Common use of Notice of Title Defects Clause in Contracts

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify Seller as promptly as possible, but no later than the expiration of the Examination Period of such alleged Title Defect. To be effective, such notice must (i) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on the expiration date of the Examination Period and (iii) describe the Title Defect in reasonable detail, to the extent then reasonably known by Buyer (including the estimated value of such Title Defect as determined by Buyer). Any matters that may otherwise constitute Title Defects, but of which Seller has not been notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon the receipt of such effective notice from Buyer, Seller, at Seller’s option, shall (i) subject to Section 3.05(a), attempt to cure such Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as set forth on Exhibit C. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well or unit or Well location is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit C, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. Buyer shall provide Seller notice of all purported Title Defects no later than 11:59 p.m. Central Time on the Notification Date; provided, however, that (a1) If Buyer discovers agrees that it will use reasonable efforts to furnish Seller, at the end of each week until the Notification Date, written notice of any Title Defect affecting that Buyer discovers or learns about during that week, which notice may be preliminary in nature and supplemented prior to the Notification Date, and (2) the failure of Buyer to give Seller such preliminary notice will not waive any Asset, Buyer shall notify Seller as promptly as possible, but no later than the expiration Title Defects or constitute a breach of the Examination Period of such alleged Title Defectthis Agreement. To be effective, such notice must (ia) be in writing, (iib) be received by Seller by 5:00 p.m. Central Standard Time on or prior to the expiration date of the Examination Period and Notification Date, (iiic) describe the Title Defect in reasonable detaildetail (including any alleged variance in the Net Revenue Interest or Working Interest), to (d) identify the extent then reasonably known specific Asset or Assets affected by such Title Defect, (e) include the Title Defect Value and supporting calculations prepared by Buyer in good faith, (f) Buyer’s suggested means to address the Title Defect, including any suggested curative work, and (g) comply with the estimated value of such limitations and Title Defect as determined by Buyer)Value qualifications set forth in Section 4.14. Any matters identified by Buyer prior to or on the Notification Date that may otherwise constitute Title Defects, but of which Seller has not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Encumbrances and Assumed Obligations. On December 17, 2012, the Parties shall meet and determine upon which of the Title Defects, Title Defect Values, and methods of cure the Parties have reached agreement. “Net Revenue Interest” means with respect to any Asset as of the Effective Time, the interest in and to all Hydrocarbons produced, saved, and sold from or allocated to such Asset, after giving effect all royalties, overriding royalties, production payments, carried interests, net profits interests, reversionary interests, and other burdens upon, measured by, or payable out of, production therefrom. “Working Interest” means with respect to any Asset as of the Effective Time the interest in and to such Asset that is burdened with the obligation to bear and pay costs and expenses of maintenance, development, or operations on or in connection with such Asset. Upon the receipt of such effective notice from Buyer, Seller, at Seller’s Seller shall have the option, shall but not the obligation, for a period ending ninety (i90) subject to Section 3.05(a), attempt days after the Closing to cure such Title Defect. If Seller should not elect to cure a Title Defect, and no aspect of such Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce is reasonably in dispute, the Purchase Price by the Allocated Value of shall be adjusted for such affected Asset as set forth on Exhibit C. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well or unit or Well location is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit C, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify provide Seller as promptly as possible, but notice of all Title Defects no later than 5:00 p.m. MST on the expiration of date which is seven (7) days prior to the Examination Period of such alleged Closing Date (the “Title DefectClaim Date”). To be effective, such notice must (ia) be in writing, (iib) be received by Seller by 5:00 p.m. Central Standard Time on or prior to the expiration date of the Examination Period and Title Claim Date, (iiic) describe the Title Defect in reasonable detaildetail (including any alleged variance in the Net Revenue Interest or Working Interest), to (d) identify the extent then specific Asset or Assets affected by such Title Defect, (e) include the Title Defect Value, as reasonably known determined by Buyer in good faith, and (including f) comply with the estimated value of such limitations and Title Defect as determined by Buyer)Value qualifications set forth in Section 4.14. Any matters identified by Buyer during the Examination Period that may otherwise constitute Title Defects, but of which Seller has not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Encumbrances and Assumed Obligations hereunder. Upon receipt of notices of Title Defects, the Parties shall meet and determine upon which of the Title Defects, Title Defect Values, and methods of cure the Parties have reached agreement. Upon the receipt of such effective notice from Buyer, Seller, at Seller’s Seller shall have the option, shall but not the obligation, for a period ending ninety (i90) subject to Section 3.05(a), attempt days after the Closing to cure such defect. If Seller should not elect to cure a Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale Defect, and reduce no aspect of such defect is reasonably in dispute, the Purchase Price shall be adjusted for such defect by the Allocated Value amount of such affected Asset as set forth on Exhibit C.the Title Defect Value. (ca) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset.; (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well or unit or Well location Allocated Asset is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit CD, then the Title Defect Value shall take into account be the relative change in absolute value of the interest from Exhibit C and number determined by the appropriate following formula: Title Defect Value = A x (1-[B/C]) A = Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon for the affected Asset (including any increase in Working B = Correct Net Revenue Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify Seller of the alleged Title Defect as promptly as possible, possible but no later than the expiration of the Examination Period of such alleged Title DefectPeriod. To be effective, such this notice (a “Title Defect Notice”) must (i) be in writing, ; (ii) be received by Seller by 5:00 p.m. Central Standard Time on prior to the expiration date of the Examination Period and Period; (iii) describe the Title Defect in reasonable detailsufficient, to the extent then reasonably known by Buyer specific detail (including any alleged variance in the estimated Net Revenue Interest or Working Interest); (iv) identify the specific Asset or Assets affected by the Title Defect; and (v) include the value of such the Title Defect as determined by Buyer). Any matters that otherwise may otherwise constitute have constituted Title Defects, but of which Seller has that are not been notified by Buyer so described in a timely Title Defect Notice complying and delivered in accordance with the foregoingthis Section 4.03(a), shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon the After receipt of such an effective notice from BuyerTitle Defect Notice, Seller, at Seller’s Seller shall have the option, shall (i) subject but not the obligation, to Section 3.05(a), attempt to cure such the Title Defect at any time prior to the Closing or and to postpone the Closing Date up to thirty (ii30) exclude days beyond the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as date set forth on Exhibit C.in Section 14.01 to facilitate the cure. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the a Title Defect notices Notice shall be determined in good faith based upon the criteria set forth below: (i) If the Title Defect is a lien upon on any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well well, unit, well location or unit or Well location Lease is less than that stated in Exhibit C B or the Working Interest attributable to any Well well, unit, well location or unit or Well location Lease is greater than that stated in Exhibit CB, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C B and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.the

Notice of Title Defects. (a) If During the Title Examination Period, if Buyer discovers obtains knowledge of any Title Defect affecting any AssetLease and/or Warranty Well for which an Allocated Value has been assigned, then Buyer shall notify Seller as promptly as possible, but no later than of such alleged Title Defect on or before the expiration of the Title Examination Period of Period; provided that Buyer will assert any such alleged Title Defect that exceeds the Single Title Defect Threshold as soon as reasonably practicable upon making the determination to assert such Title Defect. To be effective, such notice must (i) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on prior to the expiration date of the Title Examination Period and Period, (iii) describe the Title Defect in reasonable detailspecific detail (including any alleged variance in the Net Revenue Interest or Working Interest), (iv) identify the specific Lease or Leases and/or Warranty Well or Warranty Xxxxx affected by such Title Defect, (v) contain copies of all written data, title opinions and other documents and written information in Buyer’s possession directly relating to the extent then alleged Title Defect and its determination of the Title Defect Value, and (vi) include the Title Defect Value, as reasonably known determined by Buyer (including the estimated value of such Title Defect as determined by Buyer)in good faith. Any matters matters, including those identified by Buyer during the Title Examination Period, that may otherwise constitute Title Defects, but of which Seller has not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) . Upon the receipt of such effective notice from Buyer, Seller, at Seller’s Seller shall have the option, shall (i) subject but not the obligation, to Section 3.05(a), attempt to cure such Title Defect at any time prior to the Closing or and shall have the right in its sole discretion to postpone the Scheduled Closing Date up to thirty (ii30) exclude days beyond the affected Asset from date specified in Section 11.01 to facilitate such cure (and the sale and reduce term “Scheduled Closing Date” shall be amended to be the Purchase Price date so extended by the Allocated Value of such affected Asset as set forth on Exhibit C.Seller). (cb) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices (the “Title Defect Value”) shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Assetsuch Lease and/or Warranty Well, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected AssetLease and/or Warranty Well. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Lease and/or Warranty Well or unit or Well location is less than that stated the Net Revenue Interest for such Lease and/or Warranty Well set forth in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in A and/or Exhibit CF, then the Title Defect Value shall take into account is the relative change in product of the interest from Exhibit C and the appropriate Allocated Value attributed to such Asset.Lease, multiplied by a fraction, the numerator of which is the difference between such Net Revenue Interest set forth in Exhibit A and/or Exhibit F and the actual Net Revenue Interest for such Lease and/or Warranty Well, and the denominator of which is such Net Revenue Interest set forth in Exhibit A and/or Exhibit F. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset Lease and/or Warranty Well (including any increase in Working Interest for which there is not a proportionate increase in the corresponding Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected AssetLease and/or Warranty Well, the portion of the Asset Lease and/or Warranty Well affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected AssetLease and/or Warranty Well, if any, and the Title Defect Values placed upon the Title Defect by Buyer and Seller. (iv) If a Title Defect is not in effect or does not adversely affect an Asset a Lease and/or Warranty Well throughout the entire productive life of such AssetLease and/or Warranty Well, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value of a Title Defect shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets Lease(s) and/or Warranty Well(s) affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers W&T will review title to the Property prior to Closing and notify KMG in writing of any Title Defect affecting any Asset, Buyer shall notify Seller it discovers as promptly soon as possiblereasonably practicable after its discovery, but in no later event more than the expiration three (3) business days after conclusion of the Examination Period of such alleged Due Diligence Period. Such notice shall describe in reasonable detail the Title Defect. To be effective, such notice must (i) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on the expiration date including W&T’s calculation of the Examination Period and (iiiAdjustment Value of the Leases(s) describe or Unit(s) affected by the Title Defect Defect, W&T’s calculation of the reduction in reasonable detail, to the extent then reasonably known by Buyer (including Base Merger Consideration for the estimated value of such Title Defect as determined by Buyer). Any matters that may otherwise constitute Title Defects, but of which Seller has not been notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon the receipt of such effective notice from Buyer, Seller, at Seller’s option, shall (i) subject to Section 3.05(a), attempt to cure such Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as set forth on Exhibit C. (c) The value attributable to each Title Defect (the “Title Defect Value”), and include all data and information in W&T’s possession or control bearing thereon. The Title Defect Value resulting from a Title Defect shall be the amount by which the Adjustment Value of the affected part(s) that of the Property (the “Title Defect Property”) is asserted by Buyer reduced as a result of the existence of such Title Defect. The Title Defect Value shall be determined in accordance with the following terms and conditions: (i) if W&T and KMG agree on the Title Defect notices Value, then that amount shall be determined based upon the criteria set forth below: Title Defect Value; (iii) If if the Title Defect is a lien upon any Assetan Encumbrance that is undisputed and liquidated in amount, then the Title Defect Value is shall be the amount reasonably expected to be necessary to be paid to remove the lien Title Defect from the affected Asset. (ii) If the Title Defect asserted is that Property; (iii) if the Net Revenue Interest attributable to Title Defect represents a discrepancy between (A) the net revenue interest for any Well or unit or Well location is less than that Title Defect Property and (B) the net revenue interest stated in the applicable Schedule to Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit CA, then the Title Defect Value shall take into account be the relative change product of the Adjustment Value of such Property, or part thereof, multiplied by a fraction, the numerator of which is the net revenue interest decrease and the denominator of which is the net revenue interest stated in the interest from applicable Schedule to Exhibit C and the appropriate Allocated Value attributed to such Asset. A; (iiiiv) If if the Title Defect represents an obligationobligation or Encumbrance upon or other defect in title to the Title Defect Property of a type not described above, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Adjustment Value of the affected AssetTitle Defect Property, the portion of the Asset Title Defect Property affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset. Title Defect Property, the values placed upon the Title Defect by W&T and KMG and such other reasonable factors as are necessary to make a proper evaluation; (ivv) If the Title Defect Value with respect to a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value Property shall be determined without duplication of any costs or losses included in another Title Defect Value calculation hereunder. ; and (vi) Notwithstanding notwithstanding anything herein to the contrarycontrary in this Section 5.6, in no event shall a the aggregate Title Defect Value Values attributable to the effects of all Title Defects upon any Title Defect Property shall not exceed the Allocated Value value of the Wxxxx, units or other Assets affected therebyTitle Defect Property. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any AssetDefect, Buyer shall promptly notify Seller as promptly as possible, but no later than thereof on or prior to the expiration of the Title Examination Period of such alleged Title DefectPeriod. To be effective, such notice must (ia “Title Defect Notice”) shall be in writingwriting and shall include (a) a description of each alleged Title Defect, (iib) be received by Seller by 5:00 p.m. Central Standard Time on the expiration date of the Examination Period and Asset or portion thereof affected thereby (iii) describe the each “Title Defect in reasonable detailProperty”), to (c) the extent then reasonably known by Buyer (including the estimated value of such Title Defect Property (which shall be the Allocated Value thereof), (d) documentation sufficient to reasonably support such asserted Title Defect, and (e) the amount which Buyer reasonably believes to be the Title Defect Amount resulting from such alleged Title Defect and the computations and information upon which Buyer’s belief is based. To give Seller an opportunity to commence reviewing and curing any Title Defects, Buyer agrees to use reasonable efforts to give Seller, each Monday following the execution of this Agreement but prior to the expiration of the Title Examination Period, written notice of all Title Defects (as determined well as any claims that would be claims under the Special Warranty set forth in Section 4.02) discovered by Buyer during the previous week, which notice may be preliminary in nature and supplemented prior to expiration of the Title Examination Period. Subject to Buyer). Any ’s rights with respect to any breach by Seller of Section 7.03, and without Buyer’s rights under Seller’s Special Warranty, any matters that may otherwise constitute Title Defects, Defects but that are not specifically disclosed to Seller pursuant to a Title Defect Notice delivered to Seller prior to the expiration of which Seller has not been notified by Buyer in accordance with the foregoing, Title Examination Period shall be deemed to have been waived by Buyer Buyer, on behalf of itself and its successors and assigns, for all purposes and shall constitute Permitted Encumbrancespurposes. (b) Upon the receipt of such effective notice from Buyer, Seller, at Seller’s option, shall (i) subject to Section 3.05(a), attempt to cure such Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as set forth on Exhibit C. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well or unit or Well location is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit C, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify Seller as promptly as possible, but no later than the expiration of the Examination Period of such alleged Title Defect. To be effective, such notice must (i) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on the expiration date of the Examination Period and (iii) describe the Title Defect in reasonable detail, to the extent then reasonably known by Buyer (including the estimated value of such Title Defect as determined by Buyer). Any matters that may otherwise constitute Title Defects, but of which Seller has not been notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon the receipt of such effective notice from Buyer, Seller, at Seller’s option, shall (i) subject to Section 3.05(a), attempt to cure such Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as set forth on Exhibit C. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well or unit or Well location is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit C, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the WxxxxXxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Prima shall provide Seller notice of all Title Defect affecting any Asset, Buyer shall notify Seller as promptly as possible, but Defects no later than 5:00 p.m. Mountain Time on March 24, 2011 (the expiration of the Examination Period of such alleged “Title DefectClaim Date”). To be effective, such notice must (ia) be in writing, (iib) be received by Seller by 5:00 p.m. Central Standard Time on or prior to the expiration date of the Examination Period and Title Claim Date, (iiic) describe the Title Defect in reasonable detail, to the extent then reasonably known by Buyer detail (including any alleged variance in the estimated value of Net Revenue Interest or Working Interest), (d) identify the specific Asset or Assets affected by such Title Defect, (e) include the Title Defect Value, as reasonably determined by Buyer)Prima in good faith, and (f) comply with the limitations and Title Defect Value qualifications set forth in Section 4.14. Any Subject to Section 12.10, any matters identified by Prima during the Examination Period that may otherwise constitute Title Defects, but of which Seller has not been specifically notified by Buyer Prima in accordance with the foregoing, shall be deemed to have been waived by Buyer each of the Buyers for all purposes and shall constitute Permitted Encumbrances. (b) Encumbrances and Assumed Obligations. Upon receipt of notices of Title Defects, Seller and Prima shall meet and determine upon which of the Title Defects, Title Defect Values, and methods of cure Seller and Prima have reached agreement. Upon its receipt of such effective notice from BuyerPrima, Seller, at Seller’s Seller shall have the option, shall but not the obligation, for a period ending thirty (i30) subject to Section 3.05(a), attempt days after the Closing to cure such Title Defect at any time prior Defect. If Seller should not elect to the Closing or (ii) exclude the affected Asset from the sale cure a Title Defect, and reduce no aspect of such defect is reasonably in dispute, the Purchase Price shall be adjusted for such defect by the Allocated Value amount of such affected Asset as set forth on Exhibit C.the Title Defect Value. (ca) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer Prima in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset.; (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well or unit or Well location is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit C, then the Title Defect Value shall take into account be the relative change in absolute value of the interest from Exhibit C and number determined by the appropriate following formula: Title Defect Value = A x (1-[B/C]) A = Allocated Value attributed to such Asset.for the affected Asset B = Correct Net Revenue Interest for the affected Asset C = Net Revenue Interest for the affected Asset as set forth on Exhibit C; (iii) If the Title Defect represents an obligation, encumbrance, burden burden, or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer Buyers is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset., and the Title Defect Values placed upon the Title Defect by Seller and Prima; (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire post Effective Time productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value.; (v) The Title Defect Value of a Title Defect shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder or in connection with the Breach of any representation and warranty hereunder.; (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets Well affected thereby.; (vii) If the Title Defect Value of an Asset is equal to the Allocated Value of such Asset, the affected Asset shall remain in the purchase and sale contemplated by this Agreement, but the Purchase Price shall be adjusted accordingly; (viii) Notwithstanding the provisions of this Section 4.03 to the contrary, the Title Defect Value of any Title Defect comprising a required consent not obtained (other than consents customarily obtained after the Closing) shall be determined pursuant to Section 4.07; and (ix) Such other factors as are reasonably necessary to make a proper evaluation. (b) The term Title Defect shall not include those matters deemed not to impair marketability in accordance with any applicable title standards for the State of Wyoming.