Common use of Net Xxxxx Clause in Contracts

Net Xxxxx. Subject to the performance by Non-Operator of its obligations, and the accuracy of its representations and warranties, herein contained (including but not limited to those set forth in Section 2.3 hereof, this Section 2.8 and Section 3.2 hereof) and subject to the provisions of Section 14 hereof, Operator shall drill the minimum number of Xxxxx set forth in the Leases to keep each such Lease in full force and effect during the Initial Period and, if applicable, during the Option Period and, except with respect to the minimum number of Xxxxx to be drilled prior to March 31, 2005 and one (1) Well to be drilled under the Brimstone Lease on or before June 1, 2005 as set forth in Exhibit B, Operator shall commence the drilling of such minimum number of Xxxxx no later than ninety (90) days prior to the dates set forth in each of the Leases to keep each of the Leases in full force and effect during the Initial Period and, if applicable, during the Option Period. Notwithstanding the provisions of the foregoing sentence, (i) if Non-Operator substitutes a new Operator under Section 11.2 hereof, Operator shall have no obligation, nor right, to drill any additional Xxxxx and (ii) if the expiration of the Initial Period or, if applicable, the Option Period, occurs during a period when a Lease provides a minimum number of Xxxxx is to be drilled to keep such Lease in full force and effect, the obligation of Operator to drill the minimum number of Xxxxx to keep such Lease in full force and effect shall be prorated based upon the time of such period prior to, and after, the expiration of the Initial Period and, if applicable, the Option Period; for example, if the period in the Lease during which a minimum number of Xxxxx to be drilled is from January 1 of a year to December 31 of such year and the minimum number of Xxxxx to be drilled in such period is ten (10), then in the calendar year 2007, Operator shall have an obligation to drill only five (5) Xxxxx if the Option Period is not applicable. Failure of the Operator to drill the minimum number of Xxxxx as set forth above in the preceding paragraph shall result in the immediate termination of Operator's right to thereafter drill any Well and, except as set forth below, Operator's right or obligation to participate in any Well thereafter drilled, provided, however, that if after such termination, Non-Operator drills, or causes to be drilled, any Xxxxx during the Initial Period or if applicable, the Option Period, to satisfy the minimum number of Xxxxx as set forth in the preceding paragraph to be drilled in such period, Operator shall participate in each such Well drilled no deeper than one hundred (100) feet below the Chattanooga Shale formation (or such deeper formation to which such Well is required to be drilled by a Lease) for such working interests, if any, as Non-Operator shall notify Operator in writing prior to the drilling of such Well and Operator shall be responsible for, and shall pay, its Proportionate Share of the Drilling Costs, Operating Expenses and Operator's Fee for such Well; the termination of the rights of Operator set forth above and the right of Non-Operator to require Operator to participate in the minimum number of Xxxxx drilled no deeper than one hundred (100) feet below the Chattanooga Shale formation (or such deeper formation to which such Well is required to be drilled by a Lease) shall be the sole and exclusive remedy of Non-Operator with respect to Operator's failure to drill the minimum number of Xxxxx as set forth above in the preceding paragraph. Non-Operator represents and warrants, to the best of its knowledge, to and for the benefit of Operator and its successors and assigns that no person, corporation or other entity, other than Non-Operator, has the right to explore for or produce natural gas or oil (including the right to drill, complete and operate Xxxxx for the production, compression, transportation, marketing and sale of natural gas and oil produced therefrom) from the property subject to the Leases identified in Exhibit B other than the 1.628 acre, more or less, portion of the tract covered by the Coal Creek Lease described in Exhibit B under the heading Excluded Acreage. Non-Operator agrees that during the Initial Period, and if applicable, during the Option Period, Non-Operator shall not grant, assign or otherwise transfer to any person, corporation or other entity, except to Operator as set forth herein, the right to explore for and produce natural gas or oil from the property subject to the Leases not including methane gas from coal beds and coal mines. Notwithstanding anything to the contrary contained in this Agreement, upon the expiration of the Initial Period and, if applicable, the Option Period, Operator shall have no obligation or right to drill any well, and shall have no right to participate in any well drilled thereafter, on the property subject to any Lease.

