Common use of Alleged Adverse Conditions Clause in Contracts

Alleged Adverse Conditions. As soon as reasonably practical (and on an ongoing basis), but no later than one hundred twenty (120) Days after the Closing Date (the “Adverse Condition Diligence Review Deadline”), Buyer shall notify Seller of any conditions that might constitute Alleged Adverse Conditions. Buyer’s notice of such conditions must include (i) a description of each individual condition to which Buyer takes exception (including any and all supporting documentation) and (ii) an estimate of the costs Buyer in good faith attributes to bringing such condition into compliance with applicable Environmental Laws. Seller and Buyer shall meet from time to time to attempt to agree on a resolution of Alleged Adverse Conditions. 5.2.1 If the Parties are unable to agree on resolution of any Alleged Adverse Conditions on or before sixty (60) Days after the Adverse Condition Diligence Review Deadline, Seller has the option, in its sole discretion, to either (a) bring the Alleged Adverse Condition into compliance with Environmental Laws (as in effect as of the Closing Date); or (b) deliver to Buyer an indemnity agreement in favor of Buyer Group, upon terms reasonably acceptable to Buyer, fully releasing Buyer Group from and protecting, defending, indemnifying and holding Buyer Group harmless from and against all Environmental Claims arising from or relating to such Alleged Adverse Condition. 5.2.2 If Seller elects, at its sole cost, to bring any Alleged Adverse Condition into compliance with Environmental Laws (as in effect as of the Closing Date), Seller may, by notice to Buyer, elect to continue attempting to remediate such condition to completion for up to one hundred eighty (180) Days after the Adverse Condition Diligence Review Deadline. Seller’s remediation of any Alleged Adverse Condition may not materially interfere with the use of operation of the affected Property. If Seller does not remediate an Alleged Adverse Condition within such period, Buyer shall give Seller written notice of such failure or non-completion and within five (5) Business Days following the earlier to occur of the date that (i) Seller and Buyer agree in writing on the existence and value of the Alleged Adverse Condition or (ii) resolution of any dispute regarding the existence or value of the Alleged Adverse Condition in accordance with the provisions of Article 5.4, Seller shall pay to Buyer an amount equal to the value of such Alleged Adverse Condition, if any, as so agreed or determined. 5.2.3 If an Alleged Adverse Condition can be remediated, the adjustments or payments with respect to that Alleged Adverse Condition shall not exceed the Prudent Cost Response. 5.2.4 Notwithstanding anything contained in this Agreement to the contrary, Buyer shall not be entitled to an adjustment or other remedy relating to any Alleged Adverse Condition unless and until the aggregate value of all Aggregate Transaction Claims exceeds the Deductible, and then only to the extent such Aggregate Transaction Claims exceeds the Deductible; and Buyer shall be solely responsible for and bear all costs and expenses associated with any and all Aggregate Transaction Claims up to the Deductible. No payment shall be due with respect to any Alleged Adverse Condition for which Seller, at its option, delivers to Buyer an indemnity agreement in favor of Buyer in accordance with Article 5.2.1, nor shall any Alleged Adverse Condition for which Seller has indemnified Buyer be included as an Aggregate Transaction Claim.

Alleged Adverse Conditions. As soon as reasonably practical (and on an ongoing basis), but in no event later than one hundred twenty eighty (120180) Days after the Closing Date (the “Adverse Condition Diligence Review Deadline”)Closing, Buyer shall notify Seller of any conditions that might constitute Properties which are subject to Alleged Adverse ConditionsCondition(s). Buyer’s 's notice of such conditions must Alleged Adverse Condition(s) shall include (i) a complete description of each individual condition to which Buyer takes exception (including any and all supporting documentationdocumentation associated therewith) and (ii) an estimate of the costs which Buyer in good faith attributes to bringing such condition into compliance with applicable Environmental Lawsremediating the same. Buyer and Seller and Buyer shall meet from time to time to as necessary in an attempt to mutually agree on a proposed resolution of with respect to the Alleged Adverse Conditions. 5.2.1 If Condition(s) raised by Buyer. The value allocated to each Property as set forth on Exhibit "A" and the Parties are unable costs to agree on resolution cure such Alleged Adverse Condition shall be used by the parties to determine the amount of any adjustment, if any, due to the existence of an Alleged Adverse Conditions on or before sixty (60Condition. It is recognized that good faith differences of opinion may exist between Buyer and Seller in connection with the Alleged Adverse Condition(s) Days after the Adverse Condition Diligence Review Deadlineraised by Buyer, Seller has the optionincluding without limitation, in its sole discretion, to either disputes as to: (a) bring whether or not the Alleged Adverse Condition into compliance with Environmental Laws (as in effect as of the Closing Date); or (b) deliver to Buyer an indemnity agreement in favor of Buyer Group, upon terms reasonably acceptable to Buyer, fully releasing Buyer Group from and protecting, defending, indemnifying and holding Buyer Group harmless from and against all Environmental Claims arising from or relating to such Alleged Adverse Condition. 5.2.2 If Seller elects, at its sole cost, to bring any Alleged Adverse Condition into compliance with Environmental Laws (as in effect as of the Closing Date), Seller may, by notice to Buyer, elect to continue attempting to remediate such condition to completion for up to one hundred eighty (180) Days after the Adverse Condition Diligence Review Deadline. Seller’s remediation of any Alleged Adverse Condition may not materially interfere with the use of operation of the affected Property. If Seller does not remediate alleged defect constitutes an Alleged Adverse Condition within such periodthe meaning of this Agreement, Buyer shall give Seller written notice of such failure (b) whether or non-completion and within five (5) Business Days following not the earlier to occur of the date that (i) Seller and Buyer agree in writing on the existence and value magnitude of the Alleged Adverse Condition individually or in the aggregate exceeds the threshold amounts set forth in Article 1.3, (iic) resolution of any dispute regarding whether or not the existence or value Alleged Adverse Condition raised by Buyer was properly and timely asserted by Buyer pursuant to this Article, and/or (d) the adjustment to the Purchase Price, if any, on account of the Alleged Adverse Condition in accordance with the provisions Condition. If any such difference of Article 5.4, Seller shall pay to Buyer an amount equal to the value of such Alleged Adverse Condition, if any, as so agreed or determined. 5.2.3 If opinion regarding an Alleged Adverse Condition can be remediatedraised by Buyer is not resolved by mutual agreement of Buyer and Seller, either party shall have the adjustments or payments with respect right, exercisable within two hundred seventy (270) Days after Closing, to that Alleged Adverse Condition shall not exceed the Prudent Cost Response.initiate 5.2.4 1. Notwithstanding anything contained in this Agreement to the contrarycontrary (including Article 19.1), if Seller disagrees with the decision of the arbitration panel, Seller shall have the right (but not the obligation) to: (i) remediate, at Seller's sole cost, the Property at issue to a point where it is in compliance with the Laws, or (ii) require the reassignment of the Property at issue from Buyer to Seller. If Seller elects to require the reassignment of the Property at issue, Buyer shall not be entitled and Seller will take all necessary action (including without limitation, execution of documentation and conducting an accounting) required to an adjustment or other remedy relating to any Alleged Adverse Condition unless and until place the aggregate value of all Aggregate Transaction Claims exceeds the Deductible, and then only to the extent such Aggregate Transaction Claims exceeds the Deductible; and Buyer shall be solely responsible for and bear all costs and expenses associated with any and all Aggregate Transaction Claims up to the Deductible. No payment shall be due parties back into a position with respect to any Alleged Adverse Condition for which Seller, the Property at its option, delivers issue just prior to Buyer an indemnity agreement in favor of Buyer in accordance with Article 5.2.1, nor shall any Alleged Adverse Condition for which Seller has indemnified Buyer be included as an Aggregate Transaction ClaimClosing.

