Common use of Remedies for Environmental Defects Clause in Contracts

Remedies for Environmental Defects. (a) Sellers and Purchaser shall attempt to agree on a resolution with respect to any Environmental Defect prior to Closing. Sellers may, at their collective option (and at their sole cost, risk, and expense), attempt to cure such Environmental Defect at any time prior to Closing. For each claim asserted by Purchaser for an Environmental Defect, with respect to which the Parties cannot agree upon the Environmental Defect or the Environmental Defect Value (or whether or to what extent the Environmental Defect has been cured or remediated), at the sole option of Purchaser, (i) Sellers shall deliver to Purchaser a written indemnity agreement, in form and substance reasonable satisfactory to Purchaser, under which Sellers agree to fully, jointly and severally indemnify Purchaser from any and all losses, costs, expenses, claims and damages (including diminution in value) arising out of, or resulting from, such Environmental Defect (in which case there shall be no reduction in the Purchase Price), provided that such indemnification obligation shall be limited to the Allocated Value for the affect Asset, or (ii) the Purchase Price shall be reduced by the Environmental Defect Value with respect to each Environmental Defect (or, subject to Section 6.5, in the event that the Parties to not agree upon the existence of an Environmental Defect, or the Environmental Defect Value with respect thereto, Purchaser’s estimate of the Environmental Defect), provided that such reduction in the Purchase Price shall not exceed the Allocated Value for the affected Asset. Notwithstanding the foregoing, in the event that the aggregate of all Environmental Defects affecting an Asset exceeds the Allocated Value of such Asset, such Asset shall be removed the from the transactions contemplated by this Agreement and the Purchase Price shall be reduced by the Allocated Value of the Assets, subject to Section 6.5.

Remedies for Environmental Defects. (a) Sellers Subject to Seller’s continuing right to dispute the existence of an Environmental Defect and Purchaser shall attempt to agree on a resolution the Remediation Amount asserted with respect to any Environmental Defect prior to Closing. Sellers may, at their collective option (and at their sole cost, risk, and expense), attempt to cure such Environmental Defect at any time prior to Closing. For each claim asserted by Purchaser for an Environmental Defect, with respect to which the Parties cannot agree upon the Environmental Defect or the Environmental Defect Value (or whether or to what extent the Environmental Defect has been cured or remediated), at the sole option of Purchaser, (i) Sellers shall deliver to Purchaser a written indemnity agreement, in form and substance reasonable satisfactory to Purchaser, under which Sellers agree to fully, jointly and severally indemnify Purchaser from any and all losses, costs, expenses, claims and damages (including diminution in value) arising out of, or resulting from, such Environmental Defect (in which case there shall be no reduction in the Purchase Price), provided that such indemnification obligation shall be limited to the Allocated Value for the affect Asset, or (ii) the Purchase Price shall be reduced by the Environmental Defect Value with respect to each Environmental Defect (or, subject to Section 6.5thereto, in the event that the Parties to not agree upon the existence of an Environmental Defect, or the any alleged Environmental Defect Value timely and properly asserted by Purchaser in accordance with respect theretoSection 9.4(b) has an associated Remediation Amount that exceeds the Individual Environmental Defect Threshold, Purchaser’s estimate of the and such Environmental Defect)Defect is not waived in writing by Purchaser or Remediated on or before Closing, provided that such reduction in Seller shall, at its sole option, elect to: (i) reduce the Purchase Price shall not exceed by the Allocated Value Remediation Amount for such alleged Environmental Defect; (ii) if the affected Asset. Notwithstanding the foregoing, in the event Parties agree that the aggregate Remediation Amount exceeds seventy-five percent (75%) of all Environmental Defects affecting an Asset exceeds the Allocated Value of such Assetthe Purchased Asset(s) affected by the Environmental Defect, such exclude said Purchased Asset from this Agreement in which case the Purchased Asset(s) affected by the Environmental Defect, including the associated Leases and Equipment, shall be removed the from the transactions contemplated by this Agreement Excluded Assets and the Purchase Price shall be reduced by an amount equal to the Allocated Value of the Purchased Asset(s) affected by the Environmental Defect; (iii) proceed to Closing without any adjustment of the Purchase Price for the Environmental Defect and resolve any remaining Environmental Disputed Matter post-Closing in accordance with Section 9.4(d) of this Agreement; or (iv) prior to the Closing resolve the alleged Environmental Defect by other agreement of the Parties. Seller shall advise Purchaser in writing of its election above no later than twenty-four (24) hours before the Closing. If Seller fails to timely notify Purchaser of its election above, then Seller shall be deemed to have accepted the Remediation Amount proposed by Purchaser and Seller shall be deemed to have elected the option set forth in clause (i) above. If Seller elects the option set forth in clause (i) above, Purchaser shall be deemed to have assumed responsibility for all costs and expenses attributable to the Remediation of the applicable Environmental Defect (net to the Purchased Assets) and all Liabilities (net to the Purchased Assets), subject including Environmental Liabilities, with respect thereto, and Purchaser’s obligations with respect to Section 6.5the foregoing shall be deemed to constitute part of the Assumed Obligations.

