ACTUAL KNOWLEDGE ON OR BEFORE THE CLOSING DATE OF SUCH EVENT.
(F)
NOTWITHSTANDING ANYTHING ELSE CONTAINED IN THIS ARTICLE XII,
SELLER HEREBY AGREES TO INDEMNIFY AND HOLD BUYER AND EACH OF ITS AFFILIATES
(INCLUDING THE COMPANY), AND THE OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS
THEREOF, HARMLESS FROM AND AGAINST ANY AND ALL LOSSES ARISING FROM ANY
LITIGATION (I) WHICH ARISES OUT OF ACTIONS, CONDUCT OR EVENTS WHICH OCCUR PRIOR
TO THE EFFECTIVE DATE OR (II) THAT WAS NOT DISCLOSED TO BUYER AND WHICH ARISES
OUT OF ACTIONS, CONDUCT OR EVENTS THAT OCCURRED BETWEEN THE EFFECTIVE DATE AND
THE CLOSING DATE.
THIS INDEMNITY SHALL BE SUBJECT TO THE PROCEDURES OF SECTION
12.3, AND SHALL SURVIVE INDEFINITELY.
ARTICLE XIII
TAXES
13.1
SALES AND USE TAXES; PROPERTY TAXES.
THE PURCHASE PRICE, AS
ADJUSTED HEREIN, IS EXCLUSIVE OF ANY SALES TAXES AND OTHER TRANSFER TAXES IN
CONNECTION WITH THE SALE OF THE MEMBERSHIP INTERESTS.
BUYER SHALL BEAR THE COST
OF ALL APPLICABLE SALES TAXES, REAL PROPERTY TRANSFER TAXES, AND FILING AND
RECORDING FEES PAYABLE AS A RESULT OF THE TRANSFER OF THE MEMBERSHIP INTERESTS.
IF AT ANY TIME AFTER THE CLOSING, SELLER OR ANY AFFILIATE SHALL BECOME LIABLE
FOR TAXES OR
34
FEES FOR WHICH BUYER IS RESPONSIBLE UNDER THIS PARAGRAPH, BUYER SHALL PROMPTLY
REIMBURSE SELLER OR SUCH AFFILIATE FOR SUCH TAXES AND FEES, INCLUDING ANY
PENALTIES AND INTEREST THEREON.
BUYER SHALL DEFEND, INDEMNIFY AND HOLD SELLER
HARMLESS WITH RESPECT TO THE PAYMENT OF ANY SUCH TAXES AND FEES, INCLUDING ANY
INTEREST OR PENALTIES ASSESSED THEREON.
13.2
TAX PROCEEDINGS.
IN THE EVENT SELLER RECEIVES NOTICE OF ANY
PAYMENTS DUE, CLAIM, ADJUSTMENT OR OTHER PROCEEDING RELATING TO REAL OR PERSONAL
PROPERTY TAXES FOR THE YEAR IN WHICH THE EFFECTIVE DATE OCCURS, SELLER SHALL
NOTIFY BUYER IN WRITING WITHIN 30 DAYS OF RECEIVING NOTICE THEREOF.
AS TO ANY
SUCH TAXES BUYER SHALL, AT BUYER'S EXPENSE, CONTROL OR SETTLE THE CONTEST OF
SUCH EXAMINATION, CLAIM, ADJUSTMENT, OR OTHER PROCEEDING, AND SHALL INDEMNIFY
SELLER AGAINST ALL LOSSES, DAMAGES, COSTS, EXPENSES, LIABILITIES, CLAIMS,
DEMANDS, PENALTIES, FINES, ASSESSMENTS, SETTLEMENTS, AND ANY RELATED EXPENSES IN
CONNECTION THEREWITH.
IF, ON EXECUTION OF THIS AGREEMENT, SELLER OR THE COMPANY
IS ACTIVELY DISPUTING ANY REAL OR PERSONAL PROPERTY TAX ASSESSMENTS INVOLVING
THE OIL AND GAS PROPERTIES FOR THE YEAR IN WHICH THE EFFECTIVE DATE OCCURS,
SELLER SHALL FULLY INFORM BUYER OF THE BASIS FOR, AND STATUS OF, THE DISPUTE AND
SHALL PERMIT BUYER TO DIRECT AND/OR PARTICIPATE IN THE DISPUTE TO THE FULL
EXTENT PERMITTED BY LAW.
13.3
REAL AND PERSONAL PROPERTY TAXES.
ALL AD VALOREM TAXES, REAL
PROPERTY TAXES AND PERSONAL PROPERTY TAXES ("REAL AND PERSONAL PROPERTY TAXES")
FOR THE YEAR IN WHICH THE EFFECTIVE DATE OCCURS SHALL BE APPORTIONED AS OF THE
EFFECTIVE DATE BETWEEN SELLER AND BUYER.
SELLER SHALL BE LIABLE FOR THE PORTION
OF SUCH REAL AND PERSONAL PROPERTY TAXES BASED UPON THE NUMBER OF DAYS IN THE
YEAR OCCURRING PRIOR TO THE EFFECTIVE DATE, AND BUYER SHALL BE LIABLE FOR THE
PORTION OF SUCH TAXES BASED UPON THE NUMBER