DIRECTED AT PROTECTING HUMAN
HEALTH AND THE ENVIRONMENT, SUCH AS (BY WAY OF EXAMPLE AND NOT LIMITATION AND
INCLUDING ALL AMENDMENTS) THE COMPREHENSIVE ENVIRONMENTAL RESPONSE, COMPENSATION
AND LIABILITY ACT OF 1980, THE RESOURCE CONSERVATION AND RECOVERY ACT OF 1976,
THE CLEAN WATER ACT, THE SAFE DRINKING WATER ACT, THE HAZARDOUS MATERIALS
TRANSPORTATION ACT, THE TOXIC SUBSTANCES CONTROL ACT, AND THE CLEAN AIR ACT.
(2) FARMEE ACKNOWLEDGES THAT THE LAND SUBJECT TO THIS AGREEMENT MAY HAVE BEEN
USED FOR OIL AND GAS OPERATIONS IN THE PAST. FARMEE AGREES THAT ANY CONVEYANCE
OF INTERESTS HEREUNDER SHALL BE ON AN "AS IS" BASIS.
(3) FARMEE SHALL RELEASE, DEFEND, INDEMNIFY AND HOLD FARMOR HARMLESS FROM ANY
AND ALL DAMAGES, EXPENSES (INCLUDING COURT COSTS AND ATTORNEY'S FEES), CIVIL
FINES, PENALTIES AND OTHER COSTS AND LIABILITIES (HEREINAFTER COLLECTIVELY
REFERRED TO AS "CLAIMS") ARISING, ASSERTED, COMMENCED OR MADE ON OR AFTER THE
EFFECTIVE DATE OF THIS AGREEMENT THAT RESULT FROM FARMEE'S ACTS AND OMISSIONS
(OR THOSE OF OTHER PARTIES ON YOUR BEHALF) IN CARRYING OUT OPERATIONS UNDER THIS
AGREEMENT AND/OR ON LEASES CONVEYED UNDER THIS AGREEMENT. THE ABOVE CLAIMS SHALL
INCLUDE, BUT NOT BE LIMITED TO, THOSE ASSERTED OR BROUGHT BY ANY PARTY
(INCLUDING, WITHOUT LIMITATION, FARMEE'S OR FARMOR'S, CONTRACTORS, ANY
LANDOWNERS OR INDIVIDUALS, LOCAL, STATE OR FEDERAL GOVERNMENTAL BODY OR AGENCY)
FOR DEATH, PERSONAL INJURY, DAMAGE TO PROPERTY OR NATURAL RESOURCES, AND/OR
FAILURE TO COMPLY WITH THE EXPRESS OR IMPLIED TERMS OF A MINERAL LEASE. SUCH
CLAIMS SHALL ALSO INCLUDE ANY THAT ARISE OUT OF THE PLUGGING AND ABANDONING OR
FAILURE TO PLUG AND ABANDON ANY WELLS ON OR IN LANDS COVERED HEREBY (WHETHER
PLUGGED AND ABANDONED PRIOR TO OR AFTER THE EFFECTIVE DATE OF THIS AGREEMENT) OR
ARISING OUT OF THE REMOVAL OF OR FAILURE TO REMOVE ANY PIPELINE OR OTHER
FACILITIES, OR ON ACCOUNT OF THE PRESENCE, DISPOSAL, AND/OR RELEASE OF ANY
MATERIAL OF ANY KIND IN, ON OR UNDER THE LANDS COVERED HEREBY (WHETHER OR NOT
SUCH MATERIAL WAS PRESENT PRIOR TO THE EFFECTIVE DATE OF THIS AGREEMENT).
THE TERMS OF THIS PROVISION (3) SHALL APPLY NOTWITHSTANDING THE STRICT
LIABILITY, JOINT NEGLIGENCE OR FAULT OF FARMOR OR ANY PARTY OR PARTIES. THE
PROVISIONS SET FORTH IN THIS ARTICLE VII. SHALL SURVIVE TERMINATION OF THIS
AGREEMENT.
VIII. FAILURE TO PERFORM
A. Operations. In addition to the rights granted to FARMOR in other provisions
of this Agreement, in the event of FARMEE'S failure to commence or complete the
drilling of the Initial Well or any Additional Well in the time and manner
herein provided, this Agreement shall terminate as to all of the Farmout Area
not previously earned by FARMEE; however, FARMEE shall continue to be
responsible for all obligations accrued by FARMEE prior to such default.
B. Notice of Termination. FARMOR will give FARMEE written notice of termination,
however in the event FARMEE fails to commence the drilling of the Initial Well
or any Additional Well, termination will occur automatically and no such notice
will be required to effectuate the termination of FARMEE'S rights