Common use of FAILURE TO TIMELY PERFORM Clause in Contracts

FAILURE TO TIMELY PERFORM. A significant portion of the consideration for the assignment of Leasehold Assets provided for above in Article 1.01 is the development by EXXI of said Leasehold Assets and each Prospect through drilling operations. Except as provided for below in this Section 5.05, on a Prospect-by-Prospect basis, each Initial Prospect Well must be commenced by EXXI on or before its respective Commencement Date as set forth on Exhibits “H-l” through “H-7” in the Notices of Prospect JOA. Should EXXI not timely spud a particular Initial Prospect Well as provided for herein, EXXI shall be deemed to have relinquished to Centurion ab initio all of its rights, titles and interests in and to the Prospect and the Leasehold Assets associated with such Prospect. Centurion shall not be required to reimburse EXXI for any costs EXXI has incurred or obligations accrued prior to such Commencement Date attributable to any and all such Leasehold Assets and Prospects deemed to have been relinquished. The Parties hereby agree that the above relinquishment of title and interest shall be Centurion’s sole remedy for EXXI not participating in one or all of the Prospects. The failure by EXXI to timely spud one Initial Prospect Well shall have no effect on its participation in any other Initial Prospect Well or the Prospect associated therewith. The Parties hereto agree to timely execute whatever documents and assignments are necessary to effect such forfeiture and relinquishment within thirty (30) days after each such Commencement Date for which an Initial Prospect Well is not timely commenced. To avoid the relinquishment penalty provided for above, EXXI will have the express right to substitute any Initial Prospect Well for another by providing Centurion with written notice of such substitution at least ten days prior to any given Commencement Date such that the respective Commencement Dates of each such Initial Prospect Well are revised accordingly.