SHALL BE EQUAL TO THE ALLOCATED VALUE FOR THE RELEVANT ASSET (OR THE WELLS
ASSOCIATED THEREWITH) MULTIPLIED BY THE PERCENTAGE REDUCTION IN SUCH NET REVENUE
INTEREST AS A RESULT OF SUCH TITLE DEFECT OR (B) IF SUCH TITLE DEFECT IS IN THE
NATURE OF A LIEN, THEN THE TITLE DEFECT AMOUNT SHALL EQUAL THE AMOUNT REQUIRED
TO FULLY DISCHARGE SUCH LIEN; AND
7
(II)
IF THE TITLE DEFECT RESULTS FROM ANY
MATTER NOT DESCRIBED IN CLAUSE (A) OR (B) OF SECTION 3.1(C)(I), THE TITLE DEFECT
AMOUNT SHALL BE AN AMOUNT EQUAL TO THE DIFFERENCE BETWEEN THE VALUE OF THE TITLE
DEFECT ASSET AFFECTED BY SUCH TITLE DEFECT WITH SUCH TITLE DEFECT AND THE VALUE
OF SUCH TITLE DEFECT ASSET WITHOUT SUCH TITLE DEFECT (TAKING INTO ACCOUNT THE
ALLOCATED VALUE OF THE TITLE DEFECT ASSET); AND
(III)
IF THE TITLE DEFECT ASSET HAS NOT BEEN
SEPARATELY ALLOCATED AN ALLOCATED VALUE, BUT IS PART OF AN ASSET OR GROUP OF
ASSETS WHICH HAS OR HAVE AN ALLOCATED VALUE, THEN THE ALLOCATED VALUE OF SUCH
TITLE DEFECT ASSET SHALL BE A FAIR AND REASONABLE PORTION OF THE ALLOCATED VALUE
OF SUCH ASSET OR GROUP OF ASSETS WHICH HAS OR HAVE AN ALLOCATED VALUE; AND
(IV)
IN NO EVENT SHALL THE TITLE DEFECT AMOUNT
RELATED TO A PARTICULAR ASSET EXCEED THE ALLOCATED VALUE, IF ANY, OF SUCH ASSET;
AND
(V)
THE TITLE DEFECT AMOUNT WITH RESPECT TO A
TITLE DEFECT ASSET SHALL BE DETERMINED WITHOUT DUPLICATION OF ANY COSTS OR
LOSSES INCLUDED IN ANOTHER TITLE DEFECT AMOUNT HEREUNDER.
FOR EXAMPLE, BUT
WITHOUT LIMITATION, IF A LIEN AFFECTS MORE THAN ONE TITLE DEFECT ASSET OR THE
CURATIVE WORK WITH RESPECT TO ONE TITLE DEFECT RESULTS IN THE CURING OF ANY
OTHER TITLE DEFECT AFFECTING THE SAME OR ANOTHER TITLE DEFECT ASSET, THE AMOUNT
NECESSARY TO DISCHARGE SUCH LIEN OR THE COST AND EXPENSE OF SUCH CURATIVE WORK
SHALL BE ALLOCATED AMONG THE TITLE DEFECT ASSETS SO AFFECTED (IN THE RATIOS OF
THE RESPECTIVE PORTIONS OF THE PURCHASE PRICE ALLOCATED TO SUCH TITLE DEFECT
ASSETS) AND THE AMOUNT SO ALLOCATED TO A TITLE DEFECT ASSET SHALL BE INCLUDED
ONLY ONCE IN THE TITLE DEFECT AMOUNT THEREFOR.
(D)
AS USED IN THIS SECTION 3.1:
(I)
"DEFENSIBLE TITLE" MEANS, AS OF THE DATE
OF THIS AGREEMENT AND THE CLOSING DATE WITH RESPECT TO THE ASSETS, SUCH RECORD
TITLE AND OWNERSHIP BY NOBLE THAT: (A) ENTITLES NOBLE TO RECEIVE AND RETAIN,
WITHOUT REDUCTION, SUSPENSION OR TERMINATION, NOT LESS THAN THE PERCENTAGE SET
FORTH IN EXHIBIT "A" OR EXHIBIT "A-1", AS THE CASE MAY BE, AS NOBLE'S NET
REVENUE INTEREST OF ALL HYDROCARBONS PRODUCED, SAVED AND MARKETED FROM EACH
LEASEHOLD INTEREST AND/OR WELL COMPRISING SUCH ASSET AS SET FORTH IN EXHIBIT
"A"OR EXHIBIT "A-1", AS THE CASE MAY BE, THROUGH PLUGGING, ABANDONMENT AND
SALVAGE OF ALL WELLS COMPRISING OR INCLUDED IN SUCH ASSET, AND EXCEPT FOR
CHANGES OR ADJUSTMENTS THAT RESULT FROM THE ESTABLISHMENT OF UNITS, CHANGES IN
EXISTING UNITS (OR THE PARTICIPATING AREAS THEREIN), OR THE ENTRY INTO