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify Seller of alleged Title Defects as promptly as possible, but no later than the expiration of the Examination Period of such alleged Title DefectPeriod. To be effective, such notice (a “Title Defect Notice”) must (i) be in writing, ; (ii) be received by Seller by 5:00 p.m. Central Standard Time on prior to the expiration date of the Examination Period and Period; (iii) describe the Title Defect in reasonable detail, to the extent then reasonably known by Buyer reasonably-specific detail (including any alleged variance in the estimated Net Revenue Interest or Working Interest); (iv) identify the specific Asset or Assets affected by the Title Defect; and (v) include the value of such the Title Defect as determined by Buyer). Any Notwithstanding Buyer’s rights and remedies under this Agreement (including indemnification) for Seller’s breach of its representations and warranties under this Agreement, and subject to the special warranty of title in the Assignment, any matters that otherwise may otherwise constitute have constituted Title Defects, but of which Seller has that are not been notified by Buyer so described in a timely Title Defect Notice complying and delivered in accordance with the foregoingthis Section 4.04(a), shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon the receipt of such effective notice from Buyer, Seller, at Seller’s option, shall (i) subject to Section 3.05(a), attempt to cure such Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as set forth on Exhibit C. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the a Title Defect notices Notice shall be determined in good faith based upon the criteria set forth below: (i) If the Title Defect is a lien upon on any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well Well, proved project or unit or Well undeveloped location is less than that stated in Exhibit C or B, and there is a proportionate decrease in the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit CExhibit B for such Well proved project or undeveloped location, then the Title Defect Value shall take into account is the relative change in the interest from Exhibit C and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount product of the Title Defect Value shall be determined by taking into account the Allocated Value of such Asset, multiplied by a fraction, the affected numerator of which is the difference between the Net Revenue Interest set forth in Exhibit B and the actual Net Revenue Interest, and the denominator of which is the Net Revenue Interest stated in Exhibit B. For purposes of this Agreement, the term “Allocated Value” means, with respect to any Asset, the portion of the amount allocated to that Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Assetunder Section 11.01. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. Buyer shall provide Seller notice of all purported Title Defects no later than 11:59 p.m. Central Time on the Notification Date; provided, however, that (a1) If Buyer discovers agrees that it will use reasonable efforts to furnish Seller, at the end of each week until the Notification Date, written notice of any Title Defect affecting that Buyer discovers or learns about during that week, which notice may be preliminary in nature and supplemented prior to the Notification Date, and (2) the failure of Buyer to give Seller such preliminary notice will not waive any Asset, Buyer shall notify Seller as promptly as possible, but no later than the expiration Title Defects or constitute a breach of the Examination Period of such alleged Title Defectthis Agreement. To be effective, such notice must (ia) be in writing, (iib) be received by Seller by 5:00 p.m. Central Standard Time on or prior to the expiration date of the Examination Period and Notification Date, (iiic) describe the Title Defect in reasonable detaildetail (including any alleged variance in the Net Revenue Interest or Working Interest), to (d) identify the extent then reasonably known specific Asset or Assets affected by such Title Defect, (e) include the Title Defect Value and supporting calculations prepared by Buyer in good faith, (f) Buyer’s suggested means to address the Title Defect, including any suggested curative work, and (g) comply with the estimated value of such limitations and Title Defect as determined by Buyer)Value qualifications set forth in Section 4.14. Any matters identified by Buyer prior to or on the Notification Date that may otherwise constitute Title Defects, but of which Seller has not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Encumbrances and Assumed Obligations. On September 29, 2014, the Parties shall meet and determine upon which of the Title Defects, Title Defect Values, and methods of cure the Parties have reached agreement. “Net Revenue Interest” means with respect to any Asset as of the Effective Time, the interest in and to all Hydrocarbons produced, saved, and sold from or allocated to such Asset, after giving effect all royalties, overriding royalties, production payments, carried interests, net profits interests, reversionary interests, and other burdens upon, measured by, or payable out of, production therefrom. “Working Interest” means with respect to any Asset as of the Effective Time the interest in and to such Asset that is burdened with the obligation to bear and pay costs and expenses of maintenance, development, or operations on or in connection with such Asset. Upon the receipt of such effective notice from Buyer, Seller, at Seller’s Seller shall have the option, shall but not the obligation, for a period ending ninety (i90) subject to Section 3.05(a), attempt days after the Closing to cure such Title Defect. If Seller should not elect to cure a Title Defect, and no aspect of such Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce is reasonably in dispute, the Purchase Price by the Allocated Value of shall be adjusted for such affected Asset as set forth on Exhibit C. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well or unit or Well location is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit C, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer Xxxxx discovers any Title Defect affecting any Asset, Buyer shall notify Seller as promptly as possible, but Sellers no later than the expiration of the Examination Period of such alleged Title Defect. To be effective, such notice must (i) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on Sellers prior to the expiration date of the Examination Period and Period, (iii) describe the Title Defect in reasonable detailsufficient, to the extent then reasonably known by Buyer specific detail (including any alleged variance in the estimated Net Revenue Interest), (iv) identify the specific Asset or Assets affected by such Title Defect, and (v) include the value of such Title Defect as determined by Buyer). Any matters that may otherwise constitute Title Defects, but of which Seller has Sellers have not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon the receipt of such effective notice from BuyerXxxxx, SellerXxxxxxx and Xxxxx shall attempt to mutually agree on a resolution with respect to any alleged Title Defect. Sellers shall have the right, but not the obligation at Seller’s optiontheir sole cost and expense, shall (i) subject to Section 3.05(a), attempt to cure any such Title Defect at any time prior to the Closing or Closing. In the event that Sellers do not elect to cure any alleged Title Defect and Buyer and Sellers are not able to mutually agree upon the resolution of such alleged Title Defect within two (ii2) exclude Business Days after the last day of the Examination Period (which agreement may include the removal of the affected Asset from the sale and reduce this Agreement with a corresponding downward adjustment to the Purchase Price by in the amount of the Allocated Value of associated with such affected Asset as Asset), the alleged Title Defect shall be subject to the Purchase Price adjustment provisions set forth on Exhibit C.in Section 3.05. (c) The Unless Sellers and Buyer agree otherwise, the value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well or unit or Well location Subject Interest is less than that stated in Exhibit C or D, then the Title Defect Value shall be the product of the Allocated Value of the affected Subject Interest multiplied by a fraction, the numerator of which is One (1) minus the actual Net Revenue Interest held by Sellers in such Subject Interest and the denominator of which is the Net Revenue Interest stated in Exhibit D for such Subject Interest. (iii) If the Title Defect asserted is that the Working Interest attributable to any Well or unit or Well location Subject Interest is greater than that stated in Exhibit CD for which there is not a proportionate increase in Net Revenue Interest, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C D and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any AssetAsset (each, a “Title Defect Property”), Buyer shall notify Seller Sellers as promptly as possible, but no later than the expiration of the Examination Period Period, of such alleged Title Defect. To be effective, such notice must (i) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on Sellers prior to the expiration date of the Examination Period and Period, (iii) describe the Title Defect in reasonable detailsufficient, to the extent then reasonably known by Buyer specific detail (including any alleged variance in the estimated Net Revenue Interest), (iv) identify the specific Asset or Assets affected by such Title Defect, and (v) include the value of such Title Defect as determined by Buyer). Any Except for Buyer's rights under the special warranty of title contained in the Assignment, any matters that may otherwise constitute Title Defects, but of which Seller has Sellers have not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted EncumbrancesEncumbrances and shall not constitute a Title Defect. (b) Upon the receipt of such effective notice from Buyer, SellerSellers and Buyer shall attempt to mutually agree on a resolution with respect to any alleged Title Defect. Sellers shall have the right, but not the obligation, to attempt, at Seller’s optiontheir sole cost, to cure or remove on or before sixty (60) days after the expiration of the Examination Period (the “Cure Period”) any Title Defects for which Sellers have received a Title Defect notice from Buyer prior to the expiration of the Examination Period. No reduction shall be made to the Closing Payment with respect to any Title Defect properly asserted prior to the expiration of the Examination Period (the “Asserted Title Defects”) and for which Sellers have provided notice to Buyer prior to or on the Closing Date that Sellers intend to attempt to cure the Title Defect during the Cure Period or for which Sellers have provided notice to Buyer prior to or on the Closing Date that Sellers dispute the existence, in whole or in part, which notice shall include a description of the matters in dispute (any Asserted Title Defect for which Sellers properly dispute the existence, in whole or in part, a “Disputed Defect”). Subject to Section 3.05, the Title Defect Value resulting from the Asserted Title Defects asserted by Buyer and not cured by Sellers prior to Closing shall be paid to a mutually agreed escrow agent (the “Escrow Agent”) at Closing pursuant to a form of escrow agreement to be mutually agreed to prior to Closing (the “Escrow Agreement”), unless the Parties agree otherwise; provided, however, (i) if Sellers elect to cure an Asserted Title Defect, the Title Defect Value resulting from such Asserted Title Defect shall be released to Sellers upon cure if such Asserted Title Defect is cured by the expiration of the Cure Period (the “Remedy Deadline”), and if not cured by then, such Title Defect Value shall be released to Buyer or Sellers, as applicable, pursuant to Section 3.04(c), at such time, or if the relevant Asserted Title Defect becomes subject to resolution pursuant to Article XVI (a “Disputed Title Matter”), then such Title Defect Value shall be treated as provided in the following sub-part (ii), and (ii) if an Asserted Title Defect is a Disputed Defect or Disputed Title Matter, such Asserted Title Defect shall be finally and exclusively resolved in accordance with the provisions of Article XVI and release of the Title Defect Value from escrow for such Asserted Title Defect shall be resolved in accordance therewith. If, prior to the expiration of the Remedy Deadline, Sellers and Buyer cannot agree on (A) the proper and adequate cure for any such Title Defect, (B) the Title Defect Value or (C) whether the Asserted Title Defect constitutes a Title Defect, then such dispute(s) shall be finally and exclusively resolved in accordance with the provisions of Article XVI. (c) In the event that any Title Defect (other than a Disputed Title Matter) is not waived by Buyer or, subject to Section 3.05(a3.04(b), attempt cured prior to cure the Remedy Deadline, then unless otherwise mutually agreed in writing by the Parties, subject to Section 3.05, Buyer shall, at its sole election, elect to (i) retain the Title Defect Property and make a downward adjustment to the Unadjusted Purchase Price by an amount equal to the Title Defect Value of such Title Defect at any time prior to the Closing or (ii) exclude the entirety of the Title Defect Property that is adversely affected Asset from by such Title Defect and reconvey such Title Defect Property to Sellers, in which event, the sale and reduce the Unadjusted Purchase Price shall be adjusted downward, by an amount equal to the Allocated Value of such affected Asset Title Defect Property, and such Title Defect Property shall constitute an Excluded Asset. Upon Buyer making an election pursuant to this Section 3.04(c), the Parties shall complete any reconveyancing of the relevant Title Defect Property, if necessary, to effect such election. Any downward adjustment to the Unadjusted Purchase Price pursuant to this Section 3.04(c), together with any other adjustments as set forth on Exhibit C.may be required pursuant to Section 3.04(b), if applicable, shall be made (and accounted for) in connection with the preparation of the Final Accounting Statement, except for Title Defects that Sellers do not dispute or attempt to cure, which Title Defects will be accounted for at Closing. (cd) The Unless Sellers and Buyer agree otherwise, the value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any AssetAsset which is undisputed and liquidated in amount, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Acres under a Lease are less than that stated in Exhibit A or Exhibit D, the Net Revenue Interest attributable to any Lease, Well or unit or Well location is less than that stated in Exhibit C A, Exhibit B or Exhibit D or the Working Interest attributable to any Lease, Well or unit or Well location is greater than that stated in Exhibit CA, Exhibit B or Exhibit D for which there is not a proportionate increase in Net Revenue Interest, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C A, Exhibit B or Exhibit D and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest), other than as described in Sections 3.04(d)(i) and (ii) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset, and the Title Defect Value placed upon the Title Defect by Buyer and Sellers. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value of a Title Defect shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the WxxxxXxxxx, units or other Assets affected thereby. (vii) Such The Title Defect Value of a Title Defect shall be determined considering such other factors as are reasonably necessary normally considered in transactions involving the sale of properties and assets similar to make a proper evaluationthe Assets.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify Seller as promptly as reasonably possible, but no later than October 10, 2016 (the expiration of the Examination Period “Defect Notice Date”), of such alleged Title Defect. To be effective, such notice must (i) be in writing, (ii) be received by sent to Seller by 5:00 p.m. Central Standard Daylight Time on the expiration date of the Examination Period and Defect Notice Date, (iii) describe the Title Defect in reasonable detailreasonably sufficient, to the extent then reasonably known by Buyer specific detail (including any alleged variance in the estimated Net Revenue Interest), (iv) identify the specific Asset or Assets affected by such Title Defect, and (v) include the value of such Title Defect as determined by Buyer). Any matters that may otherwise constitute Title Defects, but of which Seller has not been specifically notified by Buyer in accordance with the foregoing, shall shall, subject to Seller’s special warranty of title in the Assignment, be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon the receipt of any such effective notice from Buyer, Seller, at Seller’s option, may, but shall (i) subject not be obligated to, elect to Section 3.05(a), attempt to cure such Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as set forth on Exhibit C.Closing. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any AssetAsset that is liquidated in amount, the Title Defect Value is the amount reasonably expected to be necessary to be paid to unconditionally remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well or unit or Well location Asset is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit CB, then the Title Defect Amount shall be the product of the Allocated Value shall take into account of such Asset multiplied by a fraction, the relative change numerator of which is the decrease in the interest from Exhibit C Seller’s Net Revenue Interest and the appropriate Allocated Value attributed to such Asset.denominator of which is Seller’s Net Revenue Interest stated on Exhibit B. (iii) If if a Title Defect constitutes a reduction in the aggregate number of Net Mineral Acres as to Seller’s interest in an Undeveloped Lease, then the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value Amount shall be determined equal to the product of (A) the Net Mineral Acre Price therefore multiplied by taking into account (B) the Allocated Value remainder of (1) the affected Asset, the portion number of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall Net Mineral Acres set forth on Exhibit C purported to be taken into account in determining the Title Defect Value. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, such Seller’s interest in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.such

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify Seller of the alleged Title Defect as promptly as possible, possible but no later than the expiration of the Examination Period of such alleged Title DefectPeriod. To be effective, such this notice (a “Title Defect Notice”) must (i) be in writing, ; (ii) be received by Seller by 5:00 p.m. Central Standard Time on prior to the expiration date of the Examination Period and Period; (iii) describe the Title Defect in reasonable detailsufficient, to the extent then reasonably known by Buyer specific detail (including any alleged variance in the estimated Net Revenue Interest or Working Interest); (iv) identify the specific Asset or Assets affected by the Title Defect; and (v) include the value of such the Title Defect as determined by Buyer). Any matters that otherwise may otherwise constitute have constituted Title Defects, but of which Seller has that are not been notified by Buyer so described in a timely Title Defect Notice complying and delivered in accordance with the foregoingthis Section 4.04(a), shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon the After receipt of such an effective notice from BuyerTitle Defect Notice, Seller, at Seller’s Seller shall have the option, shall (i) subject but not the obligation, to Section 3.05(a), attempt to cure such the Title Defect at any time prior to the Closing or and to postpone the Closing Date up to thirty (ii30) exclude days beyond the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as date set forth on Exhibit C.in Section 12.01 to facilitate the cure. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the a Title Defect notices Notice shall be determined in good faith based upon the criteria set forth below: (i) If the Title Defect is a lien upon on any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well well, unit, well location or unit or Well location Lease is less than that stated in Exhibit C B or the Working Interest attributable to any Well or well, unit or Well well location is greater than that stated in Exhibit CB, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C B and the appropriate Allocated Value attributed to of such Asset. (iii) If . For purposes of this Agreement, the Title Defect represents an obligationterm “Allocated Value” means, encumbrance, burden or charge upon the affected Asset (including with respect to any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidatedAsset, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the allocated to that Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Assetunder Section 11.01. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any alleged Title Defect affecting any Asset, Buyer shall notify Seller of the alleged Title Defect as promptly as possible, possible but no later than the expiration of the Examination Period of such alleged Title Defectfive (5) days before Closing. To be effective, such this notice (a “Title Defect Notice”) must (i) be in writing, ; (ii) be received by Seller by 5:00 p.m. Central Standard Time on the expiration date of the Examination Period and no later than five (5) days before Closing; (iii) describe include a description and explanation of the Title Defect in reasonable detailand the Asset affected thereby, to the extent then reasonably known (iv) include such supporting documents relied upon by Buyer (including to determine the estimated value existence of any such Title Defect (including, if applicable, a title abstract or “run-sheet”), (v) include the Allocated Value of the Asset affected by such Title Defect, and (vi) include Buyer’s good faith estimate of the Title Defect Value, and the computations upon which Buyer’s belief is based. “Title Defect Value” shall mean the amount determined in accordance with Section 4.03, as determined applicable, or as otherwise agreed to by Buyer)the Parties; provided, however, notwithstanding anything to the contrary herein, in no event shall (x) the cumulative Title Defect Values for all Title Defects affecting an Asset exceed the Allocated Value of the affected Asset, and (y) the Title Defect Value for any Title Defect duplicate, or include any amounts reflected in, the Title Defect Value for any other Title Defect for the same Asset. Any matters that otherwise may otherwise constitute have constituted Title Defects, but of which Seller has that are not been notified by Buyer so described in a timely Title Defect Notice complying and delivered in accordance with the foregoingthis Section 4.04(a), shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon , except to the receipt of such effective notice from Buyer, Seller, at Seller’s option, shall (i) subject to Section 3.05(a), attempt to cure extent such Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price by the Allocated Value Defects constitute a breach of such affected Asset as set forth on Exhibit C. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected AssetSection 4.06. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well or unit or Well location is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit C, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify provide Seller as promptly as possible, but notice of all Title Defects no later than 5:00 p.m. MST on the expiration of date which is seven (7) days prior to the Examination Period of such alleged Closing Date (the “Title DefectClaim Date”). To be effective, such notice must (ia) be in writing, (iib) be received by Seller by 5:00 p.m. Central Standard Time on or prior to the expiration date of the Examination Period and Title Claim Date, (iiic) describe the Title Defect in reasonable detaildetail (including any alleged variance in the Net Revenue Interest or Working Interest), to (d) identify the extent then specific Asset or Assets affected by such Title Defect, (e) include the Title Defect Value, as reasonably known determined by Buyer in good faith, and (including f) comply with the estimated value of such limitations and Title Defect as determined by Buyer)Value qualifications set forth in Section 4.14. Any matters identified by Xxxxx during the Examination Period that may otherwise constitute Title Defects, but of which Seller has not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Encumbrances and Assumed Obligations hereunder. Upon receipt of notices of Title Defects, the Parties shall meet and determine upon which of the Title Defects, Title Defect Values, and methods of cure the Parties have reached agreement. Upon the receipt of such effective notice from Buyer, Seller, at Seller’s Seller shall have the option, shall but not the obligation, for a period ending ninety (i90) subject to Section 3.05(a), attempt days after the Closing to cure such defect. If Seller should not elect to cure a Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale Defect, and reduce no aspect of such defect is reasonably in dispute, the Purchase Price shall be adjusted for such defect by the Allocated Value amount of such affected Asset as set forth on Exhibit C.the Title Defect Value. (ca) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset.; (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well or unit or Well location Allocated Asset is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit CD, then the Title Defect Value shall take into account be the relative change in absolute value of the interest from Exhibit C and number determined by the appropriate following formula: Title Defect Value = A x (1-[B/C]) A = Allocated Value attributed to such Asset.for the affected Asset B = Correct Net Revenue Interest for the affected Asset C = Net Revenue Interest for the affected Asset as set forth on Exhibit D. (iii) If the Title Defect represents an obligation, encumbrance, burden burden, or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset., and the Title Defect Value placed upon the Title Defect by Xxxxx and Seller; (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire post Effective Time productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value.; (v) The Title Defect Value of a Title Defect shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder.; (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets Allocated Asset affected thereby.; (vii) If the Title Defect Value of an Asset is equal to the Allocated Value of such Asset, the affected Asset shall remain in the purchase and sale contemplated by this Agreement, but the Purchase Price shall be adjusted accordingly; (viii) Notwithstanding the provisions of this Section 4.03 to the contrary, the Title Defect Value of any Title Defect comprising a required consent not obtained (other than consents customarily obtained after Closing) shall be determined subject to any accommodation implemented pursuant to Section 4.07; and (ix) Such other factors as are reasonably necessary to make a proper evaluation. (b) The term Title Defect shall not include: (i) Defects based solely on an assertion that Seller’s files lack information, provided that any missing material information can be obtained by the reasonable efforts of Buyer; (ii) Defects in the early chain of title consisting of the failure to recite marital status in a document or omissions of successors of heirship or estate proceedings, unless Xxxxx provides a reasonable basis for the assertion that such failure or omission has resulted in a third party’s actual and superior claim of title to the affected Asset; (iii) Defects arising out of lack of survey; (iv) Defects arising out of lack of corporate or other entity authorization unless Xxxxx provides a reasonable basis for the assertion that the action was not authorized and that such lack of authorization has resulted in a third party’s actual and superior claim of title to the affected Asset; (v) Defects asserting a change in an applicable Working Interest or Net Revenue Interest based on a change in drilling and spacing units, tract allocation or other changes in pooling or unit participation occurring after the date of this Agreement; and (vi) Title requirements customarily considered as advisory or which can be waived as a matter of prudent business judgment.

Notice of Title Defects. (a) If Buyer discovers any shall give Sellers written notice of all Title Defect affecting any Asset, Defects discovered by Buyer promptly upon discovery by delivering to Sellers a written “Notice of Title Defects” setting forth such Title Defects. Buyer shall notify Seller as promptly as possible, but no later than Sellers weekly of all Title Defects discovered by Buyer through the expiration of the Examination Period date of such alleged notice and not previously noticed to Sellers. The Notice of Title Defect. To be effective, such notice must Defects shall (i) be in writingdescribe the Title Defect, (ii) be received by Seller by 5:00 p.m. Central Standard Time on describe the expiration date basis of the Examination Period and Title Defect, (iii) describe include copies of any title opinion, title memoranda and other documentation supporting the basis of the Title Defect Defect, (iv) describe in reasonable detail, general terms the curative action that Buyer reasonably anticipates would need to the extent then reasonably known by Buyer (including the estimated value of such Title Defect as determined by Buyer). Any matters that may otherwise constitute Title Defects, but of which Seller has not been notified by Buyer be taken in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon the receipt of such effective notice from Buyer, Seller, at Seller’s option, shall (i) subject to Section 3.05(a), attempt order to cure such Title Defect at any time prior to Defect, and (v) describe Buyer’s good faith estimate of the Closing or (ii) exclude reduction in the affected Asset from the sale and reduce the Purchase Price Allocated Property’s Allocated Value caused by the Allocated Value Title Defect, taking into consideration the nature of such affected Asset as set forth on Exhibit C. (c) The value attributable to each the Title Defect and the likelihood that such Title Defect may actually result in a claim against or loss of title (the “Title Defect Value”) (provided that is asserted by Buyer in the Title Defect notices shall be determined based upon Value, together with the criteria set forth below: (i) If the aggregate Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest Values attributable to any Well or unit or Well location is less than that stated in Exhibit C other Title Defects affecting such Allocated Property, shall not exceed the lesser of the Allocated Property’s Allocated Value or the Working Interest attributable cost to any Well or unit or Well location is greater than that stated in Exhibit C, then cure the Title Defect Value shall take into account Defect, if the relative change in the interest from Exhibit C cost to cure is reasonably determinable) and the appropriate Allocated Value attributed to such Asset. associated calculations and documentation (iii) If the for clarity, if a Title Defect represents an obligationaffects a Well and affects a Lease, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account separately with respect to the Allocated Value of Well and the affected Asset, the portion of the Asset affected by Lease and aggregated to determine the Title Defect, the legal effect Defect Value of the Title Defect, ). The final Notice of Title Defects shall be delivered on or before the potential discounted economic effect of Defect Notice Deadline. Buyer will be deemed to have conclusively waived (A) any Title Defect about which it fails to notify Sellers in writing prior to the Defect Notice Deadline and (B) any Title Defect with respect to which the Title Defect over the life of the affected Asset. (iv) If a Title Defect Value is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining less than the Title Defect ValueThreshold. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify Seller as promptly as possibleSellers prior to 5:00 p.m., but no later than local time on or before December 18, 2012 (the expiration of the Examination Period “Defects Deadline”) of such alleged Title Defect. To be effective, such notice (a “Defects Notice”) must (i) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on Sellers prior to the expiration date of the Examination Period and Defects Deadline, (iii) describe the Title Defect in reasonable detailDefect, (iv) to the extent then reasonably known applicable, identify the specific Asset or Assets affected by Buyer such Title Defect, and (including v) include a good faith estimate of the estimated value Defect Value (defined below) of such Title Defect as determined by Buyer). Any matters that may otherwise constitute a Title DefectsDefect, but of which Seller has Sellers have not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall Buyer, except to the extent any unasserted Title Defect would constitute Permitted Encumbrances(A) a breach of the Sellers’ special warranty of title contained in the Assignment, (B) a breach of any of Sellers’ representations or warranties contained in this Agreement, or (C) a Retained Obligation (defined below). (b) Upon the receipt of such effective notice from Buyer, Seller, at Seller’s option, shall (i) subject to Section 3.05(a), attempt to cure such Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as set forth on Exhibit C. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices a Defects Notice shall be determined based upon the criteria set forth below: (i) If the if a Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset.; however, in no event may this amount exceed $3,450 per net mineral acre of the property in question; (ii) If the if a Title Defect asserted is that the Net Revenue Interest net mineral leasehold acres attributable to any Well or unit or Well location is a Lease totals less than that stated in the net mineral leasehold acres as shown on Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit CA, then the Title Defect Value thereof shall take into account be an amount equal to the relative change in product of that Lease’s per acre Allocated Value multiplied by the interest from difference between the net mineral leasehold acres attributable to that Lease as shown on Exhibit C A and the appropriate Allocated Value attributed number of net mineral leasehold acres actually attributable to such Asset.the Lease; (iii) If the if a Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset., and the Defect Values placed upon the Title Defect by Buyer and Sellers; (iv) If if a Title Defect is not then currently in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value.; (v) The the Defect Value of a Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder.; (vi) Notwithstanding notwithstanding anything herein to the contrary, in no event shall the Defect Value of a Title Defect Value may not exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby.Asset; (vii) Such Buyer’s right to assert Title Defects hereunder shall not be diminished or otherwise adversely affected by any materiality qualification contained in any of Sellers’ representations and warranties in Article V hereof; and (viii) such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any To assert a claim arising out of a breach of Section 4.9(a), the Purchaser must deliver a claim notice to the Company or Stockholder Representative (as applicable) promptly after becoming aware of a Title Defect affecting but in any Asset, Buyer shall notify Seller as promptly as possible, but event no later than 180 days following the expiration of Closing Date (the Examination Period of such alleged Title Defect“Claim Date”), except as otherwise provided under Sections 11.5 and 11.11. To Such notice shall be effective, such notice must in writing and shall include (i) be in writinga specific description of the alleged Title Defect(s), (ii) be received by Seller by 5:00 p.m. Central Standard Time on the expiration date of the Examination Period and Major Properties affected, (iii) describe supporting documents reasonably necessary for the Company or Stockholder Representative (as well as any title attorney or examiner hired by the Company) to verify the existence of the alleged Title Defect Defect(s), and (iv) the amount by which the Purchaser reasonably believes the values of the Major Properties set forth in reasonable detail, Exhibit A (the “Allocated Value”) of those Major Properties are reduced by the alleged Title Defect(s) and (v) the computations and information upon which the Purchaser’s belief is based. Notwithstanding anything to the extent then reasonably known by Buyer (including contrary, the estimated value of such Title Defect as determined by Buyer). Any matters that may otherwise constitute Title Defects, but of which Seller has not been notified by Buyer in accordance with the foregoing, Purchaser shall be deemed to have waived all breaches of Section 4.9(a) of which notice has not been waived by Buyer for all purposes and shall constitute Permitted Encumbrancesgiven on or before the Claim Date. (b) Upon the receipt of such effective notice from Buyer, Seller, at Seller’s option, shall (i) subject to Section 3.05(a), attempt to cure such Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price by The reduction in the Allocated Value of such affected Asset as set forth on Exhibit C. (c) The value attributable to each resulting from a Title Defect (the “Title Defect ValueAmount”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth belowin good faith taking into account all relevant factors, as follows: (i) If if the Purchaser and the Company or Stockholder Representative (as applicable) agree on the Title Defect Amount, that amount shall be the Title Defect Amount; (ii) if the Title Defect is a lien upon any Assetan Encumbrance that is undisputed and liquidated in amount, then the Title Defect Value is Amount shall be the amount reasonably expected to be necessary to be paid to remove the lien Title Defect from the affected Asset.Major Property; (iiiii) If if the Title Defect asserted is that represents a discrepancy between (A) the Net Revenue Interest attributable to net revenue interest for any Well or unit or Well location is less than that Major Property and (B) the net revenue interest stated in on Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit CA for such Major Property, then the Title Defect Amount shall be the product of the Allocated Value shall take into account of such Major Property multiplied by a fraction, the relative change in numerator of which is the net revenue interest from Exhibit C decrease and the appropriate Allocated Value attributed to such Asset.denominator of which is the net revenue interest stated on Exhibit A, provided that if the Title Defect is not effective or does not affect a Major Property throughout its entire term, the Title Defect Amount determined under this Section 11.2(b)(iii) shall be reduced accordingly; (iiiiv) If if the Title Defect represents an obligationEncumbrance of a type not described in subsections (i), encumbrance(ii) or (iii) above, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value Amount shall be determined by taking into account the Allocated Value of the affected AssetMajor Property so affected, the portion of the Asset Company’s interest in the Major Property affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset.Major Property, the values placed upon the Title Defect by the Parties, and such other factors as are necessary to make a proper evaluation; (ivv) If notwithstanding anything to the contrary in this Section 11.2, the aggregate Title Defect Amounts attributable to the effects of all Title Defects upon any given Major Property shall not exceed the Allocated Value of such Major Property; (vi) if a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life reasonably susceptible of such Assetbeing cured, such fact shall be taken into account in determining the Title Defect Value.Amount determined under subsections (iii) or (iv) above shall not be greater than the lesser of (A) the reasonable cost and expense of curing such Title Defect or (B) the share of such curative work cost and expense which is allocated to such Major Property pursuant to subsection (vii) below; and (vvii) The the Title Defect Value Amount with respect to a Major Property shall be determined without duplication of any costs or losses Losses (A) included in another Title Defect Value Amount hereunder, (B) included in a casualty loss under Section 11.4, or (C) for which the Purchaser otherwise receives credit in the calculation of the Adjusted Total Merger Consideration. To the extent that the cost to cure any Title Defect will result in the curing of all or a part of one or more other Title Defects, such cost of cure shall be allocated for purposes of Section 11.2(b)(vi) among the Major Properties so affected on a fair and reasonable basis. (vic) Notwithstanding anything herein To the extent discovered prior to the contraryClaim Date, in no event shall a any Title Defect Value exceed Amounts determined in accordance with Section 11.2(b) shall be reduced by: any title increases found with respect to any Major Property, including any interest that entitles the Allocated Value of Company to receive more than the Wxxxx, units NRI set forth on Exhibit A or other Assets affected thereby. (vii) Such other factors as are reasonably necessary obligates the Company to make a proper evaluation.bear costs and expenses in an amount less than the WI set forth on Exhibit A.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify Seller the Sellers of the alleged Title Defect as promptly as possible, possible but no later than the expiration of the Examination Period of such alleged Title DefectPeriod. To be effective, such this notice (a “Title Defect Notice”) must (i) be in writing, ; (ii) be received by Seller by 5:00 p.m. Central Standard Time on the Sellers prior to the expiration date of the Examination Period and Period; (iii) describe the Title Defect in reasonable detail, to the extent then reasonably known by Buyer sufficient detail (including any alleged variance in the estimated Net Revenue Interest or Working Interest); (iv) identify the specific Asset or Assets affected by the Title Defect; and (v) include the value of such the Title Defect as determined by Buyer). Any matters that otherwise may otherwise constitute have constituted Title Defects, but of which Seller has that are not been notified by Buyer so described in a timely Title Defect Notice complying and delivered in accordance with the foregoingthis Section 4.04(a), shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon the After receipt of such an effective notice from BuyerTitle Defect Notice, Seller, at Seller’s the Sellers shall have the option, shall (i) subject but not the obligation, to Section 3.05(a), attempt to cure such the Title Defect at any time prior to the Closing and to postpone the Closing Date (with respect to all of the Assets or (ii) exclude the only those Assets affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as Title Defect) up to thirty (30) days beyond the date set forth on Exhibit C.in Section 12.01 to facilitate the cure; provided however that the foregoing shall not limit the Sellers’ ability to elect remedies for Title Defects as provided in Section 4.05(a). (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the a Title Defect notices Notice shall be determined in good faith based upon the criteria set forth below: (i) If the Buyer and Sellers agree on the Title Defect Value, that amount shall be the Title Defect Value. (ii) If the Title Defect is a lien upon an Encumbrance on any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien Encumbrance from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well or unit or Well location is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit C, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect asserted is that the NRI for a Federal Unit described on Exhibit F is less than the percentage or decimal interest set forth in Exhibit F as the Company’s NRI for such Federal Unit, then the Title Defect Value will be the product of (A) the relative change from the NRI as shown in Exhibit F and (B) the Allocated Value for such Federal Unit. (iv) If the Title Defect represents an obligation, encumbranceEncumbrance, burden or charge upon on the affected Asset (including any an instance where the NRI for a Well is less than the NRI for the applicable Federal Unit or an instance of an increase in Working Interest a WI for a Well or Xxxxx for which there is not a proportionate increase in Net Revenue InterestNRI) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset, the probability that a potential title failure will result in an actual title failure, the Title Defect Value placed upon the Title Defect by Buyer and the Sellers, and any such other reasonable factors as are necessary to make a proper evaluation. (ivv) If a Title Defect is not in effect effect, affects only certain depths, or does not adversely affect an Asset throughout the entire productive life of such Asset, such the consequences of that fact shall be taken into account in determining the Title Defect Value. (vvi) The Title Defect Value of a Title Defect shall be determined without duplication of any costs or losses included in another Title Defect Value hereunderValue. (vivii) Notwithstanding anything herein in this Agreement to the contrary, in no event shall a Title Defect Value exceed the proportional share of the Allocated Value of the Wxxxx, units or other Assets Federal Unit affected therebyby the Title Defect. (viiviii) Such other factors as are reasonably necessary To give the Sellers an opportunity to make a proper evaluationcommence reviewing possible Title Defects, Buyer shall give the Sellers, on or before 5:00 p.m. Mountain Time each Friday prior to the expiration of the Examination Period, notice of all Title Defects discovered by Buyer during the preceding week, which notice may be preliminary in nature and supplemented prior to the expiration of the Examination Period.