Alleged Adverse Conditions. As soon as reasonably practical (and on an ongoing basis), but in no event later than one two hundred twenty seventy (120270) Days after the Closing Date (the “Adverse Condition Diligence Review Deadline”)Closing, Buyer shall notify Seller of any conditions that might constitute Properties which are subject to Alleged Adverse ConditionsCondition(s). Buyer’s 's notice of such conditions must Alleged Adverse Condition(s) shall include (i) a complete description of each individual condition to which Buyer takes exception (including any and all supporting documentationdocumentation associated therewith) and (ii) an estimate of the costs which Buyer in good faith attributes to bringing such condition into compliance with applicable Environmental Lawsremediating the same. In evaluating the existence or magnitude of an Alleged Adverse Condition, due consideration shall be given to the length of time the Alleged Adverse Condition has been in existence and whether the Alleged Adverse Condition is customarily acceptable to reasonable persons engaged in the business of ownership and operation of oil and gas properties. Buyer and Seller and Buyer shall meet from time to time to as necessary in an attempt to mutually agree on a proposed resolution of with respect to the Alleged Adverse Conditions. 5.2.1 If Condition(s) raised by Buyer. The value allocated to each Property as set forth on Exhibits "A" and "B", as applicable, and the Parties are unable costs to agree on resolution cure such adverse condition shall be used by the parties to determine the amount of any adjustment, if any, due to the existence of an Alleged Adverse Conditions on or before sixty (60Condition. It is recognized that good faith differences of opinion may exist between Buyer and Seller in connection with the Alleged Adverse Condition(s) Days after the Adverse Condition Diligence Review Deadlineraised by Buyer, Seller has the optionincluding without limitation, in its sole discretion, to either disputes as to: (a) bring whether or not the Alleged Adverse Condition into compliance with Environmental Laws (as in effect as of the Closing Date); or (b) deliver to Buyer an indemnity agreement in favor of Buyer Group, upon terms reasonably acceptable to Buyer, fully releasing Buyer Group from and protecting, defending, indemnifying and holding Buyer Group harmless from and against all Environmental Claims arising from or relating to such Alleged Adverse Condition. 5.2.2 If Seller elects, at its sole cost, to bring any Alleged Adverse Condition into compliance with Environmental Laws (as in effect as of the Closing Date), Seller may, by notice to Buyer, elect to continue attempting to remediate such condition to completion for up to one hundred eighty (180) Days after the Adverse Condition Diligence Review Deadline. Seller’s remediation of any Alleged Adverse Condition may not materially interfere with the use of operation of the affected Property. If Seller does not remediate alleged defect constitutes an Alleged Adverse Condition within such periodthe meaning of this Agreement, Buyer shall give Seller written notice of such failure (b) whether or non-completion and within five (5) Business Days following not the earlier to occur of the date that (i) Seller and Buyer agree in writing on the existence and value magnitude of the Alleged Adverse Condition individually exceeds the threshold amount set forth in Article 1.3, (c) whether or not the Alleged Adverse Condition raised by Buyer was properly and timely asserted by Buyer pursuant to this Article, and/or (iid) resolution of any dispute regarding the existence or value adjustment to the Cash Purchase Price, if any, on account of the Alleged Adverse Condition in accordance with the provisions Condition. If any such difference of Article 5.4, Seller shall pay to Buyer an amount equal to the value of such Alleged Adverse Condition, if any, as so agreed or determined. 5.2.3 If opinion regarding an Alleged Adverse Condition can be remediatedraised by Buyer is not resolved by mutual agreement of Buyer and Seller, either party shall have the adjustments or payments right, exercisable within eighteen (18) months after Closing, to initiate binding arbitration in accordance with respect to that Alleged Adverse Condition shall not exceed the Prudent Cost ResponseArticle 18. 5.2.4 1. Notwithstanding anything contained in this Agreement to the contrarycontrary (including Article 18.1), Buyer if Seller disagrees with the decision of the arbitration panel, Seller shall have the right (but not be entitled to an adjustment or other remedy relating to any Alleged Adverse Condition unless and until the aggregate value of all Aggregate Transaction Claims exceeds the Deductibleobligation), and then only to the extent such Aggregate Transaction Claims exceeds the Deductible; and Buyer shall be solely responsible for and bear all costs and expenses associated with any and all Aggregate Transaction Claims up to the Deductible. No payment shall be due with respect to any Alleged Adverse Condition for which Seller, at its option, delivers exercisable by written notice thereof to Buyer an indemnity agreement in favor within fifteen (15) Days following the decision of Buyer in accordance with Article 5.2.1the arbitration panel, nor shall any Alleged Adverse Condition for which Seller has indemnified Buyer be included as an Aggregate Transaction Claim.to promptly remediate, at

Alleged Adverse Conditions. (a) As soon as reasonably practical (and on an ongoing basis)practicable, but no later than one hundred twenty the earlier of (120i) five (5) Business Days prior to the Closing Date and (ii) forty-five (45) Days after the Closing Signing Date (such time period, the “Adverse Condition Diligence Review DeadlineClaim Period”), Buyer shall Purchaser may notify Seller in writing of any conditions that might constitute Adverse Conditions with respect to any of the Properties (each, an “Alleged Adverse ConditionsCondition”). BuyerPurchaser’s notice of such conditions must asserting Alleged Adverse Conditions shall include (i) a complete description of each individual condition to which Buyer takes exception and full explanation (including copies of any and all supporting documentationdocumentation associated therewith) of each individual Alleged Adverse Condition being claimed and (ii) an estimate of the costs Buyer Prudent Cost Response that Purchaser in good faith attributes to bringing such condition into compliance with applicable Environmental LawsLaws (such notice, an “Adverse Condition Notice”). Seller and Buyer The Parties shall meet from time to time to as reasonably necessary in an attempt to agree on a resolution of Alleged Adverse Conditions. 5.2.1 If the Parties are unable with respect to agree on resolution of any outstanding Alleged Adverse Conditions on or before sixty timely raised hereunder. (60b) Days after the Adverse Condition Diligence Review Deadline, Seller has the optionright, in its sole discretionbut not the obligation, to either (a) bring the Alleged Adverse Condition into compliance with Environmental Laws (as in effect as of the Closing Date); or (b) deliver to Buyer an indemnity agreement in favor of Buyer Group, upon terms reasonably acceptable to Buyer, fully releasing Buyer Group from and protecting, defending, indemnifying and holding Buyer Group harmless from and against all Environmental Claims arising from or relating to such Alleged Adverse Condition. 5.2.2 If Seller electsattempt, at its sole cost, to bring cure or remove any Alleged Adverse Condition into compliance with Environmental Laws (as in effect as respect to the Properties of which it has been duly advised by Purchaser during the Closing Date), Adverse Condition Claim Period. If Seller may, by has given notice to BuyerPurchaser prior to Closing that it elects to attempt to correct the Alleged Adverse Condition, elect to continue attempting to remediate and if such condition to completion for up to Alleged Adverse Condition is not corrected on or before one hundred eighty (180) Days after the Adverse Condition Diligence Review Deadline. Closing, then, upon Seller’s remediation receipt of any Alleged Adverse Condition may not materially interfere with the use of operation of the affected Property. If Seller does not remediate an Alleged Adverse Condition within such period, Buyer shall give Seller written notice from Purchaser of such failure or non-completion and given within five thirty (530) Business Days following such one hundred eighty (180) Day period, and subject to the earlier right of Seller to occur of the date that (i) Seller and Buyer agree in writing on the existence and value of the Alleged Adverse Condition or (ii) resolution of any dispute regarding the existence or value of the Alleged Adverse Condition initiate binding arbitration in accordance with the provisions of set forth in Article 5.4XVIII to resolve any dispute regarding any such alleged non-completion, Seller shall pay to Buyer Purchaser, subject to Section 5.2(e), an amount equal to the value of remaining Prudent Cost Response for such Alleged Adverse Condition, if any, as so agreed or determined. 5.2.3 (c) If the Parties are unable to agree as to the existence, validity, value or resolution of one or more of the Alleged Adverse Conditions prior to the Closing (such inability to agree, an “Adverse Condition Dispute”), then (subject to Sections 15.2, 15.3 and 17.1), Purchaser shall be obligated to Close and, except as to Alleged Adverse Conditions of which Seller has given notice to Purchaser that it elects to attempt to correct (as provided above), at Seller’s election either: (i) the affected Property shall be an Excluded Property and the Purchase Price shall be reduced by the Good Faith Allocation of such Property, (ii) subject to Section 5.2(e), Seller shall indemnify Purchaser pursuant to Section 8.4(b) and the Property shall remain a Property acquired by Purchaser without any adjustment of the Purchase Price or (iii) subject to Section 5.2(e), the Property shall remain a Property acquired by Purchaser and the Purchase Price shall be reduced by an amount equal to the lesser of the Good Faith Allocation of such Property and the Prudent Cost Response for such Alleged Adverse Condition; provided, however, that either Party may initiate, within sixty (60) Days after the Closing (but not later), binding arbitration in accordance with the provisions set forth in Article XVIII to resolve any dispute arising prior to Closing regarding any Alleged Adverse Condition or the Prudent Cost Response thereof, except as to Alleged Adverse Conditions of which Seller has given notice that it elects to attempt to cure (as provided in Section 5.2(b)). Notwithstanding the foregoing sentence, either Party may initiate, within sixty (60) Days HOUSTON 1151220v.11 after the one hundred eighty (180) Day cure period (but not later), binding arbitration in accordance with the provisions set forth in Article XVIII to resolve any dispute regarding the failure to pursue diligently a cure or completion of the cure of an Alleged Adverse Condition can that Seller has elected to cure. (d) Notwithstanding anything to the contrary in Article XVIII, any arbitration initiated under this Section 5.2 shall be remediated, exclusively and finally resolved by a single arbitrator if the adjustments or payments with respect to that Alleged Adverse Condition Dispute involves less than Five Million Dollars ($5,000,000) and by a panel of three arbitrators if the Adverse Condition Dispute involves more than Five Million Dollars ($5,000,000). Any such arbitrator (the “Environmental Referee”) shall be an environmental attorney(s) with at least ten (10) years experience in oil and gas environmental matters, shall have not exceed at any point in the Prudent Cost Responsepast ten (10) years represented or been adverse to either Party (or any of their Affiliates) and shall be selected by mutual agreement of Purchaser and Seller within thirty (30) Days after the initiation of binding arbitration under Article XVIII, and absent such agreement, shall be selected by the Houston, Texas regional office of the AAA upon written request of either Party. Except as otherwise provided in the two preceding sentences, Adverse Condition Dispute arbitrations shall be conducted in accordance with Article XVIII. 5.2.4 (e) Notwithstanding anything contained in this Agreement to the contrarycontrary but subject to Seller’s indemnification obligations set forth in Sections 8.2, Buyer 8.4 and 8.6, Purchaser shall not be entitled to a Purchase Price adjustment, an adjustment indemnity or any other remedy relating to any an Adverse Condition unless (i) a Claim for the Alleged Adverse Condition unless is asserted by Purchaser within the Adverse Condition Claim Period, (ii) the amount of the Prudent Cost Response for such individual Alleged Adverse Condition exceeds a threshold amount of One Million Dollars ($1,000,000), net to Seller’s interest in the Property (the “Adverse Condition Threshold Amount”) and until (iii) the aggregate value of all Aggregate Transaction Claims for which Seller is responsible exceeds the DeductibleAggregate Deductible Amount (it being acknowledged and agreed that, and then only subject to the extent such Aggregate Transaction Claims exceeds the Deductible; provisions of Sections 8.2, 8.4 and Buyer 8.6, Purchaser shall be solely responsible for and bear all costs and expenses or loss of value associated with any each individual Alleged Adverse Condition asserted by Purchaser hereunder up to the Adverse Condition Threshold Amount and all for the aggregate of the Alleged Adverse Conditions to the extent they do not, when combined with the other Aggregate Transaction Claims up for which Seller is responsible, exceed the Aggregate Deductible Amount. Seller’s election to attempt to cure, or to provide indemnity against an Alleged Adverse Condition, shall not constitute a waiver of Seller’s right to dispute the existence, nature or value of, or cost to cure, the Alleged Adverse Condition. Notwithstanding anything in this Agreement to the Deductible. No payment shall be due contrary, Purchaser may not assert an Alleged Adverse Condition with respect to any a Property (x) of which it is the operator or (y) in which it owns an interest and with respect to which it is aware of such Alleged Adverse Condition for which Seller, at its option, delivers to Buyer an indemnity agreement in favor of Buyer in accordance with Article 5.2.1, nor shall any Alleged Adverse Condition for which Seller has indemnified Buyer be included as an Aggregate Transaction ClaimCondition.

