Common use of Effective Time and Date Clause in Contracts

Effective Time and Date. The purchase and sale of the Assets shall become effective at 7:00 a.m. on October 1, 2010. Revenues and expenses shall be prorated as of the Effective Date; provided, however, that the rights to any amounts withheld from previous production proceeds for the purpose of paying then unpaid ad valorem taxes for 2009 production assessed in 2010 (due in 2011) or for 2010 production assessed in 2010 (due in 2012) will be assigned to Synergy at Closing. If any purchaser of production has not withheld any amounts from 2009 production proceeds for the purpose of paying ad valorem taxes assessed in 2010 (due in 2011) or for 2010 production assessed in 2011 (due in 2011), then (i) the actual amount necessary to pay the then unpaid 2009 and 2010 ad valorem taxes and (ii) the estimated amount that should have been withheld based upon pre-Effective Date production for 2009 and 2010 ad valorem taxes (at the rate indicated by Weld County, being an approximately 9% rate) will be determined, and both amounts will be credited to Synergy at closing. The assignment of, and credit for, these amounts shall serve as a final settlement for ad valorem taxes. PEM shall pay all severance taxes on production obtained from the Assets prior to the Effective Date and Synergy shall pay all severance taxes on production obtained from the Assets after the Effective Date.