Notice of Title Defects. (a) If Buyer discovers any alleged Title Defect affecting any Asset, Buyer shall notify Seller Sellers of the alleged Title Defect as promptly as possible, but no later than the expiration of the Examination Period of such alleged Title DefectPeriod. To be effective, such this notice (a “Title Defect Notice”) must (i) be in writing, ; (ii) be received by Seller by 5:00 p.m. Central Standard Time on Sellers prior to the expiration date of the Examination Period and Period; (iii) describe the Title Defect in reasonable detailsufficient, to the extent then reasonably known by Buyer specific detail (including any alleged variance in the estimated value Net Revenue Interest or Working Interest); (iv) include copies of such documents necessary for Sellers to verify the existence of the alleged Title Defect, (v) identify the specific Asset or Assets affected by the Title Defect; and (vi) include the Title Defect Value as determined by Buyer). Any Except as set forth in Section 4.06, any matters that otherwise may otherwise constitute have constituted Title Defects, but of which Seller has that are not been notified by Buyer so described in a timely Title Defect Notice complying and delivered in accordance with the foregoingthis Section 4.04, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon the After receipt of such an effective notice from BuyerTitle Defect Notice, Seller, at Seller’s Sellers shall have the option, shall (i) subject but not the obligation, to Section 3.05(a), attempt to cure such the Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as set forth on Exhibit C.Closing. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the a Title Defect notices Notice shall be determined in good faith based upon the criteria set forth below: (i) If the Title Defect is a lien upon on any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well well, unit, well location or unit or Well location Lease is less than that stated in Exhibit C B or the Working Interest attributable to any Well or well, unit or Well well location is greater than that stated in Exhibit CB, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C B and the appropriate Allocated Value attributed to of such Asset. (iii) If . For purposes of this Agreement, the Title Defect represents an obligationterm “Allocated Value” means, encumbrance, burden or charge upon the affected Asset (including with respect to any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidatedAsset, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the allocated to that Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Assetunder Section 11.01. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify Seller Sellers as promptly as possible, but no later than the expiration of the Examination Period of such alleged Title Defect. To be effective, such notice must (i) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on Sellers prior to the expiration date of the Examination Period and Period, (iii) describe the Title Defect in reasonable detailsufficient, to the extent then reasonably known by Buyer specific detail (including any alleged variance in the estimated Net Revenue Interest), (iv) identify the specific Asset or Assets affected by such Title Defect, and (v) include the value of such Title Defect as determined by Buyer). Any matters that may otherwise constitute Title Defects, but of which Seller has Sellers have not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon the receipt of such effective notice from Buyer, Seller, at Seller’s option, shall (i) subject to Section 3.05(a), attempt to cure such Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as set forth on Exhibit C. (ca) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well well or unit or Well location is less than that stated in Exhibit C or the Working Interest attributable to any Well well or unit or Well location is greater than that stated in Exhibit C, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value of a Title Defect shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (viiv) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxxxxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify Seller as promptly as possibleprior to 5:00 p.m., but no later than local time in Houston, Texas, on April 22, 2010 (the expiration of the Examination Period “Defects Deadline”) of such alleged Title Defect. To be effective, such notice (a “Defects Notice”) must (i) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on prior to the expiration date of the Examination Period and Defects Deadline, (iii) describe the Title Defect in reasonable detailDefect, (iv) to the extent then reasonably known applicable, identify the specific Asset or Assets affected by Buyer such Title Defect, and (including v) include a good faith estimate of the estimated value Defect Value (defined below) of such Title Defect as determined by Buyer). Any matters that may otherwise constitute a Title DefectsDefect, but of which Seller has not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall Buyer, except to the extent any unasserted Title Defect would constitute Permitted Encumbrances. (bA) Upon a breach of the Seller’s special warranty of title contained in the Assignment, (B) a breach of any of Seller’s representations or warranties contained in this Agreement, or (C) a Retained Obligation (defined below). Except as otherwise provided herein, upon the receipt of such effective notice any Defects Notice from Buyer, Seller, at Seller’s Seller shall have the option, shall (i) subject but not the obligation, to Section 3.05(a), attempt to cure such Title Defect to Buyer’s reasonable satisfaction at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as set forth on Exhibit C.Closing. (cb) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices a Defects Notice shall be determined based upon the criteria set forth below: (i) If the if a Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset.; (ii) If the if a Title Defect asserted is that the Net Revenue Interest net mineral leasehold acres attributable to any Well or unit or Well location is the Subject Interests total less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit C12,750 net mineral leasehold acres, then the Title Defect Value thereof shall take into account be an amount equal to the relative change in product of $1,000 multiplied by the interest from Exhibit C difference between 12,750 net mineral leasehold acres and the appropriate Allocated Value attributed number of net mineral leasehold acres actually attributable to such Asset.the Subject Interests; (iii) If the if a Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset., and the Defect Values placed upon the Title Defect by Buyer and Seller; (iv) If if a Title Defect is not then currently in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value.; (v) The the Defect Value of a Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder.; (vi) Notwithstanding notwithstanding anything herein to the contrary, in no event shall the Defect Value of a Title Defect Value may not exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby.Asset; (vii) Such Buyer’s right to assert Title Defects hereunder shall not be diminished or otherwise adversely affected by any materiality qualification contained in any of Seller’s representations and warranties in Article V hereof; and (viii) such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify Seller of the alleged Title Defect as promptly as reasonably possible, including using its commercially reasonable efforts to provide weekly updates with respect to Title Defects, but no later than the expiration of the Examination Period of such alleged Title DefectPeriod. To be effective, such this notice (a “Title Defect Notice”) must (i) be in writing, ; (ii) be received by Seller by 5:00 p.m. Central Standard Time on prior to the expiration date of the Examination Period and Period; (iii) describe the Title Defect in reasonable detailsufficient, to the extent then reasonably known by Buyer specific detail (including any alleged variance in the estimated Net Revenue Interest or Working Interest); (iv) identify the specific Asset or Assets affected by the Title Defect; and (v) include the value of such the Title Defect as determined by Buyer). Any matters that otherwise may otherwise constitute have constituted Title Defects, but of which Seller has that are not been notified by Buyer so described in a timely Title Defect Notice complying and delivered in accordance with the foregoingthis Section 4.04(a), shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. The foregoing sentence shall not constitute a waiver of Buyer’s rights under (A) Section 16.04(b) or (B) the special warranty of title contained in the Assignment. (b) Upon the After receipt of such an effective notice from BuyerTitle Defect Notice, SellerSeller shall have the option, but not the obligation, to attempt to cure the Title Defect at Seller’s option, shall (i) subject to Section 3.05(a), attempt to cure such Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale sole cost and reduce the Purchase Price by the Allocated Value of such affected Asset as set forth on Exhibit C.expense. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the a Title Defect notices Notice shall be determined in good faith based upon the criteria set forth below: (i) If the Title Defect is a lien upon on any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well or unit or Well location is less than that stated in Exhibit C or B and there is a proportionate decrease in the Working Interest attributable to any such Well or unit or Well location is greater than that stated in Exhibit CB, then the Title Defect Value shall take into account be the relative change in the interest from Exhibit C and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount product of the Title Defect Value shall be determined by taking into account the Allocated Value of such Asset, multiplied by a fraction, the affected numerator of which is the difference between the Net Revenue Interest set forth in Exhibit B and the actual Net Revenue Interest, and the denominator of which is the Net Revenue Interest stated in Exhibit B. For purposes of this Agreement, the term “Allocated Value” means, with respect to any Asset, the portion of the amount allocated to that Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Assetunder Section 11.01. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify the Seller as promptly as possible, but no later than the expiration of the Examination Period of such alleged Title Defect. To be effective, such notice must (i) be in writing, (ii) be received by the Seller by 5:00 p.m. Central Standard Time on prior to the expiration date of the Examination Period and Period, (iii) describe the Title Defect in reasonable detailsufficient, to the extent then reasonably known by Buyer specific detail (including any alleged variance in the estimated Net Revenue Interest), (iv) identify the specific Asset or Assets affected by such Title Defect, and (v) include the value of such Title Defect as determined by Buyer). Any matters that may otherwise constitute Title Defects, but of which the Seller has not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon the receipt of such effective notice from Buyer, Seller, at Seller’s option, shall (i) subject to Section 3.05(a), the Seller may attempt to cure such Title Defect at any time prior to the Closing Closing, or (ii) exclude not take any remedial action with respect to the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as set forth on Exhibit C.alleged Title Defect. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset, including all associated costs. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well well, unit, or unit or Well PUD location is less than that stated in Exhibit C B or the Working Interest attributable to any Well well or unit or Well location is greater than that stated in Exhibit CB, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C B and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset, and the Title Defect Values placed upon the Title Defect by Buyer and the Seller. (iv) If a Title Defect is not in effect or does not adversely affect an Asset or PUD Location throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value of a Title Defect shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxxxxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Upon the discovery of a Title Defect affecting any Assetby Buyer, Buyer shall immediately notify Seller as promptly as possible, but no later than the expiration of the Examination Period in writing of such alleged Title Defect. To be effective, Any such notice must by Buyer shall include appropriate evidence and documentation to substantiate its position and shall be delivered to Seller. Within five (i5) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on the expiration date business days after Seller's receipt of the Examination Period title defects notice, Seller shall notify Buyer whether Seller agrees with Buyer's claimed Title Defects and/or the proposed Defect Values therefore ("Seller's Response"). The "Defect Value" shall mean the value by which any Property subject to this Agreement is impaired or reduced as a result of the existence of a Title Defect. If Seller does not agree with any claimed Title Defect and/or the proposed Defect Value therefore, then the parties shall enter into good faith negotiations and shall attempt to agree on such matters. If the notice of Title Defect is given and the Seller does not agree with the claimed Title Defect and/or the proposed Defect Value, the parties shall mutually agree upon an appropriate independent consultant in the state to resolve all points of disagreement relating to Title Defects and Defect Values. If within ten (iii10) describe days after the notice of the Title Defect has been provided by Buyer the parties have failed to mutually agree upon such appointment then each party shall retain such a consultant and those two consultants shall retain a third such consultant. The cost of any such consultants shall be borne 50% by Seller and 50% by Buyer. Each party shall present a written statement of its position on the Title Defect and/or Defect Value in reasonable detail, question to the extent then reasonably known by Buyer consultants within five (including 5) business days after the estimated value third consultant is selected, and the consultants shall make a determination of such Title Defect as determined by Buyer). Any matters that may otherwise constitute Title Defects, but all points of which Seller has not been notified by Buyer disagreement in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes terms and shall constitute Permitted Encumbrances. conditions of this Agreement within ten (b10) Upon the business days of receipt of such effective notice from Buyer, Seller, at Seller’s option, shall (i) subject to Section 3.05(a), attempt to cure such Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price position statements. The determination by the Allocated Value of such affected Asset as set forth on Exhibit C. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices consultants shall be determined based upon conclusive and binding on the criteria set forth below: (i) parties, and shall be enforceable against any party in any court of competent jurisdiction. If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well or unit or Well location is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit C, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value Defect(s) exceeds five percent (5%) of the Sale Price then either party may elect to terminate this transaction and such termination shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Assettreated consistent with Paragraph 14 hereof. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify provide Seller as promptly as possible, but notice of all Title Defects no later than 5:00 p.m. MST on the expiration of date which is seven (7) days prior to the Examination Period of such alleged Closing Date (the "Title DefectClaim Date"). To be effective, such notice must (ia) be in writing, (iib) be received by Seller by 5:00 p.m. Central Standard Time on or prior to the expiration date of the Examination Period and Title Claim Date, (iiic) describe the Title Defect in reasonable detaildetail (including any alleged variance in the Net Revenue Interest or Working Interest), to (d) identify the extent then specific Asset or Assets affected by such Title Defect, (e) include the Title Defect Value, as reasonably known determined by Buyer in good faith, and (including f) comply with the estimated value of such limitations and Title Defect as determined by Buyer)Value qualifications set forth in Section 4.14. Any matters identified by Buyer during the Examination Period that may otherwise constitute Title Defects, but of which Seller has not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Encumbrances and Assumed Obligations hereunder. Upon receipt of notices of Title Defects, the Parties shall meet and determine upon which of the Title Defects, Title Defect Values and methods of cure the Parties have reached agreement. Upon the receipt of such effective notice from Buyer, Seller, at Seller’s Seller shall have the option, shall but not the obligation, for a period ending ninety (i90) subject to Section 3.05(a), attempt days after the Closing to cure such defect. If Seller should not elect to cure a Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale Defect, and reduce no aspect of such defect is reasonably in dispute, the Purchase Price shall be adjusted for such defect by the Allocated Value amount of such affected Asset as set forth on Exhibit C.the Title Defect Value. (ca) The value attributable to each Title Defect (the “"Title Defect Value”") that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset.; (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well Well, PUD Location, PDNP, or unit or Well location Probable and/or Possible Locations is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit CD, then the Title Defect Value shall take into account be the relative change in absolute value of the interest from Exhibit C and number determined by the appropriate following formula: Title Defect Value = A x (1-[B/C]) A = Allocated Value attributed to such Asset.for the affected Asset B = Correct Net Revenue Interest for the affected Asset C = Net Revenue Interest for the affected Asset as set forth on Exhibit D. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset., and the Title Defect Values placed upon the Title Defect by Buyer and Seller; (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire post Effective Time productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value.; (v) The Title Defect Value of a Title Defect shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder.; (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the WxxxxWells, units PUD Locations, PDNP, Probable and/or Possible Locations, or other Assets affected thereby.; (vii) If the Title Defect Value of an Asset is equal to the Allocated Value of such Asset, the affected Asset shall be excluded from the purchase and sale contemplated by this Agreement, and the Purchase Price shall be adjusted accordingly; (viii) Notwithstanding the provisions of this Section 4.03 to the contrary, the Title Defect Value of any Title Defect comprising a required consent not obtained (other than consents customarily obtained after Closing) shall be determined subject to any accommodation implemented pursuant to Section 4.07; and (ix) Such other factors as are reasonably necessary to make a proper evaluation. (b) The term Title Defect shall not include: (i) Defects based solely on an assertion that Seller's files lack information, provided that any missing material information can be obtained by the reasonable efforts of Buyer; (ii) Defects in the early chain of title consisting of the failure to recite marital status in a document or omissions of successors of heirship or estate proceedings, unless Buyer provides a reasonable basis for the assertion that such failure or omission has resulted in a third party's actual and superior claim of title to the affected Asset; (iii) Defects arising out of lack of survey; (iv) Defects arising out of lack of corporate or other entity authorization unless Buyer provides a reasonable basis for the assertion that the action was not authorized and that such lack of authorization has resulted in a third party's actual and superior claim of title to the affected Asset; (v) Defects that are defensible by possession under applicable statutes of limitations for adverse possession or for prescription; provided that the mere passage of time in and of itself shall not establish any presumption of the applicability of the provisions of this Section 4.03(b)(v); (vi) Defects asserting a change in an applicable Working Interest or Net Revenue Interest based on a change in drilling and spacing units, tract allocation or other changes in pooling or unit participation occurring after the date of this Agreement; and (vii) Title requirements customarily considered as advisory or which can be waived as a matter of prudent business judgment.