Alleged Adverse Conditions. As 5.2.1 Subject to Section 5.2.6, as soon as reasonably practical (and on an ongoing basis)practicable, but no not later than one hundred twenty the earlier of: (120i) five (5) Business Days prior to the Closing Date, and (ii) forty-five (45) Days after the Closing Signing Date (such time period, the “Adverse Condition Diligence Review DeadlineClaim Period”), Buyer shall may notify Seller in writing of any conditions that might constitute Adverse Conditions with respect to any of the Properties (each, an “Alleged Adverse ConditionsCondition”). Buyer’s notice of such conditions must asserting Alleged Adverse Conditions shall include (i) a complete description of each individual condition to which Buyer takes exception and full explanation (including copies of any and all supporting documentationdocumentation associated therewith) of each individual Alleged Adverse Condition being claimed and (ii) an estimate of the costs Prudent Cost Response that Buyer in good faith attributes to bringing such condition into compliance with applicable Environmental LawsLaws (such notice, an “Adverse Condition Notice”). Seller and Buyer The Parties shall meet from time to time to as necessary in an attempt to agree on a resolution of Alleged Adverse Conditions. 5.2.1 If the Parties are unable with respect to agree on resolution of any outstanding Alleged Adverse Conditions on or before sixty (60) Days after the Adverse Condition Diligence Review Deadline, timely raised hereunder. HOUSTON 1139976v.13 5.2.2 Seller has the optionright, in its sole discretionbut not the obligation, to either (a) bring the Alleged Adverse Condition into compliance with Environmental Laws (as in effect as of the Closing Date); or (b) deliver to Buyer an indemnity agreement in favor of Buyer Group, upon terms reasonably acceptable to Buyer, fully releasing Buyer Group from and protecting, defending, indemnifying and holding Buyer Group harmless from and against all Environmental Claims arising from or relating to such Alleged Adverse Condition. 5.2.2 If Seller electsattempt, at its sole cost, to bring cure or remove any Alleged Adverse Condition into compliance with Environmental Laws respect to the Properties of which it has been duly advised by Buyer during the Adverse Condition Claim Period or Xxxxxxx Plant Adverse Conditions Claim Period (as applicable). If prior to Closing or, solely with respect to Adverse Condition Notices delivered in effect as accordance with Section 5.2.6, if within ten (10) Business Days after the end of the Closing Date)Xxxxxxx Plant Adverse Conditions Claim Period, Seller mayhas given notice to Buyer that it elects to attempt to correct the Alleged Adverse Condition, then Seller may elect, by written notice to BuyerBuyer prior to the Closing, elect to continue attempting to remediate correct such condition to completion for up to following Closing; provided that if such Alleged Adverse Condition is not corrected on or before one hundred eighty (180) Days after the Closing or one hundred eighty (180) Days after the end of the Xxxxxxx Plant Adverse Condition Diligence Review Deadline. Seller’s remediation of any Alleged Adverse Condition may not materially interfere with the use of operation of the affected Property. If Seller does not remediate an Alleged Adverse Condition within such period, Buyer shall give Seller written notice of such failure or non-completion and within five (5) Business Days following the earlier to occur of the date that Claim Period: (i) Seller and Buyer agree in writing on the existence and value of the with respect to Alleged Adverse Condition Conditions raised pursuant to Section 5.2.6 or (ii) resolution of any dispute regarding if the existence or value of the Alleged Adverse Condition Threshold Amount is first exceeded during the Xxxxxxx Plant Adverse Condition Claim Period, then, upon Seller’s receipt of written notice from Buyer of such non-completion given within thirty (30) Days following the end of such one hundred eighty (180) Day period, and subject to the right of Seller to initiate binding arbitration in accordance with the provisions of set forth in Article 5.418 to resolve any dispute regarding any such alleged non-completion, Seller shall pay to Buyer Buyer, subject to Section 5.2.5, an amount equal to the value of remaining Prudent Cost Response for such Alleged Adverse Condition, if any, as so agreed or determined. 5.2.3 If the Parties are unable to agree as to the existence, validity, value or resolution of one or more of the Alleged Adverse Conditions prior to Closing (such inability to agree, an “Adverse Condition Dispute”), then (subject to Sections 15.2, 15.3 and 17.1) Buyer shall be obligated to Close and, except as to Alleged Adverse Conditions of which Seller has given notice to Buyer that it elects to correct (as provided above), at Seller’s election either: (i) the affected Property shall be an Excluded Property and the Purchase Price shall be reduced by the Good Faith Allocation of such Property, (ii) subject to Section 5.2.5, Seller shall indemnify Buyer pursuant to Section 8.3.2 and the Property shall remain a Property acquired by Buyer without any adjustment of the Purchase Price or (iii) subject to Section 5.2.5, the Property shall remain a Property acquired by Buyer and the Purchase Price shall be reduced by an amount equal to the lesser of the Good Faith Allocation of such Property and the Prudent Cost Response for such Alleged Adverse Condition; provided however, that either Party may initiate, within sixty (60) Days after Closing (but not later), binding arbitration in accordance with the provisions set forth in Article 18 to resolve any dispute arising prior to Closing regarding any Alleged Adverse Condition or the Prudent Cost Response thereof, except as to Alleged Adverse Conditions of which Seller has given notice that it elects to cure (as provided in Section 5.2.2). Notwithstanding the foregoing sentence, either Party may initiate, within sixty (60) Days after the one hundred eighty (180) Day cure period (but not later), binding arbitration in accordance with the provisions set forth in Article 18 to resolve any dispute regarding the failure to pursue diligently a cure or completion of the cure of an Alleged Adverse Condition can be remediated, the adjustments or payments with respect that Seller has elected to that Alleged Adverse Condition shall not exceed the Prudent Cost Responsecure. 5.2.4 Notwithstanding anything to the contrary in Article 18, any arbitration initiated under this Section 5.2 shall be exclusively and finally resolved by a single arbitrator if the Adverse Condition Dispute involves less than Five Million Dollars HOUSTON 1139976v.13 ($5,000,000) and by a panel of three arbitrators if the Adverse Condition Dispute involves more than Five Million Dollars ($5,000,000). Any such arbitrator (the “Environmental Referee”) shall be an environmental attorney(s) with at least ten (10) years experience in oil and gas facility environmental matters, shall have not at any point in the past ten (10) years represented or been adverse to either Party (or any of their Affiliates) and shall be selected by mutual agreement of Buyer and Seller within thirty (30) Days after the initiation of binding arbitration under Article 18, and absent such agreement, shall be selected by the Houston, Texas regional office of the AAA upon written request of either Party. Except as otherwise provided in the two preceding sentences, Adverse Condition Dispute arbitrations shall be conducted in accordance with Article 18. 5.2.5 Notwithstanding anything contained in this Agreement to the contrarycontrary but subject to Seller’s indemnification obligations set forth in Sections 8.2, 8.3 and 8.6, Buyer shall not be entitled to a Purchase Price adjustment, an adjustment indemnity or any other remedy relating to any an Adverse Condition unless (i) a Claim for the Alleged Adverse Condition unless is asserted by Buyer within the Adverse Condition Claim Period or the Xxxxxxx Plant Adverse Conditions Claim Period (as applicable), (ii) the amount of the Prudent Cost Response for such individual Alleged Adverse Condition exceeds a threshold amount of One Million Dollars ($1,000,000) (the “Adverse Condition Threshold Amount”), and until (iii) the aggregate value of all Aggregate Transaction Claims for which Seller is responsible exceeds the DeductibleAggregate Deductible Amount (it being acknowledged and agreed that, and then only subject to the extent such Aggregate Transaction Claims exceeds the Deductible; provisions of Sections 8.2, 8.3 and 8.6, Buyer shall be solely responsible for and bear all costs and expenses or loss of value associated with any each individual Alleged Adverse Condition asserted by Buyer hereunder up to the Adverse Condition Threshold Amount and all for the aggregate of the Alleged Adverse Conditions to the extent they do not, when combined with the other Aggregate Transaction Claims up for which Seller is responsible, exceed the Aggregate Deductible Amount). Seller’s election to attempt to cure, or to provide indemnity against an Alleged Adverse Condition, shall not constitute a waiver of Seller’s right to dispute the existence, nature or value of, or cost to cure, the Alleged Adverse Condition. Notwithstanding anything in this Agreement to the Deductible. No payment shall be due contrary, Buyer may not assert an Alleged Adverse Condition with respect to a Property (i) of which it is the operator or (ii) in which it owns an interest and with respect to which it is aware of such Alleged Adverse Condition. 5.2.6 Notwithstanding anything otherwise provided in this Section 5.2.6, Buyer shall have the right to provide Seller an Adverse Condition Notice related solely to the Xxxxxxx Plant for a period beginning on the Day Seller gives Buyer written notice that Seller has completed the Xxxxxxx Plant Remediation Project and ending on the Day which is thirty (30) Days later (the “Xxxxxxx Plant Adverse Conditions Claim Period”). Except as otherwise expressly provided in this Section 5.2.6, any Alleged Adverse Condition for which Seller, at its option, delivers Conditions related to Buyer an indemnity agreement the Xxxxxxx Plant shall be subject to the procedures set forth in favor of Buyer in accordance with Article 5.2.1, nor shall any Alleged Adverse Condition for which Seller has indemnified Buyer be included as an Aggregate Transaction ClaimSection 5.2.

