROPERTY, BUYER, AT ITS SOLE OPTION, MAY ELECT ANY OF THE
FOLLOWING OPTIONS:
(I)
IF PRIOR TO CLOSING, THE PROPERTY CAN BE REPAIRED, REPLACED OR
RESTORED TO THE CONDITION THE PROPERTY WAS IN PRIOR TO THE LOSS OR CASUALTY, THE
CLOSING
8
SHALL BE DEFERRED FOR A REASONABLE TIME (IN NO EVENT LONGER THAN THE DROP DEAD
DATE) SO THAT SELLER MAY REPAIR, REPLACE OR RESTORE THE PROPERTY TO THE
CONDITION IT WAS IN PRIOR TO THE LOSS OR CASUALTY;
(II)
IF PRIOR TO CLOSING, THE PROPERTY CAN BE REPAIRED, REPLACED OR
RESTORED TO THE CONDITION THE PROPERTY WAS IN PRIOR TO THE LOSS OR CASUALTY, THE
CLOSING SHALL PROCEED AND ALL CONDEMNATION OR INSURANCE PROCEEDS PAID OR TO BE
PAID AS A RESULT OF THE LOSS TO SUCH PROPERTY SHALL BE USED TO PAY EXPENSES OF
REPAIRING, REPLACING, AND RESTORING THE LOSS AND ANY REMAINING CONDEMNATION OR
INSURANCE PROCEEDS SHALL BE REMITTED TO SELLER;
(III)
SUBJECT TO SECTION 3.02(B) HEREOF, IF BEFORE CLOSING SUCH LOSS OR
TAKING CANNOT BE TOTALLY REPAIRED, REPLACED OR RESTORED TO THE CONDITION THE
PROPERTY WAS IN PRIOR TO THE LOSS OR CASUALTY, OR THERE IS A TAKING BY A
GOVERNMENTAL AUTHORITY BUYER MAY (BY WRITTEN NOTICE TO SELLER WITHIN FIVE (5)
DAYS AFTER RECEIPT OF NOTICE FROM SELLER OF SUCH LOSS, CASUALTY OR TAKING) CHOSE
TO EXCLUDE THE PROPERTY WHICH HAS BEEN SO DAMAGED, DESTROYED OR TAKEN AND
RECEIVE A CREDIT AGAINST THE PURCHASE PRICE IN THE AMOUNT REFLECTED IN EXHIBIT H
FOR SUCH PROPERTY, OR IF ITS NOT LISTED IN EXHIBIT H THEN THE PURCHASE PRICE
SHALL BE REDUCED BY THE FAIR MARKET VALUE OF SUCH PROPERTY AS DETERMINED BY A
MUTUALLY ACCEPTABLE APPRAISER; OR
(B)
IF PRIOR TO CLOSING, THE VESSEL SUFFERS A LOSS OR CASUALTY SUCH
THAT IT IS DETERMINED TO BE EITHER (I) A TOTAL LOSS FOR INSURANCE PURPOSES OR
(II) THE LOSS OR CASUALTY IS SUCH THAT THE VESSEL WOULD NOT BE OPERATIONAL PRIOR
TO THE DROP DEAD DATE, THEN EITHER BUYER OR SELLER MAY TERMINATE THIS AGREEMENT.
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3.03
CONDUCT OF BUSINESS.
PRIOR TO THE CLOSING, EXCEPT AS OTHERWISE
APPROVED BY BUYER IN WRITING, SELLER SHALL OPERATE THE PROPERTY AND ITS
BUSINESSES WHICH ARE PRESENTLY CONDUCTED WITH THE PROPERTY IN THE ORDINARY
COURSE THEREOF CONSISTENT WITH PAST PRACTICE (INCLUDING, WITHOUT LIMITATION,
CAPITAL EXPENDITURES, THE ACQUISITION OF PARTS AND INVENTORY, KEEPING OF ALL OF
THE PROPERTY IN GOOD WORKING ORDER AND REPAIR, AND REPLACING ANY PROPERTY WHICH
SHALL BE WORN OUT, LOST, STOLEN, DAMAGED OR DESTROYED) AND IN SUCH A MANNER THAT
SELLER MAY CONTINUE TO PERFORM ITS OBLIGATIONS UNDER THE EXISTING CONTRACTS AND
AS MAY BE REQUIRED BY ANY APPLICABLE LAW.
SELLER SHALL GIVE BUYER PROMPT
WRITTEN NOTICE OF ANY AND