Notice of Title Defects. (a) If Buyer discovers any Title On or before the Defect affecting any AssetNotice Date, Buyer shall notify Seller as promptly as possible, but no later than of any Title Defects pursuant to a Notice of Title Defects. Any Notice of Title Defects shall be in writing and shall contain the expiration of the Examination Period of such alleged Title Defect. To be effective, such notice must following: (i) be in writing, a description of the claimed Title Defect(s); (ii) be received the Title Defect Property affected by Seller by 5:00 p.m. Central Standard Time on the expiration date of the Examination Period and Title Defect(s); (iii) describe the Allocated Value of the Title Defect in reasonable detail, Property; (iv) supporting documents reasonably necessary for Seller (as well as Seller’s title attorney or examiner) to verify the extent then reasonably known by Buyer existence of any asserted Title Defect; and (including v) the estimated value of such Title Defect as determined by Buyer). Any matters Amount that may otherwise constitute Title Defects, but of which Seller has not been notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon the receipt of such effective notice from Buyer, Seller, at Seller’s option, shall (i) subject to Section 3.05(a), attempt to cure such Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price by reasonably believes the Allocated Value of such affected Asset as set forth on Exhibit C. (c) The value attributable to each Title Defect (Property is reduced by the “alleged Title Defect(s) and the computations and information upon which Buyer’s belief is based. To give Seller an opportunity to commence reviewing and curing Title Defects, Buyer agrees to give Seller, on or prior to the end of each calendar week prior to the Defect Value”) that is asserted Notice Date, written notice of all Title Defects discovered by Buyer during the preceding calendar week that Buyer intends to assert as Title Defects hereunder, which notice may be sent by electronic mail, be preliminary in nature, and supplemented on or prior to the Title Defect notices Notice Date; provided that, Buyer’s failure to deliver any such notice shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well not waive or unit or Well location is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit C, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life Buyer’s right to notify Seller of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Defects pursuant to a Notice of Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein Defects prior to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected therebyNotice Date. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any AssetAsset (each, a “Title Defect Property”), Buyer shall notify Seller Sellers as promptly as possible, but no later than the expiration of the Examination Period Period, of such alleged Title Defect. To be effective, such notice must (i) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on Sellers prior to the expiration date of the Examination Period and Period, (iii) describe the Title Defect in reasonable detailsufficient, to the extent then reasonably known by Buyer specific detail (including any alleged variance in the estimated Net Revenue Interest), (iv) identify the specific Asset or Assets affected by such Title Defect, and (v) include the value of such Title Defect as determined by Buyer). Any Except for Buyer’s rights under the special warranty of title contained in the Assignment, any matters that may otherwise constitute Title Defects, but of which Seller has Sellers have not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted EncumbrancesEncumbrances and shall not constitute a Title Defect. (b) Upon the receipt of such effective notice from Buyer, SellerSellers and Buyer shall attempt to mutually agree on a resolution with respect to any alleged Title Defect. Sellers shall have the right, but not the obligation, to attempt, at Seller’s optiontheir sole cost, to cure or remove on or before sixty (60) days after the expiration of the Examination Period (the “Cure Period”) any Title Defects for which Sellers have received a Title Defect notice from Buyer prior to the expiration of the Examination Period. No reduction shall be made to the Closing Payment with respect to any Title Defect properly asserted prior to the expiration of the Examination Period (ithe “Asserted Title Defects”) subject and for which Sellers have provided notice to Section 3.05(a), Buyer prior to or on the Closing Date that Sellers intend to attempt to cure such Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as set forth on Exhibit C. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices during the Cure Period or for which Sellers have provided notice to Buyer prior to or on the Closing Date that Sellers dispute the existence, in whole or in part, which notice shall be determined based upon include a description of the criteria set forth below: matters in dispute (i) If the any Asserted Title Defect is for which Sellers properly dispute the existence, in whole or in part, a lien upon any Asset“Disputed Defect”). Subject to Section 3.05, the Title Defect Value is resulting from the amount reasonably expected Asserted Title Defects asserted by Buyer and not cured by Sellers prior to be necessary to Closing shall be paid to remove a mutually agreed escrow agent (the lien from “Escrow Agent”) at Closing pursuant to a form of escrow agreement to be mutually agreed to prior to Closing (the affected Asset. “Escrow Agreement”), unless the Parties agree otherwise; provided, however, (iii) If the if Sellers elect to cure an Asserted Title Defect asserted is that the Net Revenue Interest attributable to any Well or unit or Well location is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit CDefect, then the Title Defect Value resulting from such Asserted Title Defect shall take into account be released to Sellers upon cure if such Asserted Title Defect is cured by the relative change expiration of the Cure Period (the “Remedy Deadline”), and if not cured by then, such Title Defect Value shall be released to Buyer or Sellers, as applicable, pursuant to Section 3.04(c), at such time, or if the relevant Asserted Title Defect becomes subject to resolution pursuant to Article XVI (a “Disputed Title Matter”), then such Title Defect Value shall be treated as provided in the interest from Exhibit C following sub-part (ii), and the appropriate Allocated Value attributed to such Asset. (iiiii) If the if an Asserted Title Defect represents an obligationis a Disputed Defect or Disputed Title Matter, encumbrance, burden or charge upon such Asserted Title Defect shall be finally and exclusively resolved in accordance with the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount provisions of Article XVI and release of the Title Defect Value from escrow for such Asserted Title Defect shall be determined by taking into account resolved in accordance therewith. If, prior to the Allocated Value expiration of the affected AssetRemedy Deadline, Sellers and Buyer cannot agree on (A) the portion of the Asset affected by the proper and adequate cure for any such Title Defect, (B) the legal effect of Title Defect Value or (C) whether the Asserted Title Defect constitutes a Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset. (ivthen such dispute(s) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account finally and exclusively resolved in determining accordance with the Title Defect Valueprovisions of Article XVI. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers shall give Seller written notice of any Oil and Gas Property that Buyer alleges in good faith to have a Title Defect affecting any Asset, Buyer shall notify Seller as promptly as possible, but (a “Title Defect Notice”) no later than January 18, 2011, at 5:00 p.m., Central Daylight Time (the expiration of “Title Defect Notice Date”). Such notice shall be in writing and shall include the Examination Period of such alleged Title Defect. To be effective, such notice must following information: (i) be in writinga description of the Title Defect, (ii) be received by Seller by 5:00 p.m. Central Standard Time on the expiration date of reasonable basis for the Examination Period and Title Defect, (iii) describe the Allocated Value of the affected Oil and Gas Property, and (iv) the Title Defect Amount and the computations upon which Buyer’s belief is based. Upon the written request of Seller, Buyer shall promptly make available or deliver to Seller (by electronic mail or otherwise) any reasonable documentation supporting the basis for any Title Defect set forth in reasonable detaila Title Defect Notice. In determining which portions of an Oil and Gas Property has a Title Defect, it is the intent of the parties to include, to the extent then reasonably known possible, only that portion of the affected Oil and Gas Property (whether a Well, unit or leasehold interest, as applicable) materially and adversely affected by Buyer (including the estimated value defect or basis for such Oil and Gas Property being treated as having a Title Defect. Subject only to the special warranty of such Title Defect as determined by Buyertitle set forth in the conveyances and the limited title warranty set forth in Section 3.16(a). Any , any matters that may otherwise constitute Title Defects, but of which Seller has not been specifically notified by Buyer in accordance with the foregoingforegoing by the Title Defect Notice Date, shall be deemed to have been be waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) purposes. Upon the receipt of such an effective notice Title Defect Notice from Buyer, Seller, at Seller’s Seller shall have the option, shall (i) subject in addition to the remedies set forth in Section 3.05(a)6.2, but not the obligation, to attempt to cure such Title Defect at Seller’s sole cost and expense at any time prior to the Closing or (ii) exclude the Closing. The Oil and Gas Property affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as set forth on Exhibit C. (c) The value attributable to each any uncured Title Defect (the at Closing shall be a “Title Defect ValueProperty.”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well or unit or Well location is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit C, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. In connection with the Parent’s due diligence review conducted prior to the Effective Time, the Parent may give the Company notice (aa "Defect Notice") If Buyer discovers of any Title Defect affecting any Asset, Buyer shall notify Seller (as promptly as possible, but no later than the expiration of the Examination Period of such alleged Title Defect. To be effective, such notice must (i) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on the expiration date of the Examination Period and (iii) describe the Title Defect in reasonable detail, to the extent then reasonably known by Buyer (including the estimated value of such Title Defect as determined by Buyerdefined below). Any matters that may otherwise constitute Title Defects, but of which Seller has not been notified by Buyer in accordance Such Defect Notice shall comply with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon the receipt of such effective notice from Buyer, Seller, at Seller’s option, shall (i) subject to Section 3.05(a), attempt to cure such Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as set forth on Exhibit C. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth belowfollowing: (i) If Such Defect Notice must be received by the Title Defect is a lien upon any Asset, Company on or before the Title Defect Value is Effective Time (the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset"Notice Deadline"). (ii) If Such Defect Notice shall be in writing and shall include the following: (A) a description of each Company Oil and Gas Property that is affected by the Title Defect (a "Defective Interest"); (B) the basis for treating such property as a Defective Interest and copies of supporting documents reasonably necessary for the Company to verify the existence of such asserted is that Title Defect; (C) the Net Revenue Allocated Value (as defined below) of the affected property; and (D) the Parent’s good faith estimate of the amount by which the Allocated Value of a Defective Interest attributable to any Well or unit or Well location is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit C, then has been reduced by the Title Defect Value shall take into account (the relative change in the interest from Exhibit C and the appropriate Allocated Value attributed "Defect Value") (calculated pursuant to such AssetSection (a)(iii)). (iii) If In determining which portion of a property is a Defective Interest, it is the intent of the Parties to include only that portion of the property materially and adversely affected by the Title Defect. The Defect represents an obligation, encumbrance, burden or charge upon Value may not exceed the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount Allocated Value of the Title Defect Value property and shall be determined by the parties in good faith taking into account all relevant factors, including without limitation, the following: (A) the Allocated Value of the affected Assetproperty; (B) as to the well, lease and unit interests, the portion potential for or actual reduction in the NRI of the Asset affected Defective Interest, or the potential for or actual increase in the WI to the extent such increase is not accompanied by the Title Defect, a corresponding increase in NRI; (C) the legal effect of the Title Defect, the potential discounted economic effect of ; (D) if the Title Defect over is a lien or encumbrance on the life property, the cost of the affected Asset.removing such lien or encumbrance; (ivE) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining if the Title Defect Value.represents only a possibility of title failure, the probability that such failure will occur; and (vF) The whether the Company has received proceeds of production from the Defective Interest, consistent with the NRI set forth in the Company Reserve Report, for the last three years without interruption or challenge based on the Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunderDefect. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer Purchaser discovers any Title Defect affecting any Asset, Buyer Purchaser shall notify Seller as promptly as possible, but no later than the expiration of the Examination Period possible of such alleged Title Defect. To be effectiveeffective for purposes of Closing, determination of the Purchase Price or exclusion from the Closing, such notice must (i) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on prior to the expiration date of the Closing Examination Period and Period, (iii) describe the Title Defect in reasonable detailsufficient, to the extent then reasonably known by Buyer specific detail (including any alleged variance in the estimated Net Revenue Interest), (iv) identify the specific Asset or Assets affected by such Title Defect, and (v) include the value of such Title Defect as determined by Buyer)Purchaser. Any matters that may otherwise constitute Title Defects, but of which Seller has not been specifically notified by Buyer Purchaser in accordance with the foregoingforegoing during the Closing Examination Period, shall be deemed covered by Seller’s warranty of title to have been waived by Buyer for all purposes and shall constitute Permitted EncumbrancesPurchaser. (b) Upon the receipt of such effective notice from Buyer, Seller, at Seller’s option, shall (i) subject to Section 3.05(a), attempt to cure such Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as set forth on Exhibit C. (ca) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer Purchaser in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well well or unit or Well location is less than that stated in Exhibit C B or the Working Interest attributable to any Well well or unit or Well location is greater than that stated in Exhibit CB, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C B and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value of a Title Defect shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (viiv) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxxwxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify Seller as promptly as possible, but no later than prior to the expiration of the Examination Period of such alleged Title Defect. To be effective, such notice must (i) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on prior to the expiration date of the Examination Period and Period, (iii) describe the Title Defect in reasonable detailsufficient, to the extent then reasonably known by Buyer specific detail (including any alleged variance in the estimated Net Revenue Interest), (iv) identify the specific Asset or Assets affected by such Title Defect, and (v) include the value of such Title Defect as determined by Buyer). Any matters that may otherwise constitute Title Defects, but of which Seller has not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and under this Agreement, however, the failure to notify Seller of an undiscovered Title Defect shall constitute Permitted Encumbrancesnot act as a waiver of any breach of the Special Warranty included in the Assignment to be delivered at Closing. (b) Upon the receipt of such effective notice from Buyer, Seller, at Seller’s Seller shall have the option, shall but not the obligation, to (i) subject to Section 3.05(a), attempt to cure such Title Defect at any time prior to the Closing or Closing, (ii) exclude the affected Asset from the sale and reduce the Purchase Price by the Allocated Value allocated value of such affected Asset as set forth on Exhibit C.Asset, or if acceptable to Buyer (iii) not take any action with respect to the alleged Title Defect and indemnify Buyer pursuant to Section 12.04 against all costs which Buyer may incur in connection with same. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below:; (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well Lease, well or unit or Well location is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit CExhibits B and X-x, then the Title Defect Value shall take into account is the relative change product of the [***], multiplied by a fraction, the numerator of which is the difference between the [***] applicable thereto set forth in the interest from Exhibit C [***] and the appropriate Allocated Value attributed to such Asset[***], and the denominator of which is the applicable [***] stated in [***]. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset, and the Title Defect Values placed upon the Title Defect by Buyer and Seller. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value of a Title Defect shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxxxxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer Xxxxx discovers any Title Defect affecting any AssetAsset (each, a “Title Defect Property”), Buyer shall notify Seller Sellers as promptly as possible, but no later than the expiration of the Examination Period Period, of such alleged Title Defect. To be effective, such notice must (i) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on Sellers prior to the expiration date of the Examination Period and Period, (iii) describe the Title Defect in reasonable detailsufficient, to the extent then reasonably known by Buyer specific detail (including any alleged variance in the estimated Net Revenue Interest), (iv) identify the specific Asset or Assets affected by such Title Defect, and (v) include the value of such Title Defect as determined by Buyer). Any Except for Xxxxx’s rights under the special warranty of title contained in the Assignment, any matters that may otherwise constitute Title Defects, but of which Seller has Sellers have not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted EncumbrancesEncumbrances and shall not constitute a Title Defect. (b) Upon the receipt of such effective notice from BuyerXxxxx, SellerXxxxxxx and Xxxxx shall attempt to mutually agree on a resolution with respect to any alleged Title Defect. Sellers shall have the right, but not the obligation, to attempt, at Seller’s optiontheir sole cost, to cure or remove on or before sixty (60) days after the expiration of the Examination Period (the “Cure Period”) any Title Defects for which Sellers have received a Title Defect notice from Buyer prior to the expiration of the Examination Period. No reduction shall be made to the Closing Payment with respect to any Title Defect properly asserted prior to the expiration of the Examination Period (the “Asserted Title Defects”) and for which Sellers have provided notice to Buyer prior to or on the Closing Date that Sellers intend to attempt to cure the Title Defect during the Cure Period or for which Sellers have provided notice to Buyer prior to or on the Closing Date that Sellers dispute the existence, in whole or in part, which notice shall include a description of the matters in dispute (any Asserted Title Defect for which Sellers properly dispute the existence, in whole or in part, a “Disputed Defect”). Subject to Section 3.05, the Title Defect Value resulting from the Asserted Title Defects asserted by Buyer and not cured by Sellers prior to Closing shall be paid to a mutually agreed escrow agent (the “Escrow Agent”) at Closing pursuant to a form of escrow agreement to be mutually agreed to prior to Closing (the “Escrow Agreement”), unless the Parties agree otherwise; provided, however, (i) if Sellers elect to cure an Asserted Title Defect, the Title Defect Value resulting from such Asserted Title Defect shall be released to Sellers upon cure if such Asserted Title Defect is cured by the expiration of the Cure Period (the “Remedy Deadline”), and if not cured by then, such Title Defect Value shall be released to Buyer or Sellers, as applicable, pursuant to Section 3.04(c), at such time, or if the relevant Asserted Title Defect becomes subject to resolution pursuant to Article XVI (a “Disputed Title Matter”), then such Title Defect Value shall be treated as provided in the following sub-part (ii), and (ii) if an Asserted Title Defect is a Disputed Defect or Disputed Title Matter, such Asserted Title Defect shall be finally and exclusively resolved in accordance with the provisions of Article XVI and release of the Title Defect Value from escrow for such Asserted Title Defect shall be resolved in accordance therewith. If, prior to the expiration of the Remedy Deadline, Sellers and Buyer cannot agree on (A) the proper and adequate cure for any such Title Defect, (B) the Title Defect Value or (C) whether the Asserted Title Defect constitutes a Title Defect, then such dispute(s) shall be finally and exclusively resolved in accordance with the provisions of Article XVI. (c) In the event that any Title Defect (other than a Disputed Title Matter) is not waived by Buyer or, subject to Section 3.05(a3.04 (b), attempt cured prior to cure the Remedy Deadline, then unless otherwise mutually agreed in writing by the Parties, subject to Section 3.05, Buyer shall, at its sole election, elect to (i) retain the Title Defect Property and make a downward adjustment to the Unadjusted Purchase Price by an amount equal to the Title Defect Value of such Title Defect at any time prior to the Closing or (ii) exclude the entirety of the Title Defect Property that is adversely affected Asset from by such Title Defect and reconvey such Title Defect Property to Sellers, in which event, the sale and reduce the Unadjusted Purchase Price shall be adjusted downward, by an amount equal to the Allocated Value of such affected Asset Title Defect Property, and such Title Defect Property shall constitute an Excluded Asset. Upon Buyer making an election pursuant to this Section 3.04(c), the Parties shall complete any reconveyancing of the relevant Title Defect Property, if necessary, to effect such election. Any downward adjustment to the Unadjusted Purchase Price pursuant to this Section 3.04(c), together with any other adjustments as set forth on Exhibit C.may be required pursuant to Section 3.04(b), if applicable, shall be made (and accounted for) in connection with the preparation of the Final Accounting Statement, except for Title Defects that Sellers do not dispute or attempt to cure, which Title Defects will be accounted for at Closing. (cd) The Unless Sellers and Buyer agree otherwise, the value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any AssetAsset which is undisputed and liquidated in amount, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Acres under a Lease are less than that stated in Exhibit A or Exhibit D, the Net Revenue Interest attributable to any Lease, Well or unit or Well location is less than that stated in Exhibit C A, Exhibit B or Exhibit D or the Working Interest attributable to any Lease, Well or unit or Well location is greater than that stated in Exhibit CA, Exhibit B or Exhibit D for which there is not a proportionate increase in Net Revenue Interest, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C A, Exhibit B or Exhibit D and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest), other than as described in Sections 3.04(d)(i) and (ii) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset, and the Title Defect Value placed upon the Title Defect by Xxxxx and Sellers. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value of a Title Defect shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the WxxxxXxxxx, units or other Assets affected thereby. (vii) Such The Title Defect Value of a Title Defect shall be determined considering such other factors as are reasonably necessary normally considered in transactions involving the sale of properties and assets similar to make a proper evaluationthe Assets.

Notice of Title Defects. (a) If Buyer discovers any alleged Title Defect affecting any Asset, Buyer shall notify Seller of the alleged Title Defect as promptly as possible, but no later than the {1914556;9} - 16 - expiration of the Examination Period of such alleged Title DefectPeriod. To be effective, such this notice (a “Title Defect Notice”) must (i) be in writing, ; (ii) be received by Seller by 5:00 p.m. Central Standard Time on prior to the expiration date of the Examination Period and Period; (iii) describe the Title Defect in reasonable detailsufficient, to the extent then reasonably known by Buyer specific detail (including any alleged variance in the estimated value Net Revenue Interest or Working Interest); (iv) include copies of such documents necessary for Seller to verify the existence of the alleged Title Defect, (v) identify the specific Asset or Assets affected by the Title Defect; and (vi) include the Title Defect Value as determined by Buyer). Any Except as set forth in Section 4.06, any matters that otherwise may otherwise constitute have constituted Title Defects, but of which Seller has that are not been notified by Buyer so described in a timely Title Defect Notice complying and delivered in accordance with the foregoingthis Section 4.04(a), shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon the After receipt of such an effective notice from BuyerTitle Defect Notice, Seller, at Seller’s Seller shall have the option, shall (i) subject but not the obligation, to Section 3.05(a), attempt to cure such the Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as set forth on Exhibit C.Closing. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the a Title Defect notices Notice shall be determined in good faith based upon the criteria set forth below: (i) If the Title Defect is a lien upon on any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well well, unit, well location or unit or Well location Lease is less than that stated in Exhibit C B or the Working Interest attributable to any Well or well, unit or Well well location is greater than that stated in Exhibit CB, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C B and the appropriate Allocated Value attributed to of such Asset. (iii) If . For purposes of this Agreement, the Title Defect represents an obligationterm “Allocated Value” means, encumbrance, burden or charge upon the affected Asset (including with respect to any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidatedAsset, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the allocated to that Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Assetunder Section 11.01. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify Seller as promptly as possible, but Sellers no later than the expiration of the Examination Period of such alleged Title Defect. To be effective, such notice must (i) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on Sellers prior to the expiration date of the Examination Period and Period, (iii) describe the Title Defect in reasonable detailsufficient, to the extent then reasonably known by Buyer specific detail (including any alleged variance in the estimated Net Revenue Interest), (iv) identify the specific Asset or Assets affected by such Title Defect, and (v) include the value of such Title Defect as determined by Buyer). Any matters that may otherwise constitute Title Defects, but of which Seller has Sellers have not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon the receipt of such effective notice from Buyer, SellerSellers and Buyer shall attempt to mutually agree on a resolution with respect to any alleged Title Defect. Sellers shall have the right, but not the obligation at Seller’s optiontheir sole cost and expense, shall (i) subject to Section 3.05(a), attempt to cure any such Title Defect at any time prior to the Closing or Closing. In the event that Sellers do not elect to cure any alleged Title Defect and Buyer and Sellers are not able to mutually agree upon the resolution of such alleged Title Defect within two (ii2) exclude Business Days after the last day of the Examination Period (which agreement may include the removal of the affected Asset from the sale and reduce this Agreement with a corresponding downward adjustment to the Purchase Price by in the amount of the Allocated Value of associated with such affected Asset as Asset), the alleged Title Defect shall be subject to the Purchase Price adjustment provisions set forth on Exhibit C.in Section 3.05. (c) The Unless Sellers and Buyer agree otherwise, the value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well or unit or Well location Subject Interest is less than that stated in Exhibit C or D, then the Title Defect Value shall be the product of the Allocated Value of the affected Subject Interest multiplied by a fraction, the numerator of which is One (1) minus the actual Net Revenue Interest held by Sellers in such Subject Interest and the denominator of which is the Net Revenue Interest stated in Exhibit D for such Subject Interest. (iii) If the Title Defect asserted is that the Working Interest attributable to any Well or unit or Well location Subject Interest is greater than that stated in Exhibit CD for which there is not a proportionate increase in Net Revenue Interest, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C D and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer shall provide Seller notice of all Title Defects no later than 5:00 p.m. CDT on September 7, 2007; provided, however, if during the Examination Period, Buyer discovers any Title Defect affecting any Asset, Buyer shall promptly notify Seller as promptly as possible, but no later than the expiration of the Examination Period of such alleged Title Defect. To be effective, such notice must (ia) be in writing, (iib) be received by Seller by 5:00 p.m. Central Standard Time on prior to the expiration date of the Examination Period and Period, (iiic) describe the Title Defect in reasonable detailsufficient, to specific detail (including any alleged variance in the extent then Net Revenue Interest or Working Interest), (d) identify the specific Asset or Assets affected by such Title Defect, (e) include the Title Defect Value, as reasonably known determined by Buyer in good faith, and (including f) comply with the estimated value of such limitations and Title Defect as determined by Buyer)Value qualifications set forth in Section 4.15. Any matters identified by Buyer during the Examination Period that may otherwise constitute Title Defects, but of which Seller has not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Encumbrances and Assumed Obligations hereunder. Upon receipt of notices of Title Defects, the Parties shall meet and determine upon which of the Title Defects, Title Defect Values and methods of cure the Parties have reached agreement. Upon the receipt of such effective notice from Buyer, Seller, at Seller’s Seller shall have the option, shall but not the obligation, for a period ending ninety (i90) subject to Section 3.05(a), attempt days after the Closing to cure such defect. If Seller should not elect to cure a Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale Defect, and reduce no aspect of such defect is reasonably in dispute, the Purchase Price shall be adjusted for such defect by the Allocated Value amount of such affected Asset as set forth on Exhibit C.the Title Defect Value. (ca) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset.; (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well Well, PUD Location, PDNP or unit or Well location Probable and/or Possible Locations is less than that stated in Exhibit C D-1 or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit CD-2 (as applicable), then the Title Defect Value shall take into account be the relative change in absolute value of the interest from Exhibit C and number determined by the appropriate following formula: Title Defect Value = A x (1-[B/C]) A = Allocated Value attributed to such Assetfor the affected Asset B = Correct Net Revenue Interest for the affected Asset C = Net Revenue Interest for the affected Asset as set forth on Exhibit D-1 or Exhibit D-2 (as applicable). (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset., and the Title Defect Values placed upon the Title Defect by Buyer and Seller; (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value.; (v) The Title Defect Value of a Title Defect shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder.; (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units PUD Locations, PDNP, Probable and/or Possible Locations, Undeveloped Acreage or other Assets affected thereby.; (vii) If the Title Defect Value of an Asset is equal to the Allocated Value of such Asset, the affected Asset shall be excluded from the purchase and sale contemplated by this Agreement, and the Purchase Price shall be adjusted accordingly; (viii) Notwithstanding the provisions of this Section 4.04 to the contrary, the Title Defect Value of any Title Defect comprising a required consent not obtained (other than consents customarily obtained after Closing) shall be determined subject to any accommodation implemented pursuant to Section 4.08; and (ix) Such other factors as are reasonably necessary to make a proper evaluation. (b) The term Title Defect shall not include: (i) Defects based solely on an assertion that Seller’s files lack information, provided that any missing material information can be obtained by the reasonable efforts of Buyer; (ii) Defects in the early chain of title consisting of the failure to recite marital status in a document or omissions of successors of heirship or estate proceedings, unless Buyer provides a reasonable basis for the assertion that such failure or omission has resulted in a third party’s actual and superior claim of title to the affected Asset; (iii) Defects arising out of lack of survey; (iv) Defects arising out of lack of corporate or other entity authorization unless Buyer provides a reasonable basis for the assertion that the action was not authorized and that such lack of authorization has resulted in a third party’s actual and superior claim of title to the affected Asset; (v) Defects that are defensible by possession under applicable statutes of limitations for adverse possession or for prescription; provided that the mere passage of time in and of itself shall not establish any presumption of the applicability of the provisions of this Section 4.04(b)(v); (vi) Defects asserting a change in an applicable Working Interest or Net Revenue Interest based on a change in drilling and spacing units, tract allocation or other changes in pooling or unit participation occurring after the date of this Agreement; and (vii) Title requirements customarily considered as advisory or which can be waived as a matter of prudent business judgment.