Alleged Adverse Conditions. (a) As soon as reasonably practical practicable (and on an ongoing basis), but no later than one hundred twenty thirty (12030) Days after following the Closing Date (the “Adverse Condition Diligence Review Deadline”)execution of this Agreement, Buyer shall may notify Seller in writing of any conditions that might constitute Alleged Adverse Conditions. Buyer’s notice of such conditions asserting Alleged Adverse Conditions must include (i) a reasonably detailed description of each individual condition to which Buyer takes exception and explanation (including any and all available supporting documentation) of each Alleged Adverse Condition claimed, the Properties affected, and (ii) an estimate of the costs value Buyer in good faith attributes to the Alleged Adverse Condition (including its good faith estimate of the costs of bringing such condition into compliance with applicable Environmental Laws). Buyer and Seller and Buyer shall meet from time to time-to-time to attempt to agree on a resolution of with respect to Alleged Adverse Conditions. 5.2.1 If . Seller shall have the Parties are unable to agree on resolution of any Alleged Adverse Conditions on or before sixty (60) Days after right, but not the Adverse Condition Diligence Review Deadline, Seller has the option, in its sole discretionobligation, to either (a) bring the Alleged Adverse Condition into compliance with Environmental Laws (as in effect as of the Closing Date); or (b) deliver to Buyer an indemnity agreement in favor of Buyer Group, upon terms reasonably acceptable to Buyer, fully releasing Buyer Group from and protecting, defending, indemnifying and holding Buyer Group harmless from and against all Environmental Claims arising from or relating to such Alleged Adverse Condition. 5.2.2 If Seller electsattempt, at its sole cost, to bring cure on or before the Closing Date any Alleged Adverse Conditions with respect to the Properties. If prior to Closing, Seller has commenced to cure the Alleged Adverse Condition into compliance with Environmental Laws (as in effect as of the Closing Date)a timely manner and pursues such cure diligently, then Seller may, by notice to BuyerBuyer prior to Closing, elect to continue diligently attempting to remediate cure such condition to completion for up to one hundred eighty (180) Days after following Closing. (b) A Purchase Price adjustment shall be made under Article 2.2(k) by reducing the Purchase Price by the net aggregate value of all actual Alleged Adverse Condition Diligence Review DeadlineConditions timely reported under this Article and not timely cured as permitted under this Article, subject to Article 5.2(g) and the other terms of this Article. Seller’s remediation When calculating the value of any Alleged Adverse Condition may not materially interfere with Conditions, notwithstanding anything herein to the use of operation of the affected Property. If Seller does not remediate contrary, if an Alleged Adverse Condition within such period, Buyer shall give Seller written notice is reasonably susceptible of such failure or non-completion and within five (5) Business Days following the earlier to occur of the date that (i) Seller and Buyer agree in writing on the existence and value of the Alleged Adverse Condition or (ii) resolution of any dispute regarding the existence or value of the Alleged Adverse Condition in accordance with the provisions of Article 5.4, Seller shall pay to Buyer an amount equal to the value of such Alleged Adverse Condition, if any, as so agreed or determined. 5.2.3 If an Alleged Adverse Condition can be remediatedbeing cured, the adjustments or payments with respect to that Alleged Adverse Condition shall not exceed the Prudent Cost Responsereasonable costs of cure. 5.2.4 (c) Notwithstanding the other terms of this Article 5.2, Seller may elect by notice to Buyer at least five (5) Days prior to the Closing Date to exclude from this Agreement any lease, well, unit and associated Property affected by an Alleged Adverse Condition of which Buyer has provided timely notice if (i) such affected Property has a positive Buyer’s Allocation and the cumulative adjustments and payments associated with the effects of Alleged Adverse Conditions on such Property and associated Property would exceed Buyer’s Allocation for such Property or (ii) such Property has a negative Buyer’s Allocation. In the event any Property is excluded from this Agreement pursuant to this Article, the Purchase Price shall be reduced (or increased, if such allocation is negative) by Buyer’s Allocation for such Property, and no other adjustment shall be made with respect to such Property. (d) If prior to Closing, the Parties are unable to agree on a resolution associated with any Alleged Adverse Conditions raised by Buyer, the Parties shall Close with the Purchase Price being reduced by Seller’s estimate of the value of all uncured Alleged Adverse Conditions, excluding those Alleged Adverse Conditions with respect to which Seller has provided notice of its election to continue curing under Article 5.2(a); provided, however, that within thirty (30) Days after the Closing Date, either Party may initiate binding arbitration in accordance with the provisions set forth in Article 18 to resolve the dispute. (e) If by one hundred eighty (180) Days following Closing, Seller has failed to cure any Alleged Adverse Conditions with respect to which Seller has provided notice of its election to continue curing under Article 5.2(a), and the Parties have been unable by such date to agree upon a resolution associated with such Alleged Adverse Conditions, Seller shall make a payment to Buyer equal to Seller’s estimate of the value of such uncured Alleged Adverse Conditions. Within thirty (30) Days after the one hundred eighty (180) Day cure period has expired, either Party may initiate binding arbitration in accordance with the provisions set forth in Article 18 to resolve the dispute. (f) Any claim for payment with respect to any Alleged Adverse Condition, and any assertion that any Alleged Adverse Condition for which Seller has provided notice of its intent to cure has not been cured, that are not resolved by agreement of the Parties or referred to arbitration within thirty (30) Days following Closing (or, in the event Seller provides notice that it will continue attempting to cure the Alleged Adverse Conditions after Closing, within thirty (30) Days after the one hundred eighty (180) Day cure period following Closing has expired) shall be deemed waived, unless the thirty (30) Day period is extended by mutual written agreement of the Parties. (g) Notwithstanding anything contained in this Agreement to the contrary, Buyer shall not be entitled to an adjustment or other remedy relating to any Alleged Adverse Condition under Articles 5.2, 8.3 (except Article 8.3(d)) or 8.4 unless and until the aggregate value of all Aggregate Transaction Alleged Adverse Conditions (determined in accordance with this Article 5.2), and the costs and expenses associated with any Non-Environmental Claims, Environmental Claims and claims under Article 8.3 (except Article 8.3(d)), in each case timely reported under those Articles and not cured by Seller, exceeds an amount equal to one percent (1%) of the Purchase Price as adjusted for Properties excluded pursuant to Article 3.1 hereof for preferential purchase rights exercised (the “Deductible, ”) and then only to the extent such Aggregate Transaction Claims aggregate value exceeds the Deductible; , and Buyer shall be solely responsible for and bear all costs and expenses associated with any and all Aggregate Transaction Alleged Adverse Conditions, Non-Environmental Claims, Environmental Claims and claims under Article 8.3 (except Article 8.3(d)) up to the Deductible. No payment shall be due with respect Deductible and as is otherwise provided in this Agreement. (h) Seller’s election to any attempt to cure an Alleged Adverse Condition for which shall not constitute a waiver of Seller’s right to dispute the existence, at its optionnature, delivers or value of, or cost to Buyer cure, the Alleged Adverse Condition. Buyer’s acceptance of any payment or adjustment based on Seller’s estimate of the value of an indemnity agreement in favor of Buyer in accordance with Article 5.2.1, nor shall any uncured Alleged Adverse Condition for which Seller has indemnified that was not agreed to by Buyer be included as an Aggregate Transaction Claimshall not constitute a waiver of Buyer’s right to dispute such estimate by initiating arbitration within the time period permitted by this Article.