Remedies for Environmental Defects. (a) Sellers and Purchaser shall attempt to agree on a resolution with respect to In the event any Environmental Defect prior relating to any of the Assets for which notice has been timely given as provided hereinabove, remains uncured as of Closing. Sellers may, Seller, at their collective option (and at their its sole costoption, risk, and expense), attempt to cure such Environmental Defect at any time prior to Closing. For each claim asserted by Purchaser for an Environmental Defect, with respect to which the Parties cannot agree upon the Environmental Defect or the Environmental Defect Value (or whether or to what extent the Environmental Defect has been cured or remediated), at the sole option of Purchaser, shall (i) Sellers shall deliver agree prior to Purchaser a written indemnity agreementClosing to cure or remediate, in form and substance reasonable satisfactory to Purchaser, under which Sellers agree to fully, jointly and severally indemnify Purchaser from any and all losses, costs, expenses, claims and damages (including diminution in value) arising out of, or resulting fromat Seller’s expense, such Environmental Defect (in which case there shall be no as soon as reasonably possible after Closing and without any reduction in to the Purchase Price), provided that such indemnification obligation shall be limited Price in a manner acceptable to the Allocated Value for the affect Assetboth Parties, or (ii) reduce the Purchase Price shall be reduced by the Environmental amount of the Defect Value with respect as determined pursuant to each Environmental Defect (orSection 8.4, subject to the Thirty Thousand and No/100 Dollars ($30,000.00) threshold described in Section 6.5, 7.1 and the Defect Baskets described in the event that the Parties to not agree upon the existence Section 7.4. Neither (i) (remediation) nor (ii) (reduction of an Environmental Defect, or the Environmental Defect Value with respect thereto, Purchaser’s estimate of the Environmental Defect), provided that such reduction in the Purchase Price Price) shall not exceed the Allocated Value for the affected Asset. Notwithstanding the foregoing, in the event that the aggregate of all Environmental Defects affecting an Asset exceeds the Allocated Value of such Assetaffected Assets. If Seller elects the option set forth in clause (ii) above, such Asset Buyer shall be removed deemed to have assumed its proportionate share of such Environmental Defect and all Liabilities with respect thereto. If Seller elects the option set forth in clause (i) above, Seller shall use commercially reasonable efforts to implement such remediation in a manner which is consistent with the requirements of Environmental Laws in a timely fashion for the type of remediation that Seller elects to undertake and shall have access to the affected Assets after the Closing Date to implement and complete such remediation. Seller will be deemed to have adequately completed the remediation required in the immediately preceding sentence (a) upon receipt of approval from the transactions contemplated by this Agreement and applicable Governmental Entities that the remediation has been implemented to the extent necessary to comply with existing regulatory requirements or (b) upon receipt of a certificate from a third Person licensed professional engineer that the remediation has been implemented to the extent necessary to comply with applicable Environmental Laws. Defect Baskets. The Parties agree that adjustments to the Purchase Price under Article 7 and Article 8 shall only occur to the extent that the Defect Value for all Environmental Defects exceeds Three Hundred Thousand and No/100 Dollars ($300,000.00) after taking the applicable materiality threshold into account and the Defect Value for all Title Defects exceeds Three Hundred Thousand and No/100 Dollars ($300,000.00) after taking the applicable materiality threshold into account. (the “Defect Baskets”), after taking the applicable materiality deductibles into account. For the purpose of clarity, each Defect Basket shall be reduced by the Allocated Value of the Assets, subject to Section 6.5a threshold and not a deductible and there may be adjustments for Environment Defects and not Title Defects and vice versa.