Notice of Title Defects. (a) If Buyer discovers any alleged Title Defect affecting any Asset, Buyer shall notify Seller of the alleged Title Defect as promptly as possible, but no later than the expiration of the Examination Period of such alleged Title DefectPeriod. To be effective, such this notice (a “Title Defect Notice”) must (i) be in writing, ; (ii) be received by Seller by 5:00 p.m. Central Standard Time on prior to the expiration date of the Examination Period and Period; (iii) describe the Title Defect in reasonable detailsufficient, to the extent then reasonably known by Buyer specific detail (including any alleged variance in the estimated value Net Revenue Interest or Working Interest); (iv) include copies of such documents necessary for Seller to verify the existence of the alleged Title Defect, (v) identify the specific Asset or Assets affected by the Title Defect; and (vi) include the Title Defect Value as determined by Buyer). Any matters that otherwise may otherwise constitute have constituted Title Defects, but of which Seller has that are not been notified by Buyer so described in a timely Title Defect Notice complying and delivered in accordance with the foregoingthis Section 4.04(a), shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon the After receipt of such an effective notice from BuyerTitle Defect Notice, Seller, at Seller’s Seller shall have the option, shall (i) subject but not the obligation, to Section 3.05(a), attempt to cure such the Title Defect at any time prior to the Closing or and to postpone the Closing Date up to thirty (ii30) exclude days beyond the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as date set forth on Exhibit C.in Section 12.01 to facilitate the cure. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the a Title Defect notices Notice shall be determined in good faith based upon the criteria set forth below: (i) If the Title Defect is a lien upon on any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well well, unit, well location or unit or Well location Lease is less than that stated in Exhibit C B or the Working Interest attributable to any Well or well, unit or Well well location is greater than that stated in Exhibit CB, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C B and the appropriate Allocated Value attributed to of such Asset. (iii) If . For purposes of this Agreement, the Title Defect represents an obligationterm “Allocated Value” means, encumbrance, burden or charge upon the affected Asset (including with respect to any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidatedAsset, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the allocated to that Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Assetunder Section 11.01. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer Purchaser discovers any Title Defect affecting any Asset, Buyer Purchaser shall notify Seller as promptly as possible, possible but no later than the expiration of the Examination Period of such alleged Title Defect. To be effective, such notice must (i) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on prior to the expiration date of the Examination Period and Period, (iii) describe the Title Defect in reasonable detailsufficient, to the extent then reasonably known by Buyer specific detail (including any alleged variance in the estimated Net Revenue Interest), (iv) identify the specific Asset or Assets affected by such Title Defect, and (v) include the value of such Title Defect as determined by Buyer)Purchaser. Any matters that may otherwise constitute Title Defects, but of which Seller has not been specifically notified by Buyer Purchaser in accordance with the foregoing, shall be deemed to have been waived by Buyer Purchaser for all purposes and shall constitute Permitted Encumbrances. (b) Upon the receipt of such effective notice from BuyerPurchaser, SellerSeller and Purchaser shall attempt to mutually agree on a resolution including, at Seller’s option, shall but not limited to (i) subject to Section 3.05(a), attempt to cure such Title Defect at any time prior to the Closing Closing, or (ii) exclude include the affected Asset from in the sale and reduce the Purchase Price by mutually agreed upon value of the Allocated Value Title Defect. Alternatively, Seller shall have the right, in its discretion, to elect to (x) have such Title Defect determined in accordance with Section 3.05(c), or (y) with the prior written consent of such affected Asset as set forth on Exhibit C.the Purchaser (not to be unreasonably withheld) not take any action with respect to the alleged Title Defect and indemnify, defend and hold harmless Purchaser pursuant to Section 14.02 from and against all Damages which Purchaser may incur in connection with same. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer Purchaser in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien Lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien Lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well well or unit or Well location is less than that stated in Exhibit C B or the Working Interest attributable to any Well well or unit or Well location is greater than that stated in Exhibit CB, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C B and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer Purchaser is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset, and the Title Defect Values placed upon the Title Defect by Purchaser and Seller. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value of a Title Defect shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxxxxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify Seller as promptly as possible, possible but no later than the expiration of the Examination Period of such alleged Title Defect. To be effective, such notice must (i) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on prior to the expiration date of the Examination Period and Period, (iii) describe the Title Defect in reasonable detailsufficient, specific detail (including any alleged variance in the Net Revenue Interest) to the extent then reasonably known known, (iv) identify the specific Asset or Assets affected by Buyer such Title Defect, and (including v) include the estimated value of such Title Defect as determined by Buyer). Any matters that may otherwise constitute Title Defects, but of which Seller has not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrancespurposes, except under the Assignment. (b) Upon the receipt of such effective notice from Buyer, Sellersubject to Section 3.05 Seller and Buyer shall attempt to mutually agree on a resolution including, at Seller’s option, shall but not limited to (i) subject to Section 3.05(a), attempt to cure such Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price by the Allocated Value mutually agreed allocated value of such affected Asset as set forth on Exhibit C.Asset. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well well or unit or Well location is less than that stated in Exhibit C or the Working Interest attributable to any Well well or unit or Well location is greater than that stated in Exhibit C, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) of a type not described in Subsections (i) and (ii) of Section 3.04(c) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the following factors: the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset, the Title Defect Values placed upon the Title Defect by Buyer and Seller and such other reasonable factors as are necessary to make a proper evaluation. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value of a Title Defect shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxxxxxxx, units or other Assets affected thereby. (vii) If Buyer and Seller agree on the Title Defect Value, that amount shall be the Title Defect Value. (viii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify Seller as promptly as possible, possible but no later than the expiration of the Post Closing Examination Period of such alleged Title Defect. To be effective, such notice must (i) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on prior to the expiration date of the Post Closing Examination Period and Period, (iii) describe the Title Defect in reasonable detailsufficient, specific detail (including, without limitation, any alleged variance in the Net Revenue Interest or Working Interest), (iv) identify the specific Asset or Assets affected by such Title Defect (which shall include the entire Unit Acreage associated with the Well if the Title Defect affects a Well and the entire interest in lands covered by any Lease that is subject to the extent then reasonably known by Buyer a Title Defect), and (including v) include the estimated value of such Title Defect as determined by Buyer). Any matters that may would otherwise constitute Title Defects, but of which Seller has not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon the receipt of such effective notice from Buyer, Seller, at Seller’s option, Seller and Buyer shall (i) subject to Section 3.05(a), attempt to agree on a resolution regarding the existence of the asserted Title Defect, the actions appropriate to cure such the Title Defect, and the economic effect of the Title Defect at any time prior to on the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as set forth on Exhibit C.related Assets. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well or unit or Well location is less than that stated in Exhibit C B or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit CB, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C B and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including including, without limitation, any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset, and the Title Defect Values placed upon the Title Defect by Buyer and Seller. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value of a Title Defect shall be determined without duplication of any costs or losses Losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of all the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify Seller as promptly as possibleSellers prior to 5:00 p.m., but no later than local time on or before August 31, 2012 (the expiration of the Examination Period “Defects Deadline”) of such alleged Title Defect. To be effective, such notice (a “Defects Notice”) must (i) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on Sellers prior to the expiration date of the Examination Period and Defects Deadline, (iii) describe the Title Defect in reasonable detailDefect, (iv) to the extent then reasonably known applicable, identify the specific Asset or Assets affected by Buyer such Title Defect, and (including v) include a good faith estimate of the estimated value Defect Value (defined below) of such Title Defect as determined by Buyer). Any matters that may otherwise constitute a Title DefectsDefect, but of which Seller has Sellers have not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall Buyer, except to the extent any unasserted Title Defect would constitute Permitted Encumbrances(A) a breach of the Sellers’ special warranty of title contained in the Assignment, (B) a breach of any of Sellers’ representations or warranties contained in this Agreement, or (C) a Retained Obligation (defined below). (b) Upon the receipt of such effective notice from Buyer, Seller, at Seller’s option, shall (i) subject to Section 3.05(a), attempt to cure such Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as set forth on Exhibit C. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices a Defects Notice shall be determined based upon the criteria set forth below: (i) If the if a Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset.; however, in no event may this amount exceed $3,650 per net mineral acre of the property in question; (ii) If the if a Title Defect asserted is that the Net Revenue Interest net mineral leasehold acres attributable to any Well or unit or Well location is a Lease totals less than that stated in the net mineral leasehold acres as shown on Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit CA, then the Title Defect Value thereof shall take into account be an amount equal to the relative change in product of that Lease’s per acre Allocated Value multiplied by the interest from difference between the net mineral leasehold acres attributable to that Lease as shown on Exhibit C A and the appropriate Allocated Value attributed number of net mineral leasehold acres actually attributable to such Asset.the Lease; (iii) If the if a Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset., and the Defect Values placed upon the Title Defect by Buyer and Sellers; (iv) If if a Title Defect is not then currently in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value.; (v) The the Defect Value of a Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder.; (vi) Notwithstanding notwithstanding anything herein to the contrary, in no event shall the Defect Value of a Title Defect Value may not exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby.Asset; (vii) Such Buyer’s right to assert Title Defects hereunder shall not be diminished or otherwise adversely affected by any materiality qualification contained in any of Sellers’ representations and warranties in Article V hereof; and (viii) such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any AssetIn order to exercise its rights under this Section, Buyer shall notify provide Seller as promptly as possible, but notice of all Title Defects no later than 5:00 p.m. CST on March 8, 2011 (the expiration of the Examination Period of such alleged "Title DefectClaim Date"). To be effective, such notice must (ia) be in writing, (iib) be received by Seller by 5:00 p.m. Central Standard Time on or prior to the expiration date of the Examination Period and Title Claim Date, (iiic) describe the Title Defect in reasonable detaildetail (including any alleged variance in the Net Revenue Interest or Working Interest), to (d) identify the extent then specific Asset or Assets affected by such Title Defect, (e) include the Title Defect Value, as reasonably known determined by Buyer in good faith, and (including f) comply with the estimated value of such limitations and Title Defect as determined by Buyer)Value qualifications set forth in Section 4.14. Any matters that may otherwise constitute Title Defects, but of which Seller has not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Encumbrances and Assumed Obligations hereunder. Upon receipt of notices of Title Defects, the Parties shall meet and determine upon which of the Title Defects, Title Defect Values, and methods of cure the Parties have reached agreement. Upon the receipt of such effective notice from Buyer, Seller, at Seller’s Seller shall have the option, shall but not the obligation, for a period ending ninety (i90) subject to Section 3.05(a), attempt days after the Closing to cure such defect. If Seller should not elect to cure a Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale Defect, and reduce no aspect of such defect is reasonably in dispute, the Purchase Price shall be adjusted for such defect by the Allocated Value amount of such affected Asset as set forth on Exhibit C.the Title Defect Value. (ca) The value attributable to each Title Defect (the “"Title Defect Value”") that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset.; (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well Well, PUD Location, PDNP, or unit or Well location Probable and/or Possible Locations is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit C, then the Title Defect Value shall take into account be the relative change in absolute value of the interest from Exhibit C and number determined by the appropriate following formula: Title Defect Value = A x (1-[B/C]) A = Allocated Value attributed to such Asset.for the affected Asset B = Correct Net Revenue Interest for the affected Asset C = Net Revenue Interest for the affected Asset as set forth on Exhibit C. (iii) If the Title Defect represents an obligation, encumbrance, burden burden, or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset., and the Title Defect Values placed upon the Title Defect by Buyer and Seller; (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire post Effective Time productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value.; (v) The Title Defect Value of a Title Defect shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder.; (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the WxxxxXxxxx, units PUD Locations, PDNP, Probable and/or Possible Locations, or other Assets affected thereby.; (vii) If the Title Defect Value of an Asset is equal to the Allocated Value of such Asset, the affected Asset shall remain in the purchase and sale contemplated by this Agreement, but the Purchase Price shall be adjusted accordingly; (viii) Notwithstanding the provisions of this Section 4.03 to the contrary, the Title Defect Value of any Title Defect comprising a required consent not obtained (other than consents customarily obtained after Closing) shall be determined subject to any accommodation implemented pursuant to Section 4.07; and (ix) Such other factors as are reasonably necessary to make a proper evaluation. (b) The term Title Defect shall not include: (i) Defects based solely on an assertion that Seller's files lack information, provided that any missing material information can be obtained by the reasonable efforts of Buyer; (ii) Defects in the early chain of title consisting of the failure to recite marital status in a document or omissions of successors of heirship or estate proceedings, unless Buyer provides a reasonable basis for the assertion that such failure or omission has resulted in a third party's actual and superior claim of title to the affected Asset; (iii) Defects arising out of lack of survey; (iv) Defects arising out of lack of corporate or other entity authorization unless Buyer provides a reasonable basis for the assertion that the action was not authorized and that such lack of authorization has resulted in a third party's actual and superior claim of title to the affected Asset; (v) [Intentionally Omitted] (vi) Defects asserting a change in an applicable Working Interest or Net Revenue Interest based on a change in drilling and spacing units, tract allocation or other changes in pooling or unit participation occurring after the date of this Agreement; (vii) Those matters that do not impair marketability in accordance with the applicable title standards for the State in which the affected Asset is located; (viii) Title requirements customarily considered as advisory or which can be waived as a matter of prudent business judgment; and (ix) The lack of title in the name of Seller as to those Assets in which Seller's rights and interest are created by an operating agreement or any other instrument by which Seller has rights or interests, or has the right to acquire other interests.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify Seller of the alleged Title Defect as promptly as possible, possible but no later than the expiration of the Examination Period of such alleged Title DefectPeriod. To be effective, such this notice (a “Title Defect Notice”) must (i) be in writing, ; (ii) be received by Seller by 5:00 p.m. Central Standard Time on prior to the expiration date of the Examination Period and Period; (iii) describe the Title Defect in reasonable detailsufficient, to the extent then reasonably known by Buyer specific detail (including any alleged variance in the estimated Net Revenue Interest or Working Interest); (iv) identify the specific Asset or Assets affected by the Title Defect; and (v) include the value of such the Title Defect as determined by Buyer). Any matters that otherwise may otherwise constitute have constituted Title Defects, but of which Seller has that are not been notified by Buyer so described in a timely Title Defect Notice complying and delivered in accordance with the foregoingthis Section 4.04(a), shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon the After receipt of such an effective notice from BuyerTitle Defect Notice, Seller, at Seller’s Seller shall have the option, shall (i) subject but not the obligation, to Section 3.05(a), attempt to cure such the Title Defect at any time prior to the Closing or and to postpone the Closing Date up to thirty (ii30) exclude days beyond the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as date set forth on Exhibit C.in Section 12.01 to facilitate the cure. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the a Title Defect notices Notice shall be determined in good faith based upon the criteria set forth below: (i) If the Title Defect is a lien upon on any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well well, unit, well location or unit or Well location Lease is less than that stated in Exhibit C B or the Working Interest attributable to any Well well, unit, well location or unit or Well location Lease is greater than that stated in Exhibit CB, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C B and the appropriate Allocated Value attributed to of such Asset. (iii) If . For purposes of this Agreement, the Title Defect represents an obligationterm “Allocated Value” means, encumbrance, burden or charge upon the affected Asset (including with respect to any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidatedAsset, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the allocated to that Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Assetunder Section 11.01. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify provide Seller as promptly as possible, but notice of all Title Defects no later than 5:00 p.m. MST on the expiration of date which is seven (7) days prior to the Examination Period of such alleged Closing Date (the “Title DefectClaim Date”). To be effective, such notice must (ia) be in writing, (iib) be received by Seller by 5:00 p.m. Central Standard Time on or prior to the expiration date of the Examination Period and Title Claim Date, (iiic) describe the Title Defect (including any alleged variance in reasonable detailthe Net Revenue Interest or Working Interest), to (d) identify the extent then specific Asset or Assets affected by such Title Defect, (e) include the Title Defect Value, as reasonably known determined by Buyer in good faith, and (including f) comply with the estimated value of such limitations and Title Defect as determined by Buyer)Value qualifications set forth in Section 4.14. Any matters identified by Buyer during the Examination Period that may otherwise constitute Title Defects, but of which Seller has not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Encumbrances and Assumed Obligations hereunder. Upon receipt of notices of Title Defects, the Parties shall meet and determine upon which of the Title Defects, Title Defect Values, and methods of cure the Parties have reached agreement. Upon the receipt of such effective notice from Buyer, Seller, at Seller’s Seller shall have the option, shall but not the obligation, for a period ending ninety (i90) subject to Section 3.05(a), attempt days after the Closing to cure such defect. If Seller should not elect to cure a Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale Defect, and reduce no aspect of such defect is reasonably in dispute, the Purchase Price shall be adjusted for such defect by the Allocated Value amount of such affected Asset as set forth on Exhibit C.the Title Defect Value. (ca) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset.; (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well Well, PUD Location, PDNP, or unit or Well location Probable and/or Possible Locations is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit CD, then the Title Defect Value shall take into account be the relative change in absolute value of the interest from Exhibit C and number determined by the appropriate following formula: Title Defect Value = A x (1-[B/C]) A = Allocated Value attributed to such Asset.for the affected Asset B = Correct Net Revenue Interest for the affected Asset C = Net Revenue Interest for the affected Asset as set forth on Exhibit D. (iii) If the Title Defect represents an obligation, encumbrance, burden burden, or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset., and the Title Defect Value placed upon the Title Defect by Buyer and Seller; (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire post Effective Time productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value.; (v) The Title Defect Value of a Title Defect shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder.; (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the WxxxxXxxxx, units PUD Locations, PDNP, Probable and/or Possible Locations, or other Assets affected thereby.; (vii) If the Title Defect Value of an Asset is equal to the Allocated Value of such Asset, the affected Asset shall remain in the purchase and sale contemplated by this Agreement, but the Purchase Price shall be adjusted accordingly; (viii) Notwithstanding the provisions of this Section 4.03 to the contrary, the Title Defect Value of any Title Defect comprising a required consent not obtained (other than governmental consents customarily obtained after Closing) shall be determined pursuant to Section 4.07; and (ix) Such other factors as are reasonably necessary to make a proper evaluation. (b) The term Title Defect shall not include those matters deemed not to impair marketability in accordance with the applicable title standards for the state in which the affected Asset(s) is located.