Alleged Adverse Conditions. As soon as reasonably practical (and on -------------------------- an ongoing basis), but in no event later than one hundred twenty and eighty (120180) Days after the Closing Date (the “Adverse Condition Diligence Review Deadline”)Closing, Buyer shall notify Seller of any conditions that might constitute Properties which are subject to Alleged Adverse ConditionsCondition(s). Buyer’s 's notice of such conditions must Alleged Adverse Condition(s) shall include (i) a complete description of each individual condition to which Buyer takes exception (including any and all supporting documentationdocumentation associated therewith) and (ii) an estimate of the costs which Buyer in good faith attributes to bringing remediating the same. In evaluating the existence or magnitude of an Alleged Adverse Condition, due consideration shall be given to the length of time the Alleged Adverse Condition has been in existence and whether such fact, circumstance or condition into compliance with applicable Environmental Lawsis of the type expected to be encountered in the area involved, and whether the Alleged Adverse Condition is customarily acceptable to reasonable persons engaged in the business of ownership and operation of oil and gas properties. Buyer and Seller and Buyer shall meet from time to time to as necessary in an attempt to mutually agree on a proposed resolution of Alleged Adverse Conditions. 5.2.1 If the Parties are unable with respect to agree on resolution of any Alleged Adverse Conditions on or before sixty (60) Days after the Adverse Condition Diligence Review Deadline, Seller has the option, in its sole discretion, to either (a) bring the Alleged Adverse Condition into compliance with Environmental Laws (Condition(s) raised by Buyer. The value allocation to each Property as in effect as of set forth on Exhibit "A" and the Closing Date); or (b) deliver costs to Buyer an indemnity agreement in favor of Buyer Group, upon terms reasonably acceptable cure such adverse condition shall be used by the parties to Buyer, fully releasing Buyer Group from and protecting, defending, indemnifying and holding Buyer Group harmless from and against all Environmental Claims arising from or relating to such Alleged Adverse Condition. 5.2.2 If Seller elects, at its sole cost, to bring any Alleged Adverse Condition into compliance with Environmental Laws (as in effect as of determine the Closing Date), Seller may, by notice to Buyer, elect to continue attempting to remediate such condition to completion for up to one hundred eighty (180) Days after the Adverse Condition Diligence Review Deadline. Seller’s remediation amount of any Alleged Adverse Condition may not materially interfere with the use of operation of the affected Property. If Seller does not remediate an Alleged Adverse Condition within such period, Buyer shall give Seller written notice of such failure or non-completion and within five (5) Business Days following the earlier to occur of the date that (i) Seller and Buyer agree in writing on the existence and value of the Alleged Adverse Condition or (ii) resolution of any dispute regarding the existence or value of the Alleged Adverse Condition in accordance with the provisions of Article 5.4, Seller shall pay to Buyer an amount equal to the value of such Alleged Adverse Conditionadjustment, if any, as so agreed or determined. 5.2.3 If due to the existence of an Alleged Adverse Condition can be remediated, Condition. It is recognized that good faith differences of opinion may exist between Buyer and Seller in connection with the adjustments or payments with respect to that Alleged Adverse Condition shall not exceed the Prudent Cost Response.Condition(s) raised by Buyer, including without limitation, 5.2.4 1. Notwithstanding anything contained in this Agreement to the contrarycontrary (including Article 18.1), if Seller disagrees with the decision of the arbitration panel, Seller shall have the right (but not the obligation) to: (i) remediate, at Seller's sole cost, the Property at issue to a point where it is in compliance with the Laws, or (ii) require the reassignment of the Property at issue from Buyer to Seller. If Seller elects to require the reassignment of the Property at issue, Buyer shall not be entitled and Seller will take all necessary action (including without limitation, execution of documentation and conducting an accounting) required to an adjustment or other remedy relating to any Alleged Adverse Condition unless and until place the aggregate value of all Aggregate Transaction Claims exceeds the Deductible, and then only to the extent such Aggregate Transaction Claims exceeds the Deductible; and Buyer shall be solely responsible for and bear all costs and expenses associated with any and all Aggregate Transaction Claims up to the Deductible. No payment shall be due parties back into a position with respect to any Alleged Adverse Condition for which Seller, the Property at its option, delivers issue just prior to Buyer an indemnity agreement in favor of Buyer in accordance with Article 5.2.1, nor shall any Alleged Adverse Condition for which Seller has indemnified Buyer be included as an Aggregate Transaction ClaimClosing.

Alleged Adverse Conditions. (a) As soon as reasonably practical practicable (and on an ongoing basis), but no later than one hundred twenty fifteen (12015) Days after the Closing Date (the “Adverse Condition Diligence Review Deadline”)prior to Closing, Buyer shall may notify Seller in writing of any conditions that might constitute Alleged Adverse Conditions. Buyer’s 's notice of such conditions asserting Alleged Adverse Conditions must include (i) a reasonably detailed description of each individual condition to which Buyer takes exception and explanation (including any and all available supporting documentation) of each Alleged Adverse Condition claimed, the Properties affected, and (ii) an estimate of the costs value Buyer in good faith attributes to bringing such condition into compliance with applicable Environmental Lawsthe Alleged Adverse Condition. Buyer and Seller and Buyer shall meet from time to time-to-time to attempt to agree on a resolution of with respect to Alleged Adverse Conditions. 5.2.1 If . Seller shall have the Parties are unable to agree on resolution of any Alleged Adverse Conditions on or before sixty (60) Days after right, but not the Adverse Condition Diligence Review Deadline, Seller has the option, in its sole discretionobligation, to either (a) bring the Alleged Adverse Condition into compliance with Environmental Laws (as in effect as of the Closing Date); or (b) deliver to Buyer an indemnity agreement in favor of Buyer Group, upon terms reasonably acceptable to Buyer, fully releasing Buyer Group from and protecting, defending, indemnifying and holding Buyer Group harmless from and against all Environmental Claims arising from or relating to such Alleged Adverse Condition. 5.2.2 If Seller electsattempt, at its sole cost, to bring cure or remove on or before the Closing Date any Alleged Adverse Conditions with respect to the Properties. If prior to Closing, Seller has commenced to cure the Alleged Adverse Condition into compliance with Environmental Laws (as in effect as of the Closing Date)a timely manner and pursues such cure diligently, then Seller may, by notice to BuyerBuyer prior to Closing, elect to continue diligently attempting to remediate cure such condition to completion for up to one hundred eighty (180) Days after following Closing. (b) A Purchase Price adjustment shall be made under Article 2.2(l) by reducing the Purchase Price by the net aggregate value of all actual Alleged Adverse Condition Diligence Review DeadlineConditions timely reported under this Article and not timely cured as permitted under this Article, subject to Article 5.2(g) and the other terms of this Article. Seller’s remediation When calculating the value of any Alleged Adverse Condition may not materially interfere with the use of operation of the affected Property. If Seller does not remediate Conditions, if an Alleged Adverse Condition within such period, Buyer shall give Seller written notice is reasonably susceptible of such failure or non-completion and within five (5) Business Days following the earlier to occur of the date that (i) Seller and Buyer agree in writing on the existence and value of the Alleged Adverse Condition or (ii) resolution of any dispute regarding the existence or value of the Alleged Adverse Condition in accordance with the provisions of Article 5.4, Seller shall pay to Buyer an amount equal to the value of such Alleged Adverse Condition, if any, as so agreed or determined. 5.2.3 If an Alleged Adverse Condition can be remediatedbeing cured, the adjustments or payments with respect to that Alleged Adverse Condition shall not exceed the Prudent Cost Responsereasonable costs of cure. 5.2.4 (c) Notwithstanding the other terms of this Article 5.2, Seller may elect by notice to Buyer at least five (5) Business Days prior to the Closing Date to exclude from this Agreement any Real Property and associated personal Property affected by an Alleged Adverse Condition of which Buyer has provided timely notice if (i) the Real Property has a positive Buyer's Allocation and the cumulative adjustments and payments associated with the effects of Alleged Adverse Conditions on such Real Property and associated personal Property would exceed Buyer's Allocation for such Real Property or (ii) the Real Property has a negative Buyer's Allocation. In the event any Property is excluded from this Agreement pursuant to this Article, the Purchase Price shall be reduced by Buyer's Allocation for such Property, and no other adjustment shall be made with respect to such Property. (d) If prior to Closing, the Parties are unable to agree on a resolution associated with any Alleged Adverse Conditions raised by Buyer, the Parties shall Close with the Purchase Price being reduced by Seller's estimate of the value of all uncured Alleged Adverse Conditions, excluding those Alleged Adverse Conditions with respect to which Seller has provided notice of its election to continue curing under Article 5.2(a); provided, however, that within thirty (30) Days after the Closing Date, either Party may initiate binding arbitration in accordance with the provisions set forth in Article 18.1 to resolve the dispute. (e) If by one hundred eighty (180) Days following Closing, Seller has failed to cure any Alleged Adverse Conditions with respect to which Seller has provided notice of its election to continue curing under Article 5.2(a), and the Parties have been unable by such date to agree upon a resolution associated with such Alleged Adverse Conditions, Seller shall make a payment to Buyer equal to Seller's estimate of the value of such uncured Alleged Adverse Conditions. Within thirty (30) Days after the one hundred eighty (180) Day cure period has expired, either Party may initiate binding arbitration in accordance with the provisions set forth in Article 18.1 to resolve the dispute. (f) ANY CLAIM FOR PAYMENT WITH RESPECT TO ANY ALLEGED ADVERSE CONDITION, AND ANY ASSERTION THAT ANY ALLEGED ADVERSE CONDITION FOR WHICH SELLER HAS PROVIDED NOTICE OF ITS INTENT TO CURE HAS NOT BEEN CURED, THAT ARE NOT RESOLVED BY AGREEMENT OF THE PARTIES OR REFERRED TO ARBITRATION WITHIN