Remedies for Environmental Defects. (a) Sellers Subject to Seller’s continuing right to dispute the existence of an Environmental Defect and Purchaser shall attempt to agree on a resolution the Remediation Amount asserted with respect to any Environmental Defect prior to Closing. Sellers may, at their collective option (and at their sole cost, risk, and expense), attempt to cure such Environmental Defect at any time prior to Closing. For each claim asserted by Purchaser for an Environmental Defect, with respect to which the Parties cannot agree upon the Environmental Defect or the Environmental Defect Value (or whether or to what extent the Environmental Defect has been cured or remediated), at the sole option of Purchaser, (i) Sellers shall deliver to Purchaser a written indemnity agreement, in form and substance reasonable satisfactory to Purchaser, under which Sellers agree to fully, jointly and severally indemnify Purchaser from any and all losses, costs, expenses, claims and damages (including diminution in value) arising out of, or resulting from, such Environmental Defect (in which case there shall be no reduction in the Purchase Price), provided that such indemnification obligation shall be limited to the Allocated Value for the affect Asset, or (ii) the Purchase Price shall be reduced by the Environmental Defect Value with respect to each Environmental Defect (or, subject to Section 6.5thereto, in the event that any Environmental Defect timely and properly asserted by Purchaser in accordance with Section 5.4(b) has an associated Remediation Amount that exceeds the Parties to Individual Environmental Defect Threshold, and such Environmental Defect is not agree upon waived in writing by Purchaser or Remediated on or before Closing, Seller shall, at its sole option, elect to: (i) reduce the existence of an Purchase Price by the Remediation Amount for such Environmental Defect; (ii) exclude the Well, well site, and dedicated tank battery, Centralized Tank Battery and associated xxxxx (and site relating to same), or salt water disposal or injection facility (and site relating to same) affected by the Environmental Defect Value with respect thereto, Purchaser’s estimate and all of the Environmental Defect), provided that such reduction in associated Purchased Assets required for or the Purchase Price shall not exceed the Allocated Value for the affected Asset. Notwithstanding result of operation of the foregoing, including the associated Leases and Equipment, in which case the event that Purchased Assets affected by the aggregate of all alleged Environmental Defects affecting an Asset exceeds the Allocated Value of such Asset, such Asset Defect shall be removed the from the transactions contemplated by this Agreement Excluded Assets and the Purchase Price shall be reduced by an amount equal to the Allocated Value of the Purchased Assets affected by the Environmental Defect; or (iii) proceed to Closing without any adjustment of the Purchase Price for the Environmental Defect and resolve any remaining Environmental Disputed Matter post-Closing in accordance with Section 5.4(d) of this Agreement. Seller shall advise Purchaser in writing of its election above no later than twenty-four (24) hours before the Closing. If Seller fails to timely notify Purchaser of its election above, then Seller shall be deemed to have accepted the Remediation Amount proposed by Purchaser and Seller shall be deemed to have elected the option set forth in clause (i) above. If Seller elects the option set forth in clause (i) above, Purchaser shall be deemed to have assumed responsibility for all costs and expenses attributable to the Remediation of the applicable Environmental Defect (net to the Purchased Assets) and all Liabilities (net to the Purchased Assets), subject including Environmental Liabilities, with respect thereto, and Purchaser’s obligations with respect to Section 6.5.the foregoing shall be deemed to constitute part of the Assumed Obligations. Notwithstanding anything contained hereinabove, in the event that the Parties agree that the Remediation Amount exceeds seventy-five percent (75%) of the Allocated Value of the Purchased Asset(s) affected by the Environmental Defect, Purchaser shall have the option to exclude said Purchased Asset from this Agreement in which case the Purchased Asset(s) affected by the Environmental Defect, including the associated Leases and Equipment, shall be Excluded Assets and the Purchase Price shall be reduced by an amount equal to the Allocated Value of the Purchased Asset(s) affected by the Environmental Defect. No later than forty-eight (48) hours before the Closing, Purchaser shall advise Seller in writing of its election to exclude any Purchased Asset for the reason that the Remediation Amount associated with the Environmental Defect alleged to be affecting such Purchased Asset exceeds seventy-five percent (75%) of the Allocated Value of such Purchased Asset. If Seller disputes that the value of the Remediation Amount exceeds seventy-five percent (75%) of the Allocated Value of such Purchased Asset alleged to be affected by the Environmental Defect, Seller shall advise Purchaser in writing no later than twenty-four (24) hours before the Closing of Seller’s election of either clause (ii) or (iii) above as the remedy for such Environmental Defect. Initials: Seller _________ Purchaser _________ 20

