THE NET REVENUE INTEREST OR WORKING INTEREST AND ANY SUPPORTING DOCUMENTS),
(IV) IDENTIFY THE SPECIFIC PROPERTIES (INCLUDING THE SPECIFIC WARRANTY WELLS,
LEASES OR UNITS LISTED ON BUYER SCHEDULE 8.1(F)(3) TO WHICH SUCH TITLE DEFECT
RELATES, AND (V) INCLUDE THE VALUE OF SUCH TITLE DEFECT AS DETERMINED BY BUYER
IN GOOD FAITH.
(D)
BUYER SCHEDULE 8.1(D) SETS FORTH A LIST OF THE PROPERTIES EXAMINED
BY BUYER AS OF THE DATE HEREOF, AND THE TITLE DEFECTS, IF ANY, ASSOCIATED WITH
SUCH PROPERTIES. BUYER WILL UPDATE BUYER SCHEDULE 8.1(D) AT CLOSING, WITH:
(I) A LIST OF ALL PROPERTIES THE TITLE TO WHICH BUYER HAS EXAMINED AS OF CLOSING
AND THE TITLE DEFECTS, IF ANY, ASSOCIATED THEREWITH; AND (II) A LIST OF
DRILL-SITE PROPERTIES FOR WHICH TITLE OPINIONS HAVE NOT BEEN OBTAINED AT LEAST
FIVE BUSINESS DAYS PRIOR TO THE CLOSING DATE (THE "CLOSING DRILL-SITE
PROPERTIES"). FOLLOWING THE DATE OF THIS AGREEMENT, BUYER MAY NOT PRESENT
FURTHER TITLE DEFECT NOTICES WITH RESPECT TO THE PROPERTIES SET FORTH ON BUYER
SCHEDULE 8.1(D) AS OF THE DATE HEREOF. AT THE END OF THE EXAMINATION PERIOD, ANY
MATTERS THAT MAY OTHERWISE CONSTITUTE A TITLE DEFECT, BUT OF WHICH PFC HAS NOT
BEEN SPECIFICALLY NOTIFIED BY BUYER IN ACCORDANCE WITH THE FOREGOING, SHALL BE
DEEMED TO HAVE BEEN WAIVED BY BUYER FOR ALL PURPOSES. NOTWITHSTANDING THE END OF
THE EXAMINATION PERIOD, BUYER MAY CONTINUE TO PRESENT TITLE DEFECT NOTICES WITH
RESPECT TO THE CLOSING DRILL-SITE PROPERTIES UNTIL 5:00 P.M. DALLAS, TEXAS, TIME
ON THE DATE THAT IS 30 DAYS FOLLOWING THE CLOSING DATE.
55
(E)
UPON THE RECEIPT OF AN EFFECTIVE TITLE DEFECT NOTICE FROM BUYER,
PFC WILL HAVE THE OPTION, BUT NOT THE OBLIGATION, TO ATTEMPT TO CURE SUCH TITLE
DEFECT DURING THE CURE PERIOD (AS HEREAFTER DEFINED) AT PFC'S SOLE COST AND
EXPENSE, AND THE FURTHER OPTION DESCRIBED IN SECTION 8.1(G). A PROPERTY AFFECTED
BY SUCH TITLE DEFECT SHALL BE A "TITLE DEFECT PROPERTY".
(F)
AS USED IN THIS SECTION 8.1:
(1)
"DEFENSIBLE TITLE" MEANS, AS OF THE DATE OF THIS AGREEMENT AND THE
CLOSING DATE,
(A)
WITH RESPECT TO THE WARRANTY WELLS AND LEASES DESCRIBED ON COMPANY
SCHEDULE 4.19 AND WITH RESPECT TO ANY OTHER REAL PROPERTY (INCLUDING THE
EASEMENTS BUT EXCLUDING ANY PORTION OF THE MIDSTREAM ASSETS) INCLUDED IN THE
PROPERTIES, SUCH RECORD TITLE AND OWNERSHIP BY THE COMPANY OR A SUBSIDIARY THAT:
(I)
ENTITLES THE COMPANY AND/OR A SUBSIDIARY TO RECEIVE AND RETAIN
FROM SUCH WARRANTY WELL OR LEASE, WITHOUT REDUCTION, SUSPENSION OR TERMINATION,
NOT LESS THAN THE PERCENTAGE SET FORTH ON COMPANY SCHEDULE 4.19 AS THE NET
REVENUE INTEREST OF ALL HYDROCARBONS PRODUCED, SAVED AND MARKETED FROM SUCH
WARRANTY WELL OR LEASE;
(II)
OBLIGATES THE COMPANY AND/OR A SUBSIDIARY TO BEAR A PERCENTAGE OF
THE COSTS AND EXPENSES RELATING TO THE MAINTENANCE, DEVELOPMENT AND OPERATION OF
SUCH WARRANTY WELL OR LEASE THAT IS NOT MORE THAN THE WORKING INTEREST SET FORTH
FOR SUCH WARRANTY WELL OR LEASE ON COMPANY SCHEDULE 4.19, (UNLESS SUCH INCREASE
IS ACCOMPANIED BY A PROPORTIONATE INCREASE IN