THIRTY (30) DAYS FOLLOWING CLOSING (OR, IN THE EVENT SELLER PROVIDES NOTICE THAT IT WILL CONTINUE ATTEMPTING TO CURE THE ALLEGED ADVERSE CONDITIONS AFTER CLOSING, WITHIN THIRTY (30) DAYS AFTER THE ONE HUNDRED EIGHTY (180) DAY CURE PERIOD FOLLOWING CLOSING HAS EXPIRED) SHALL BE DEEMED WAIVED, UNLESS THE THIRTY (30) DAY PERIOD IS EXTENDED BY MUTUAL WRITTEN AGREEMENT OF THE PARTIES. (g) Notwithstanding anything contained in this Agreement to the contrary, Buyer shall not be entitled to an adjustment or other remedy relating to any Alleged Adverse Condition under Articles 5.2, 8.3 or 8.4 unless and until the aggregate value (determined in accordance with those Articles) of all Aggregate Transaction Alleged Adverse Conditions, Non-Environmental Claims and Environmental Claims timely reported under those Articles and not cured by Seller exceeds the Deductibleseventeen million five hundred thousand United States dollars (US $17,500,000), and then only to the extent such Aggregate Transaction Claims aggregate value exceeds the Deductible; seventeen million five hundred thousand United States dollars (US $17,500,000), and as between Buyer and Seller Group, Buyer shall be solely responsible for and bear all costs and expenses associated with any and all Aggregate Transaction Alleged Adverse Conditions, Non-Environmental Claims and Environmental Claims up to the Deductible. No payment shall be due with respect seventeen million five hundred thousand United States dollars (US $17,500,000). (h) Seller's election to any attempt to cure an Alleged Adverse Condition for which shall not constitute a waiver of Seller's right to dispute the existence, at its optionnature, delivers or value of, or cost to Buyer cure, the Alleged Adverse Condition. Buyer's acceptance of any payment or adjustment based on Seller's estimate of the value of an indemnity agreement in favor of Buyer in accordance with Article 5.2.1, nor shall any uncured Alleged Adverse Condition for which Seller has indemnified Buyer be included as an Aggregate Transaction Claimshall not constitute a waiver of Buyer's right to dispute such estimate by initiating arbitration within the time period permitted by this Article.

Alleged Adverse Conditions. (a) As soon as reasonably practical (and on an ongoing basis)practicable, but no later than one hundred twenty during the period ending thirty (12030) Days after the Closing Signing Date (such time period, the “Adverse Condition Diligence Review DeadlineClaim Period”), Buyer shall Purchaser may notify Seller in writing of any conditions that might constitute Adverse Conditions with respect to any of the Purchased Assets (each, an “Alleged Adverse ConditionsCondition”). BuyerPurchaser’s notice of such conditions must asserting Alleged Adverse Conditions shall include (i) a complete description of each individual condition to which Buyer takes exception and full explanation (including copies of any and all supporting documentationdocumentation associated therewith) of each individual Alleged Adverse Condition being claimed and (ii) an estimate of the costs Buyer Prudent Cost Response that Purchaser in good faith attributes to bringing such condition into compliance with applicable Environmental LawsLaws (such notice, an “Adverse Condition Notice”). Seller and Buyer The Parties shall meet from time to time to as reasonably necessary in an attempt to agree on a resolution of Alleged Adverse Conditions. 5.2.1 If the Parties are unable with respect to agree on resolution of any outstanding Alleged Adverse Conditions on or before sixty timely raised hereunder. (60b) Days after the Adverse Condition Diligence Review Deadline, Seller has the optionright, in its sole discretionbut not the obligation, to either (a) bring the Alleged Adverse Condition into compliance with Environmental Laws (as in effect as of the Closing Date); or (b) deliver to Buyer an indemnity agreement in favor of Buyer Group, upon terms reasonably acceptable to Buyer, fully releasing Buyer Group from and protecting, defending, indemnifying and holding Buyer Group harmless from and against all Environmental Claims arising from or relating to such Alleged Adverse Condition. 5.2.2 If Seller electsattempt, at its sole cost, to bring cure or remove any Alleged Adverse Condition into compliance with Environmental Laws (as in effect as respect to the Purchased Assets of which it has been duly advised by Purchaser during the Closing Date), Adverse Condition Claim Period. If Seller may, by has given notice to BuyerPurchaser prior to Closing that it elects to attempt to correct the Alleged Adverse Condition, elect to continue attempting to remediate and if such condition to completion for up to Alleged Adverse Condition is not corrected on or before one hundred eighty (180) Days after the Adverse Condition Diligence Review Deadline. Closing, then, upon Seller’s remediation receipt of any Alleged Adverse Condition may not materially interfere with the use written notice from Purchaser of operation of the affected Property. If Seller does not remediate an Alleged Adverse Condition such non-completion, given within thirty (30) Days following such one hundred eighty (180) Day period, Buyer shall give and subject to the right of Seller written notice of such failure or non-completion and within five (5) Business Days following the earlier to occur of the date that (i) Seller and Buyer agree in writing on the existence and value of the Alleged Adverse Condition or (ii) resolution of any dispute regarding the existence or value of the Alleged Adverse Condition initiate binding arbitration in accordance with the provisions of set forth in Article 5.4XVIII to resolve any dispute regarding any such alleged non-completion, Seller shall pay to Buyer Purchaser, subject to Section 5.2(e) and the applicable Adverse Condition Cap, an amount equal to the value of remaining Prudent Cost Response for such Alleged Adverse Condition, if any, and such payment shall be treated as so agreed or determinedan adjustment to the Purchase Price for all Tax purposes. 5.2.3 (c) If the Parties are unable to agree as to the existence, validity, value or resolution of one or more of the Alleged Adverse Conditions prior to the Closing (such inability to agree, an “Adverse Condition Dispute”), then (subject to Sections 15.2, 15.3 and 17.1) Purchaser shall be obligated to Close and, except as to Alleged Adverse Conditions of which Seller has given notice to Purchaser that it elects to attempt to correct (as provided above), the Purchased Asset shall remain a Purchased Asset acquired by Purchaser and the Purchase Price shall be reduced by an amount equal to the lesser of the Good Faith Allocation of such Purchased Asset and the Prudent Cost Response for such Alleged Adverse Condition; provided however, that any such Purchase Price reductions shall be subject to Section 5.2(e) and shall not exceed the applicable Adverse Condition Cap; provided further, that either Party may initiate, within thirty (30) Days after the Closing (but not later), binding arbitration in accordance with the provisions set forth in Article XVIII to resolve any dispute regarding any Alleged Adverse Condition or the Prudent Cost Response thereof, except as to Alleged Adverse Conditions of which Seller has given notice that it elects to attempt to cure (as provided in Section 5.2(b)). Notwithstanding the foregoing sentence, either Party may initiate, within thirty (30) Days after the one hundred eighty (180) Day cure period (but not later), binding arbitration in accordance with the provisions set forth in Article XVIII to resolve any dispute regarding the failure to pursue diligently a cure or completion of the cure of an Alleged Adverse Condition can that Seller has elected to cure. (d) Notwithstanding anything to the contrary in Article XVIII, any arbitration initiated under this Section 5.2 shall be remediated, exclusively and finally resolved by a single arbitrator if the adjustments or payments with respect to that Alleged Adverse Condition Dispute involves less than Five Million Dollars ($5,000,000) and by a panel of three arbitrators if the Adverse Condition Dispute involves more than Five Million Dollars ($5,000,000). Any such arbitrator (the “Environmental Referee”) shall be an environmental attorney(s) with at least ten (10) years experience in oil and gas facility environmental matters, shall have not exceed at any point in the Prudent Cost Responsepast ten (10) years represented or been adverse to either Party or any of their Affiliates and shall be selected by mutual agreement of Purchaser and Seller within thirty (30) Days after the initiation of binding arbitration under Article XVIII, and absent such agreement, shall be selected by the Houston, Texas regional office of the AAA upon written request of either Party. Except as otherwise provided in the two preceding sentences, Adverse Condition Dispute arbitrations shall be conducted in accordance with Article XVIII. 5.2.4 (e) Notwithstanding anything contained in this Agreement to the contrarycontrary but subject to Seller’s indemnification obligations set forth in Sections 8.2, Buyer 8.4 and 8.6, Purchaser shall not be entitled to a Purchase Price adjustment, an adjustment indemnity or any other remedy relating to any an Adverse Condition unless (i) a Claim for the Alleged Adverse Condition unless is asserted by Purchaser within the Adverse Condition Claim Period, (ii) the amount of the Prudent Cost Response for such individual Alleged Adverse Condition exceeds a threshold amount of Three Hundred Fifty Thousand Dollars ($350,000) (the “Adverse Condition Threshold Amount”), and until (iii) the aggregate value of all Aggregate Transaction Claims for which Seller is responsible exceeds the DeductibleAggregate Deductible Amount (it being acknowledged and agreed that, and then only subject to the extent such Aggregate Transaction Claims exceeds the Deductible; provisions of Sections 8.2, 8.4 and Buyer 8.6, Purchaser shall be solely responsible for and bear all costs and expenses or loss of value associated with any each individual Alleged Adverse Condition asserted by Purchaser hereunder up to the Adverse Condition Threshold Amount and all for the aggregate of the Alleged Adverse Conditions to the extent they do not, when combined with the other Aggregate Transaction Claims up for which Seller is responsible, exceed the Aggregate Deductible Amount or, when combined with the other Alleged Adverse Conditions, to the Deductibleextent they exceed the applicable Adverse Condition Cap). No payment Seller’s election to attempt to cure, or to provide indemnity against an Alleged Adverse Condition, shall be due not constitute a waiver of Seller’s right to dispute the existence, nature or value of, or cost to cure, the Alleged Adverse Condition. Notwithstanding anything in this Agreement to the contrary, Purchaser may not assert an Alleged Adverse Condition with respect to any a Purchased Asset (x) of which it is the operator or (y) in which it owns an interest and with respect to which it is aware of such Alleged Adverse Condition for which Seller, at its option, delivers to Buyer an indemnity agreement in favor of Buyer in accordance with Article 5.2.1, nor shall any Alleged Adverse Condition for which Seller has indemnified Buyer be included as an Aggregate Transaction ClaimCondition.