Net Xxxxx. Subject to the performance by Non-Operator of its obligations, and the accuracy of its representations and warranties, herein contained (including but not limited to those set forth in Section 2.3 hereof, this Section 2.8 and Section 3.2 hereof) and subject to the provisions of Section 14 hereof, Operator shall drill the minimum number of Xxxxx set forth in the Leases to keep each such Lease in full force and effect during the Initial Period and, if applicable, during the Option Period and, except with respect to the minimum number of Xxxxx to be drilled prior to March 31, 2005 and one (1) Well to be drilled under the Brimstone Lease on or before June 1, 2005 as set forth in Exhibit B, Operator shall commence the drilling of such minimum number of Xxxxx no later than ninety (90) days prior to the dates set forth in each of the Leases to keep each of the Leases in full force and effect during the Initial Period and, if applicable, during the Option Period. Notwithstanding the provisions of the foregoing sentence, (i) if Non-Operator substitutes a new Operator under Section 11.2 hereof, Operator shall have no obligation, nor right, to drill any additional Xxxxx and (ii) if the expiration of the Initial Period or, if applicable, the Option Period, occurs during a period when a Lease provides a minimum number of Xxxxx is to be drilled to keep such Lease in full force and effect, the obligation of Operator to drill the minimum number of Xxxxx to keep such Lease in full force and effect shall be prorated based upon the time of such period prior to, and after, the expiration of the Initial Period and, if applicable, the Option Period; for example, if the period in the Lease during which a minimum number of Xxxxx to be drilled is from January 1 of a year to December 31 of such year and the minimum number of Xxxxx to be drilled in such period is ten (10), then in the calendar year 2007, Operator shall have an obligation to drill only five (5) Xxxxx if the Option Period is not applicable. Failure of the Operator to drill the minimum number of Xxxxx as set forth above in the preceding paragraph shall result in the immediate termination of Operator's ’s right to thereafter drill any Well and, except as set forth below, Operator's ’s right or obligation to participate in any Well thereafter drilled, provided, however, that if after such termination, Non-Operator drills, or causes to be drilled, any Xxxxx during the Initial Period or if applicable, the Option Period, to satisfy the minimum number of Xxxxx as set forth in the preceding paragraph to be drilled in such period, Operator shall participate in each such Well drilled no deeper than one hundred (100) feet below the Chattanooga Shale formation (or such deeper formation to which such Well is required to be drilled by a Lease) for such working interests, if any, as Non-Operator shall notify Operator in writing prior to the drilling of such Well and Operator shall be responsible for, and shall pay, its Proportionate Share of the Drilling Costs, Operating Expenses and Operator's ’s Fee for such Well; the termination of the rights of Operator set forth above and the right of Non-Operator to require Operator to participate in the minimum number of Xxxxx drilled no deeper than one hundred (100) feet below the Chattanooga Shale formation (or such deeper formation to which such Well is required to be drilled by a Lease) shall be the sole and exclusive remedy of Non-Operator with respect to Operator's ’s failure to drill the minimum number of Xxxxx as set forth above in the preceding paragraph. Non-Operator represents and warrants, to the best of its knowledge, to and for the benefit of Operator and its successors and assigns that no person, corporation or other entity, other than Non-Operator, has the right to explore for or produce natural gas or oil (including the right to drill, complete and operate Xxxxx for the production, compression, transportation, marketing and sale of natural gas and oil produced therefrom) from the property subject to the Leases identified in Exhibit B other than the 1.628 acre, more or less, portion of the tract covered by the Coal Creek Lease described in Exhibit B under the heading Excluded Acreage. Non-Operator agrees that during the Initial Period, and if applicable, during the Option Period, Non-Operator shall not grant, assign or otherwise transfer to any person, corporation or other entity, except to Operator as set forth herein, the right to explore for and produce natural gas or oil from the property subject to the Leases not including methane gas from coal beds and coal mines. Notwithstanding anything to the contrary contained in this Agreement, upon the expiration of the Initial Period and, if applicable, the Option Period, Operator shall have no obligation or right to drill any well, and shall have no right to participate in any well drilled thereafter, on the property subject to any Lease.