Remedies for Environmental Defects. Subject to the limitations set forth in Section 5.05: (a) With respect to each Environmental Defect asserted prior to the Claim Date, Sellers shall take one of the following actions within ten (10) days after the Claim Date unless Sellers and Purchaser shall attempt to Buyer otherwise agree: (i) agree on a resolution with respect to any Environmental Defect prior to Closing. Sellers may, at their collective option (and at their sole cost, risk, and expense), attempt to cure that such Environmental Defect at any time prior is valid, in which event the Seller Representative and Buyer shall jointly instruct the Escrow Agent to Closing. For each claim asserted by Purchaser for an disburse from the Title/Environmental Defect, with respect Escrow to which Buyer the Parties cannot agree upon portion of the Environmental Defect or the Environmental Defect Value (or whether or to what extent the Environmental Defect has been cured or remediated), at the sole option of Purchaser, (i) Sellers shall deliver to Purchaser a written indemnity agreement, in form and substance reasonable satisfactory to Purchaser, under which Sellers agree to fully, jointly and severally indemnify Purchaser from any and all losses, costs, expenses, claims and damages (including diminution in value) arising out of, or resulting from, such Environmental Defect (in which case there shall be no reduction in the Purchase Price), provided that such indemnification obligation shall be limited Amount thereof attributable to the Allocated Value for Initial Assets (and if the affect AssetOption is exercised, or (ii) the Option Purchase Price shall be reduced by the Environmental Defect Value Amount thereof attributable to the Option Assets, (ii) submit any disputes with respect thereto to each arbitration pursuant to Section 5.06, or (iii) elect to attempt to cure such Environmental Defect to Buyer’s reasonable satisfaction, on or before the Cure End Date. In the event any Seller elects to proceed under subsection (orii) or (iii) of the foregoing sentence, subject the portion of the Environmental Defect Amount thereof attributable to the Initial Assets shall remain in the Title/Environmental Escrow until the resolution of the arbitration or the Cure End Date, as applicable. Each Seller shall use commercially reasonable efforts to cure any Environmental Defects for which it elects to cure. Buyer agrees to reasonably cooperate with any attempt by a Seller to cure any Environmental Defect. If one or more Sellers elect to cure any such Environmental Defect and are able to do so to Buyer’s reasonable satisfaction on or before the Cure End Date, the Seller Representative and Buyer shall jointly instruct the Escrow Agent to disburse the Environmental Defect Amount for such Environmental Defect from the Title/Environmental Escrow to such Sellers to the extent attributable to the Initial Assets. If one or more Sellers elect to cure any such Environmental Defect and are not able to do so to Buyer’s reasonable satisfaction on or before the Cure End Date, the Seller Representative and Buyer shall jointly instruct the Escrow Agent to disburse the Environmental Defect Amount for such Environmental Defect from the Title/Environmental Escrow to Buyer to the extent attributable to the Initial Assets. If Buyer and one or more Sellers dispute whether Sellers have cured any Environmental Defect to Buyer’s reasonable satisfaction, such dispute shall be submitted to arbitration under Section 6.55.06. Without duplication of adjustments made pursuant to the last sentence of Section 4.04(a), in the event that the Parties to not agree upon the existence of an Environmental Defect, or the Environmental Defect Value with respect thereto, Purchaser’s estimate of the Environmental Defect), provided that such reduction in the Purchase Price shall not exceed the Allocated Value for the affected Asset. Notwithstanding the foregoing, in the event that the aggregate amount of all Title Defects and Environmental Defects affecting an Asset the Initial Assets asserted prior to the Claim Date exceeds the Allocated Value of such AssetTitle/Environmental Escrow, such Asset shall be removed the from the transactions contemplated by this Agreement and the Option Purchase Price shall be reduced by the Allocated Value of amount by which the AssetsTitle/Environmental Escrow is exceeded, subject or if the Option is not exercised, the Initial Purchase Price shall be reduced by such amount in calculating the Adjusted Initial Purchase Price, pursuant to Section 6.510.01(a).

Remedies for Environmental Defects. (a) Sellers and Purchaser shall attempt to agree on a resolution with respect to any Environmental Defect prior to Closing. Sellers may, at their collective option (and at their sole cost, risk, and expense), attempt to cure such Environmental Defect at any time prior to Closing. For each claim asserted by Purchaser for an Environmental Defect, with respect to which the Parties cannot agree upon the Environmental Defect or the Environmental Defect Value (or whether or to what extent the Environmental Defect has been cured or remediated), at the sole option of Purchaser, (i) Sellers shall deliver to Purchaser a written indemnity agreement, in form and substance reasonable satisfactory to Purchaser, under which Sellers agree to fully, jointly and severally indemnify Purchaser from any and all losses, costs, expenses, claims and damages (including diminution in value) arising out of, or resulting from, such Environmental Defect (in which case there shall be no reduction in the Purchase Price), provided that such indemnification obligation shall be limited to the Allocated Value for the affect Asset, or (ii) the Purchase Price shall be reduced by the Environmental Defect Value with respect to each Environmental Defect (or, subject to Section 6.5, in the event that the Parties to do not agree upon the existence of an Environmental Defect, or the Environmental Defect Value with respect thereto, Purchaser’s estimate of the Environmental Defect), provided that such reduction in the Purchase Price shall not exceed the Allocated Value for the affected Asset. Notwithstanding the foregoing, in the event that the aggregate of all Environmental Defects affecting an Asset exceeds the Allocated Value of such Asset, such Asset shall be removed the from the transactions contemplated by this Agreement and the Purchase Price shall be reduced by the Allocated Value of the Assets, subject to Section 6.5.