Alleged Adverse Conditions. (a) As soon as reasonably practical practicable (and on an ongoing basis), but no later than one hundred twenty (120) Days after the Advance Closing Date (the “Adverse Condition Conditions Diligence Review Deadline”), Buyer shall notify Seller of any conditions that might constitute Alleged Adverse Conditions. Buyer’s notice of such conditions must include (i) a description of each individual condition to which Buyer takes exception (including any and all supporting documentation) and (ii) an estimate of the costs Buyer in good faith attributes to bringing bring such condition into compliance with applicable Environmental Laws. Seller and Buyer shall meet from time to time-to-time to attempt to agree on a resolution of Alleged Adverse Conditions. 5.2.1 (b) If the Parties are unable to agree on resolution of any Alleged Adverse Conditions on or before sixty (60) Days after the Adverse Condition Diligence Review Deadline, Seller has the option, in its sole discretion, to either (ai) bring the Alleged Adverse Condition into compliance with Environmental Laws (as in effect as of the Exchange Closing Date); or (bii) deliver to Buyer an indemnity agreement in favor of Buyer Group, upon terms reasonably acceptable to Buyer, fully releasing Buyer Group from and protecting, defending, indemnifying and holding Buyer Group harmless from and against all Environmental Claims arising from or relating to such Alleged Adverse Condition. 5.2.2 (c) If Seller elects, at its sole cost, to bring any Alleged Adverse Condition into compliance with Environmental Laws (as in effect as of the Exchange Closing Date), Seller may, by notice to Buyer, elect to continue attempting to remediate such condition to completion for up to one hundred eighty (180) Days after the Adverse Condition Diligence Review Deadline. Seller’s remediation of any Alleged Adverse Condition may not materially interfere with the use of operation of the affected Property. If Seller does not remediate an Alleged Adverse Condition within such period, Buyer shall give Seller written notice of such failure or non-completion and within five (5) Business Days following the earlier to occur of the date that (i) Seller and Buyer agree in writing on the existence and value of the Alleged Adverse Condition or (ii) resolution of any dispute regarding the existence or value of the Alleged Adverse Condition in accordance with the provisions of Article 5.4, Seller shall pay to Buyer an amount equal to the value of such Alleged Adverse Condition, if any, as so agreed or determined. 5.2.3 (d) If an Alleged Adverse Condition can be remediated, the adjustments or payments with respect to that Alleged Adverse Condition shall not exceed the Prudent Cost Response. 5.2.4 (e) Notwithstanding anything contained in this Agreement to the contrary, Buyer shall not be entitled to an adjustment or other remedy relating to any Alleged Adverse Condition unless and until the aggregate value of all Aggregate Transaction Claims exceeds the Deductible, and then only to the extent such Aggregate Transaction Claims exceeds the Deductible; and Buyer shall be solely responsible for and bear all costs and expenses associated with any and all Aggregate Transaction Claims up to the Deductible. No payment shall be due with respect to any Alleged Adverse Condition for which Seller, at its option, delivers to Buyer an indemnity agreement in favor of Buyer in accordance with Article 5.2.1, 5.2(b) nor shall any Alleged Adverse Condition for which Seller has indemnified Buyer be included as an Aggregate Transaction Claim.

Alleged Adverse Conditions. As 5.2.1 Subject to Section 5.2.6, as soon as reasonably practical (and on an ongoing basis)practicable, but no not later than one hundred twenty the earlier of: (120i) five (5) Business Days prior to the Closing Date, and (ii) forty-five (45) Days after the Closing Signing Date (such time period, the “Adverse Condition Diligence Review DeadlineClaim Period”), Buyer shall may notify Seller in writing of any conditions that might constitute Adverse Conditions with respect to any of the Properties (each, an “Alleged Adverse ConditionsCondition”). Buyer’s notice of such conditions must asserting Alleged Adverse Conditions shall include (i) a complete description of each individual condition to which Buyer takes exception and full explanation (including copies of any and all supporting documentationdocumentation associated therewith) of each individual Alleged Adverse Condition being claimed and (ii) an estimate of the costs Prudent Cost Response that Buyer in good faith attributes to bringing such condition into compliance with applicable Environmental LawsLaws (such notice, an “Adverse Condition Notice”). Seller and Buyer The Parties shall meet from time to time to as necessary in an attempt to agree on a resolution of Alleged Adverse Conditions. 5.2.1 If the Parties are unable with respect to agree on resolution of any outstanding Alleged Adverse Conditions on or before sixty (60) Days after the Adverse Condition Diligence Review Deadline, timely raised hereunder. 5.2.2 Seller has the optionright, in its sole discretionbut not the obligation, to either (a) bring the Alleged Adverse Condition into compliance with Environmental Laws (as in effect as of the Closing Date); or (b) deliver to Buyer an indemnity agreement in favor of Buyer Group, upon terms reasonably acceptable to Buyer, fully releasing Buyer Group from and protecting, defending, indemnifying and holding Buyer Group harmless from and against all Environmental Claims arising from or relating to such Alleged Adverse Condition. 5.2.2 If Seller electsattempt, at its sole cost, to bring cure or remove any Alleged Adverse Condition into compliance with Environmental Laws respect to the Properties of which it has been duly advised by Buyer during the Adverse Condition Claim Period or Xxxxxxx Plant Adverse Conditions Claim Period (as applicable). If prior to Closing or, solely with respect to Adverse Condition Notices delivered in effect as accordance with Section 5.2.6, if within ten (10) Business Days after the end of the Closing Date)Xxxxxxx Plant Adverse Conditions Claim Period, Seller mayhas given notice to Buyer that it elects to attempt to correct the Alleged Adverse Condition, then Seller may elect, by written notice to BuyerBuyer prior to the Closing, elect to continue attempting to remediate correct such condition to completion for up to following Closing; provided that if such Alleged Adverse Condition is not corrected on or before one hundred eighty (180) Days after the Closing or one hundred eighty (180) Days after the end of the Xxxxxxx Plant Adverse Condition Diligence Review Deadline. Seller’s remediation of any Alleged Adverse Condition may not materially interfere with the use of operation of the affected Property. If Seller does not remediate an Alleged Adverse Condition within such period, Buyer shall give Seller written notice of such failure or non-completion and within five (5) Business Days following the earlier to occur of the date that Claim Period: (i) Seller and Buyer agree in writing on the existence and value of the with respect to Alleged Adverse Condition Conditions raised pursuant to Section 5.2.6 or (ii) resolution of any dispute regarding if the existence or value of the Alleged Adverse Condition Threshold Amount is first exceeded during the Xxxxxxx Plant Adverse Condition Claim Period, then, upon Seller’s receipt of written notice from Buyer of such non-completion given within thirty (30) Days following the end of such one hundred eighty (180) Day period, and subject to the right of Seller to initiate binding arbitration in accordance with the provisions of set forth in Article 5.418 to resolve any dispute regarding any such alleged non-completion, Seller shall pay to Buyer Buyer, subject to Section 5.2.5, an amount equal to the value of remaining Prudent Cost Response for such Alleged Adverse Condition, if any, as so agreed or determined. 5.2.3 If the Parties are unable to agree as to the existence, validity, value or resolution of one or more of the 1) Buyer shall be obligated to Close and, except as to Alleged Adverse Conditions of which Seller has given notice to Buyer that it elects to correct (as provided above), at Seller’s election either: (i) the affected Property shall be an Excluded Property and the Purchase Price shall be reduced by the Good Faith Allocation of such Property, (ii) subject to Section 5.2.5, Seller shall indemnify Buyer pursuant to Section 8.3.2 and the Property shall remain a Property acquired by Buyer without any adjustment of the Purchase Price or (iii) subject to Section 5.2.5, the Property shall remain a Property acquired by Buyer and the Purchase Price shall be reduced by an amount equal to the lesser of the Good Faith Allocation of such Property and the Prudent Cost Response for such Alleged Adverse Condition; provided however, that either Party may initiate, within sixty (60) Days after Closing (but not later), binding arbitration in accordance with the provisions set forth in Article 18 to resolve any dispute arising prior to Closing regarding any Alleged Adverse Condition or the Prudent Cost Response thereof, except as to Alleged Adverse Conditions of which Seller has given notice that it elects to cure (as provided in Section 5.2.2). Notwithstanding the foregoing sentence, either Party may initiate, within sixty (60) Days after the one hundred eighty (180) Day cure period (but not later), binding arbitration in accordance with the provisions set forth in Article 18 to resolve any dispute regarding the failure to pursue diligently a cure or completion of the cure of an Alleged Adverse Condition can be remediated, the adjustments or payments with respect that Seller has elected to that Alleged Adverse Condition shall not exceed the Prudent Cost Responsecure. 