Notice of Title Defects. (a) If Buyer Xxxxx discovers any Title Defect affecting any Asset, Buyer shall notify Seller of the alleged Title Defect as promptly as possible, possible but no later than the expiration of the Examination Period of such alleged Title DefectPeriod. To be effective, such this notice (a “Title Defect Notice”) must (i) be in writing, ; (ii) be received by Seller by 5:00 p.m. Central Standard Time on prior to the expiration date of the Examination Period and Period; (iii) describe the Title Defect in reasonable detailsufficient, to the extent then reasonably known by Buyer specific detail (including any alleged variance in the estimated Net Revenue Interest or Working Interest); (iv) identify the specific Asset or Assets affected by the Title Defect; and (v) include the value of such the Title Defect as determined by Buyer). Any matters that otherwise may otherwise constitute have constituted Title Defects, but of which Seller has that are not been notified by Buyer so described in a timely Title Defect Notice complying and delivered in accordance with the foregoingthis Section 4.04(a), shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Upon the After receipt of such an effective notice from BuyerTitle Defect Notice, Seller, at Seller’s Seller shall have the option, shall (i) subject but not the obligation, to Section 3.05(a), attempt to cure such the Title Defect at any time prior to the Closing or and to postpone the Closing Date up to thirty (ii30) exclude days beyond the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as date set forth on Exhibit C.in Section 12.01 to facilitate the cure. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the a Title Defect notices Notice shall be determined in good faith based upon the criteria set forth below: (i) If the Title Defect is a lien upon on any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well well, unit, well location or unit or Well location Lease is less than that stated in Exhibit C B or the Working Interest attributable to any Well or well, unit or Well well location is greater than that stated in Exhibit CB, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C B and the appropriate Allocated Value attributed to of such Asset. (iii) If . For purposes of this Agreement, the Title Defect represents an obligationterm “Allocated Value” means, encumbrance, burden or charge upon the affected Asset (including with respect to any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidatedAsset, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the allocated to that Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Assetunder Section 11.01. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify provide Seller as promptly as possible, but notice of all Title Defects no later than 5:00 p.m. MST on the expiration of date which is seven (7) days prior to the Examination Period of such alleged Closing Date (the “Title DefectClaim Date”). To be effective, such notice must (ia) be in writing, (iib) be received by Seller by 5:00 p.m. Central Standard Time on or prior to the expiration date of the Examination Period and Title Claim Date, (iiic) describe the Title Defect in reasonable detaildetail (including any alleged variance in the Net Revenue Interest or Working Interest), to (d) identify the extent then specific Asset or Assets affected by such Title Defect, (e) include the Title Defect Value, as reasonably known determined by Buyer in good faith, and (including f) comply with the estimated value of such limitations and Title Defect as determined by Buyer)Value qualifications set forth in Section 4.14. Any matters identified by Buyer during the Examination Period that may otherwise constitute Title Defects, but of which Seller has not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Encumbrances and Assumed Obligations hereunder. Upon receipt of notices of Title Defects, the Parties shall meet and determine upon which of the Title Defects, Title Defect Values and methods of cure the Parties have reached agreement. Upon the receipt of such effective notice from Buyer, Seller, at Seller’s Seller shall have the option, shall but not the obligation, for a period ending ninety (i90) subject to Section 3.05(a), attempt days after the Closing to cure such defect. If Seller should not elect to cure a Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale Defect, and reduce no aspect of such defect is reasonably in dispute, the Purchase Price shall be adjusted for such defect by the Allocated Value amount of such affected Asset as set forth on Exhibit C.the Title Defect Value. (ca) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset.; (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well Well, PUD Location, PDNP, or unit or Well location Probable and/or Possible Locations is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit CD, then the Title Defect Value shall take into account be the relative change in absolute value of the interest from Exhibit C and number determined by the appropriate following formula: Title Defect Value = A x (1-[B/C]) A = Allocated Value attributed to such Asset.for the affected Asset B = Correct Net Revenue Interest for the affected Asset C = Net Revenue Interest for the affected Asset as set forth on Exhibit D. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset., and the Title Defect Values placed upon the Title Defect by Buyer and Seller; (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire post Effective Time productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value.; (v) The Title Defect Value of a Title Defect shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder.; (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxx, units PUD Locations, PDNP, Probable and/or Possible Locations, or other Assets affected thereby.; (vii) If the Title Defect Value of an Asset is equal to the Allocated Value of such Asset, the affected Asset shall be excluded from the purchase and sale contemplated by this Agreement, and the Purchase Price shall be adjusted accordingly; (viii) Notwithstanding the provisions of this Section 4.03 to the contrary, the Title Defect Value of any Title Defect comprising a required consent not obtained (other than consents customarily obtained after Closing) shall be determined subject to any accommodation implemented pursuant to Section 4.07; and (ix) Such other factors as are reasonably necessary to make a proper evaluation. (b) The term Title Defect shall not include: (i) Defects based solely on an assertion that Seller’s files lack information, provided that any missing material information can be obtained by the reasonable efforts of Buyer; (ii) Defects in the early chain of title consisting of the failure to recite marital status in a document or omissions of successors of heirship or estate proceedings, unless Buyer provides a reasonable basis for the assertion that such failure or omission has resulted in a third party’s actual and superior claim of title to the affected Asset; (iii) Defects arising out of lack of survey; (iv) Defects arising out of lack of corporate or other entity authorization unless Buyer provides a reasonable basis for the assertion that the action was not authorized and that such lack of authorization has resulted in a third party’s actual and superior claim of title to the affected Asset; (v) Defects that are defensible by possession under applicable statutes of limitations for adverse possession or for prescription; provided that the mere passage of time in and of itself shall not establish any presumption of the applicability of the provisions of this Section 4.03(b)(v); (vi) Defects asserting a change in an applicable Working Interest or Net Revenue Interest based on a change in drilling and spacing units, tract allocation or other changes in pooling or unit participation occurring after the date of this Agreement; and (vii) Title requirements customarily considered as advisory or which can be waived as a matter of prudent business judgment.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify Seller as promptly as possible, but no later than the expiration of the Title Examination Period of such alleged Title Defect. To be effective, such notice must (i) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on prior to the expiration date of the Title Examination Period and Period, (iii) describe the Title Defect in reasonable detailsufficient, to the extent then reasonably known by Buyer specific detail (including any alleged variance in the estimated value of Net Revenue Interest), (iv) identify the specific Asset or Assets affected by such Title Defect as determined by Buyer)Defect. Any matters that may otherwise constitute Title Defects, but of which Seller has not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted EncumbrancesEncumbrances and Assumed Obligations hereunder. (b) Upon the receipt of such effective notice from Buyer, SellerSeller and Buyer shall attempt to mutually agree on a resolution including, at Seller’s option, shall but not limited to (i) subject to Section 3.05(a), attempt to cure such Title Defect at any time prior to the Closing or Closing, (ii) exclude the affected Asset from the sale and reduce the Purchase Price by the Allocated Value mutually agreed allocated value of such affected Asset Asset, or (iii) not take any action with respect to the alleged Title Defect and Seller shall indemnify Buyer pursuant to Section 14.04 against all costs which Buyer may incur in connection with same. As soon as set forth on Exhibit C.possible after providing notice of any Title Defect, Buyer agrees to provide to Seller copies of all data, title opinions and other documents and information in Buyer’s possession or control that are not privileged and that bear upon or relate to the alleged Title Defect and Buyer’s determination of the Title Defect Value, and include the value of such Title Defect as reasonably determined by Buyer in good faith. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well Subject Interest or unit or Well location the Working Interest is less than that stated in Exhibit C A or the Working Interest attributable to any Well well or unit or Well location is greater than that stated in Exhibit CA, then the Title Defect Value shall take into account be the relative change in absolute value of the interest from Exhibit C and number determined by the appropriate following formula: Title Defect Value = A x (1-[B/C]) A = Allocated Value attributed to such Asset.for the affected Asset B = Correct Net Revenue Interest for the affected Asset C = Net Revenue Interest for the affected Asset as set forth on Exhibit A (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset, and the Title Defect Values placed upon the Title Defect by Buyer and Seller. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) The Title Defect Value of a Title Defect shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the Wxxxxxxxxx, units or other Assets affected thereby. (vii) Such other factors as are reasonably necessary to make a proper evaluation.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify provide Seller as promptly as possible, but notice of all Title Defects no later than 5:00 p.m. MST on the expiration of date which is seven (7) days prior to the Examination Period of such alleged Closing Date (the "Title DefectClaim Date"). To be effective, such notice must (ia) be in writing, (iib) be received by Seller by 5:00 p.m. Central Standard Time on or prior to the expiration date of the Examination Period and Title Claim Date, (iiic) describe the Title Defect in reasonable detaildetail (including any alleged variance in the Net Revenue Interest or Working Interest), to (d) identify the extent then specific Asset or Assets affected by such Title Defect, (e) include the Title Defect Value, as reasonably known determined by Buyer in good faith, and (including f) comply with the estimated value of such limitations and Title Defect as determined by Buyer)Value qualifications set forth in Section 4.14. Any matters identified by Buyer during the Examination Period that may otherwise constitute Title Defects, but of which Seller has not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes and shall constitute Permitted Encumbrances. (b) Encumbrances and Assumed Obligations hereunder. Upon receipt of notices of Title Defects, the Parties shall meet and determine upon which of the Title Defects, Title Defect Values and methods of cure the Parties have reached agreement. Upon the receipt of such effective notice from Buyer, Seller, at Seller’s Seller shall have the option, shall but not the obligation, for a period ending ninety (i90) subject to Section 3.05(a), attempt days after the Closing to cure such defect. If Seller should not elect to cure a Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale Defect, and reduce no aspect of such defect is reasonably in dispute, the Purchase Price shall be adjusted for such defect by the Allocated Value amount of such affected Asset as set forth on Exhibit C.the Title Defect Value. (ca) The value attributable to each Title Defect (the “"Title Defect Value”") that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected to be necessary to be paid to remove the lien from the affected Asset.; (ii) If the Title Defect asserted is that the Net Revenue Interest attributable to any Well Well, PUD Location, PDNP, or unit or Well location Probable and/or Possible Locations is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit CD, then the Title Defect Value shall take into account be the relative change in absolute value of the interest from Exhibit C and number determined by the appropriate following formula: Title Defect Value = A × (1-[B/C]) A = Allocated Value attributed to such Asset.for the affected Asset B = Correct Net Revenue Interest for the affected Asset C = Net Revenue Interest for the affected Asset as set forth on Exhibit D. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset., and the Title Defect Values placed upon the Title Defect by Buyer and Seller; (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire post Effective Time productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value.; (v) The Title Defect Value of a Title Defect shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder.; (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value exceed the Allocated Value of the WxxxxXxxxx, units PUD Locations, PDNP, Probable and/or Possible Locations, or other Assets affected thereby.; (vii) If the Title Defect Value of an Asset is equal to the Allocated Value of such Asset, the affected Asset shall be excluded from the purchase and sale contemplated by this Agreement, and the Purchase Price shall be adjusted accordingly; (viii) Notwithstanding the provisions of this Section 4.03 to the contrary, the Title Defect Value of any Title Defect comprising a required consent not obtained (other than consents customarily obtained after Closing) shall be determined subject to any accommodation implemented pursuant to Section 4.07; and (ix) Such other factors as are reasonably necessary to make a proper evaluation. (b) The term Title Defect shall not include: (i) Defects based solely on an assertion that Seller's files lack information, provided that any missing material information can be obtained by the reasonable efforts of Buyer; (ii) Defects in the early chain of title consisting of the failure to recite marital status in a document or omissions of successors of heirship or estate proceedings, unless Buyer provides a reasonable basis for the assertion that such failure or omission has resulted in a third party's actual and superior claim of title to the affected Asset; (iii) Defects arising out of lack of survey; (iv) Defects arising out of lack of corporate or other entity authorization unless Buyer provides a reasonable basis for the assertion that the action was not authorized and that such lack of authorization has resulted in a third party's actual and superior claim of title to the affected Asset; (v) Defects that are defensible by possession under applicable statutes of limitations for adverse possession or for prescription; provided that the mere passage of time in and of itself shall not establish any presumption of the applicability of the provisions of this Section 4.03(b)(v); (vi) Defects asserting a change in an applicable Working Interest or Net Revenue Interest based on a change in drilling and spacing units, tract allocation or other changes in pooling or unit participation occurring after the date of this Agreement; and (vii) Title requirements customarily considered as advisory or which can be waived as a matter of prudent business judgment.

Notice of Title Defects. (a) If Buyer discovers any Title Defect affecting any Asset, Buyer shall notify deliver to Seller as promptly as possiblea written “Notice of Title Defects” on or before March 31, but no later than the expiration 2009. The Notice of the Examination Period of such alleged Title Defect. To be effective, such notice must (i) be in writing, (ii) be received by Seller by 5:00 p.m. Central Standard Time on the expiration date of the Examination Period and (iii) Defects shall describe the Title Defect and state the reduction in reasonable detail, to the extent then reasonably known Allocated Value of an Asset caused by Buyer (including the estimated value of such Title Defect as determined by Buyer(the “Defect Value”). Any Other than matters that may otherwise constitute which are violative of Seller’s special warranty of title set out in Exhibit I, any matters not described in a written Notice of Title Defects, but of which Seller has not been notified by Buyer in accordance with the foregoing, Defect shall conclusively be deemed to have been waived and accepted by Buyer for all purposes Buyer, and shall constitute be deemed Permitted Encumbrances. (b) Upon Encumbrances hereunder. In determining the receipt of such effective notice from Buyer, Seller, at Seller’s option, shall (i) subject to Section 3.05(a), attempt to cure such Title Defect at any time prior to the Closing or (ii) exclude the affected Asset from the sale and reduce the Purchase Price by the Allocated Value of such affected Asset as set forth on Exhibit C. (c) The value attributable to each Title Defect (the “Title Defect Value”) that is asserted by Buyer in the Title Defect notices shall be determined based upon the criteria set forth below: (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is the amount reasonably expected Parties intend to be necessary to be paid to remove the lien from the affected Asset. (ii) If the Title Defect asserted is include only that the Net Revenue Interest attributable to any Well or unit or Well location is less than that stated in Exhibit C or the Working Interest attributable to any Well or unit or Well location is greater than that stated in Exhibit C, then the Title Defect Value shall take into account the relative change in the interest from Exhibit C and the appropriate Allocated Value attributed to such Asset. (iii) If the Title Defect represents an obligation, encumbrance, burden or charge upon the affected Asset (including any increase in Working Interest for which there is not a proportionate increase in Net Revenue Interest) for which the economic detriment to Buyer is unliquidated, the amount of the Title Defect Value shall be determined by taking into account the Allocated Value of the affected Asset, the portion of the Asset affected by the Title Defect, the legal effect of the Title Defect, the potential discounted economic effect of the Title Defect over the life of the affected Asset. (iv) If a Title Defect is not in effect or does not adversely affect an Asset throughout the entire productive life of such Asset, such fact shall be taken into account in determining the Title Defect Value. (v) . The Title Defect Value shall be determined without duplication of any costs or losses included in another Title Defect Value hereunder. (vi) Notwithstanding anything herein to the contrary, in no event shall a Title Defect Value may not exceed the Allocated Value of the WxxxxAsset and shall be determined by the Parties in good faith, units taking into account all relevant factors, including without limitation the following: i. If the Title Defect is a lien or other Assets affected therebyencumbrance on the Asset created by Seller, and such lien or encumbrance is unconditionally released at or prior to Closing, there shall be no Defect Value associated with such lien or encumbrance. ii. If the Title Defect is an actual reduction in NRI or any other matter that does not fall within the matters described in subsection i., then the Buyer will rerun its ARIES based calculation (viior similar program) Such other factors that resulted in the Allocated Value for the affected portion of the Assets using the same economic and engineering criteria except as are reasonably necessary changed to make a proper evaluationaccommodate the Title Defect to calculate the impact on the Allocated Value for the affected Asset. This revised calculation of the Allocated Value will be presented to Seller, and Buyer and Seller will act in good faith to reach mutual agreement as to the diminution effect of the Title Defect and thus the Defect Value.