5.2.4 Notwithstanding anything to the contrary in Article 18, any arbitration initiated under this Section 5.2 shall be exclusively and finally resolved by a single arbitrator if the Adverse Condition Dispute involves less than Five Million Dollars ($5,000,000) and by a panel of three arbitrators if the Adverse Condition Dispute involves more than Five Million Dollars ($5,000,000). Any such arbitrator (the “Environmental Referee”) shall be an environmental attorney(s) with at least ten (10) years experience in oil and gas facility environmental matters, shall have not at any point in the past ten (10) years represented or been adverse to either Party (or any of their Affiliates) and shall be selected by mutual agreement of Buyer and Seller within thirty (30) Days after the initiation of binding arbitration under Article 18, and absent such agreement, shall be selected by the Houston, Texas regional office of the AAA upon written request of either Party. Except as otherwise provided in the two preceding sentences, Adverse Condition Dispute arbitrations shall be conducted in accordance with Article 18. 5.2.5 Notwithstanding anything contained in this Agreement to the contrarycontrary but subject to Seller’s indemnification obligations set forth in Sections 8.2, 8.3 and 8.6, Buyer shall not be entitled to a Purchase Price adjustment, an adjustment indemnity or any other remedy relating to any an Adverse Condition unless (i) a Claim for the Alleged Adverse Condition unless is asserted by Buyer within the Adverse Condition Claim Period or the Xxxxxxx Plant Adverse Conditions Claim Period (as applicable), (ii) the amount of the Prudent Cost Response for such individual Alleged Adverse Condition exceeds a threshold amount of One Million Dollars ($1,000,000) (the “Adverse Condition Threshold Amount”), and until (iii) the aggregate value of all Aggregate Transaction Claims for which Seller is responsible exceeds the DeductibleAggregate Deductible Amount (it being acknowledged and agreed that, and then only subject to the extent such Aggregate Transaction Claims exceeds the Deductible; provisions of Sections 8.2, 8.3 and 8.6, Buyer shall be solely responsible for and bear all costs and expenses or loss of value associated with any each individual Alleged Adverse Condition asserted by Buyer hereunder up to the Adverse Condition Threshold Amount and all for the aggregate of the Alleged Adverse Conditions to the extent they do not, when combined with the other Aggregate Transaction Claims up for which Seller is responsible, exceed the Aggregate Deductible Amount). Seller’s election to attempt to cure, or to provide indemnity against an Alleged Adverse Condition, shall not constitute a waiver of Seller’s right to dispute the existence, nature or value of, or cost to cure, the Alleged Adverse Condition. Notwithstanding anything in this Agreement to the Deductible. No payment shall be due contrary, Buyer may not assert an Alleged Adverse Condition with respect to a Property (i) of which it is the operator or (ii) in which it owns an interest and with respect to which it is aware of such Alleged Adverse Condition. 5.2.6 Notwithstanding anything otherwise provided in this Section 5.2.6, Buyer shall have the right to provide Seller an Adverse Condition Notice related solely to the Xxxxxxx Plant for a period beginning on the Day Seller gives Buyer written notice that Seller has completed the Xxxxxxx Plant Remediation Project and ending on the Day which is thirty (30) Days later (the “Xxxxxxx Plant Adverse Conditions Claim Period”). Except as otherwise expressly provided in this Section 5.2.6, any Alleged Adverse Condition for which Seller, at its option, delivers Conditions related to Buyer an indemnity agreement the Xxxxxxx Plant shall be subject to the procedures set forth in favor of Buyer in accordance with Article 5.2.1, nor shall any Alleged Adverse Condition for which Seller has indemnified Buyer be included as an Aggregate Transaction ClaimSection 5.2.

Alleged Adverse Conditions. As soon as reasonably practical (and on -------------------------- an ongoing basis), but in no event later than one hundred twenty and eighty (120180) Days after the Closing Date (the “Adverse Condition Diligence Review Deadline”)Closing, Buyer shall notify Seller of any conditions that might constitute Properties which are subject to Alleged Adverse ConditionsCondition(s). Buyer’s 's notice of such conditions must Alleged Adverse Condition(s) shall include (i) a complete description of each individual condition to which Buyer takes exception (including any and all supporting documentationdocumentation associated therewith) and (ii) an estimate of the costs which Buyer in good faith attributes to bringing such condition into compliance with applicable Environmental Lawsremediating the same. Buyer and Seller and Buyer shall meet from time to time to as necessary in an attempt to mutually agree on a proposed resolution of with respect to the Alleged Adverse Conditions. 5.2.1 If Condition(s) raised by Buyer. The value allocated to each Property as set forth on Exhibit "B" and the Parties are unable costs to agree on resolution cure such adverse condition shall be used by the parties to determine the amount of any adjustment, if any, due to the existence of an Alleged Adverse Conditions on or before sixty (60Condition. It is recognized that good faith differences of opinion may exist between Buyer and Seller in connection with the Alleged Adverse Condition(s) Days after the Adverse Condition Diligence Review Deadlineraised by Buyer, Seller has the optionincluding without limitation, in its sole discretion, to either disputes as to: (a) bring whether or not the alleged defect constitutes an Alleged Adverse Condition .9.1 respectively, (c) whether or not the Alleged Adverse Condition into compliance with Environmental Laws raised by Buyer was properly and timely asserted by Buyer pursuant to this Article, and/or (as in effect as d) the adjustment, if any, on account of the Closing Date); or (b) deliver to Buyer an indemnity agreement in favor of Buyer Group, upon terms reasonably acceptable to Buyer, fully releasing Buyer Group from and protecting, defending, indemnifying and holding Buyer Group harmless from and against all Environmental Claims arising from or relating to such Alleged Adverse Condition. 5.2.2 If Seller elects, at its sole cost, to bring any Alleged Adverse Condition into compliance with Environmental Laws (as in effect as of the Closing Date), Seller may, by notice to Buyer, elect to continue attempting to remediate such condition to completion for up to one hundred eighty (180) Days after the Adverse Condition Diligence Review Deadline. Seller’s remediation of any Alleged Adverse Condition may not materially interfere with the use of operation of the affected Property. If Seller does not remediate any such difference of opinion regarding an Alleged Adverse Condition raised by Buyer is not resolved by mutual agreement of Buyer and Seller, either party shall have the right, exercisable within such periodtwo hundred seventy (270) Days after Closing, Buyer shall give Seller written notice of such failure or non-completion and within five (5) Business Days following the earlier to occur of the date that (i) Seller and Buyer agree in writing on the existence and value of the Alleged Adverse Condition or (ii) resolution of any dispute regarding the existence or value of the Alleged Adverse Condition initiate binding arbitration in accordance with the provisions of Article 5.4, Seller shall pay to Buyer an amount equal to the value of such Alleged Adverse Condition, if any, as so agreed or determined18. 5.2.3 If an Alleged Adverse Condition can be remediated, the adjustments or payments with respect to that Alleged Adverse Condition shall not exceed the Prudent Cost Response. 5.2.4 1. Notwithstanding anything contained in this Agreement to the contrarycontrary (including Article 18.1), if Seller disagrees with the decision of the arbitration panel, Seller shall have the right (but not the obligation) to: (i) remediate, at Seller's sole cost, the Property at issue to a point where it is in compliance with the Laws, or (ii) require the reassignment of the Property at issue from Buyer to Seller. If Seller elects to require the reassignment of the Property at issue, Buyer shall not be entitled and Seller will take all necessary action (including without limitation, execution of documentation and conducting an accounting) required to an adjustment or other remedy relating to any Alleged Adverse Condition unless and until place the aggregate value of all Aggregate Transaction Claims exceeds the Deductible, and then only to the extent such Aggregate Transaction Claims exceeds the Deductible; and Buyer shall be solely responsible for and bear all costs and expenses associated with any and all Aggregate Transaction Claims up to the Deductible. No payment shall be due parties back into a position with respect to any Alleged Adverse Condition for which Seller, the Property at its option, delivers issue just prior to Buyer an indemnity agreement in favor of Buyer in accordance with Article 5.2.1, nor shall any Alleged Adverse Condition for which Seller has indemnified Buyer be included as an Aggregate Transaction ClaimClosing.