Notice of Title Defects Defect Adjustments. (a) To assert a claim arising out of a breach of Section 4.1, Buyer must deliver a claim notice to Seller (each a “Title Defect Notice”) on or before the date which is fifteen (15) Business Days subsequent to the date hereof (the “Title Claim Date”). Such notice shall be in writing and shall include (i) a description of the alleged Title Defect(s) that is reasonably sufficient for Seller to determine the basis of the alleged Title Defect(s), (ii) the Properties adversely affected by the alleged Title Defect(s), (iii) the Allocated Values of the Properties subject to the alleged Title Defect(s), (iv) all documents upon which Buyer relies for its assertion of the alleged Title Defect(s), including, at a minimum, supporting documents reasonably necessary for Seller (as well as any title attorney or examiner hired by Seller or its Affiliates) to verify the existence of the alleged Title Defect(s) and (v) the amount by which Buyer reasonably believes the Allocated Values of those Properties are reduced by the alleged Title Defect(s) and the computations and information upon which Buyer’s belief is based, including any analysis by any title attorney or examiner hired by Buyer. Except in the event of fraud on the part of Seller, Buyer shall be deemed to have waived all breaches of Section 4.1 of which Seller has not been given notice on or before the Title Claim Date; provided that such waiver shall not in any manner affect or diminish Buyer’s rights and remedies with respect to the special warranty of title provided in the Assignments, except to the extent, in order to avoid duplication, that any Title Defect asserted pursuant to this Article IV (i) has been cured by Seller as of Closing or (ii) is the subject of a finally resolved Purchase Price adjustment hereunder. Buyer shall not be entitled to protection under the special warranty of title set forth in the Assignments against any Title Defect for which a Title Defect Notice is furnished pursuant to this Section 4.2(a) or any Title Defect disclosed in writing to Seller by Buyer prior to the Title Claim Date. (b) Should Buyer discover any Title Benefit on or before the Title Claim Date, Buyer shall as soon as practicable, but in any case by the Title Claim Date, deliver to Seller a notice including (i) a description of the Title Benefit that is reasonably sufficient to determine the basis of the alleged Title Benefit, (ii) the Properties affected by the alleged Title Benefit, (iii) the Allocated Values of the Properties subject to such alleged Title Benefit, (iv) all documents upon which Buyer relies for its assertion of the alleged Title Benefit and (v) the amount by which Buyer reasonably believes the Allocated Value of those Properties is increased by the alleged Title Benefit, and the computations and information upon which Buyer’s belief is based, including any analysis by any title attorney or examiner hired by Buyer. Seller shall have the right, but not the obligation, to deliver to Buyer a similar notice on or before the Title Claim Date with respect to each Title Benefit discovered by Seller. Except in the event of fraud on the part of Buyer, Seller shall be deemed to have waived all Title Benefits of which neither Buyer nor Seller has given notice on or before the Title Claim Date. (c) Seller shall have the right, but not the obligation, to attempt, at Seller’s sole cost, to cure or remove on or before the Closing Date any alleged Title Defects for which Seller has received a Title Defect Notice from Buyer prior to the Title Claim Date. If any such Title Defect is not cured by the Closing Date, Seller shall remedy such Title Defect pursuant to Section 4.2(d); provided, however, that if, as of the date five (5) Business Days prior to Closing, Seller and Buyer cannot agree on (i) the proper and adequate cure for any such Title Defect, (ii) the Title Defect Amount or (iii) whether the alleged Title Defect constitutes a Title Defect, such dispute(s) shall be finally and exclusively resolved in accordance with the provisions of Section 4.2(i). An election by Seller to attempt to cure a Title Defect shall be without prejudice to its rights under Section 4.2(i) and shall not constitute an admission against interest or a waiver of Seller’s right to dispute the existence, nature or value of, or cost to cure, the alleged Title Defect. (d) In the event that any Title Defect is not waived by Buyer or, subject to Section 4.2(c), cured prior to the Closing, Seller may, at its sole election, and subject to the Individual Defect Threshold and the Aggregate Defect Deductible, elect to (i) make a downward adjustment to the Purchase Price equal to an amount determined (the “Title Defect Amount”) pursuant to Section 4.2(g) as being the value of such Title Defect or (ii) retain the entirety of the defected Property that is adversely affected by such Title Defect, in which event the Purchase Price shall be adjusted downward, by an amount equal to the Allocated Value of such defected Property and such defected Property shall no longer be included within the definition of Assets for any purpose under this Agreement. (e) With respect to each Property affected by Title Benefits reported under Section 4.2(b), the Purchase Price shall be increased by an amount (the “Title Benefit Amount”) equal to the increase in the Allocated Value for such affected Property, as determined pursuant to Section 4.2(h). (f) Section 4.2(d) shall, to the fullest extent permitted by applicable Law, be the exclusive right and remedy of Buyer with respect to Seller’s breach of its warranty and representation in Section 4.1. In this regard and notwithstanding anything to the contrary in this Agreement, if a Title Defect under this Article IV results from any matter which could also result in the breach of any representation or warranty of Seller as set forth in this Agreement (other than Article IV), then Buyer shall only be entitled to assert such matter prior to the Title Claim Date as a Title Defect to the extent permitted by this Article IV and shall be precluded from also asserting such matter as the basis of the breach of any such representation or warranty. (g) The Title Defect Amount resulting from a Title Defect shall be determined as follows: (i) if Buyer and Seller agree on the Title Defect Amount, that amount shall be the Title Defect Amount; (ii) if the Title Defect is a lien, encumbrance or other charge which is undisputed and liquidated in amount, then the Title Defect Amount shall be the amount necessary to be paid to remove the Title Defect from Seller’s interest in the affected Property; (iii) if the Title Defect represents a discrepancy between (A) the Net Revenue Interest for any Well and (B) the Net Revenue Interest or percentage stated on Exhibit B, then the Title Defect Amount shall be the product of the Allocated Value of such Well multiplied by a fraction, the numerator of which is the Net Revenue Interest or percentage ownership decrease and the denominator of which is the Net Revenue Interest or percentage ownership stated on Exhibit B; provided that if the Title Defect does not affect the Well throughout its entire productive life, then the Title Defect Amount determined under this Section 4.2(g)(iii) shall be reduced to take into account the applicable time period only; (iv) if the Title Defect represents an obligation, encumbrance, burden or charge upon or other defect in title to the affected Property of a type not described in subsections (i), (ii) or (iii) above, the Title Defect Amount shall be determined by taking into account the Allocated Value of the Property so affected, the portion of the Lease or Well affected by the Title Defect, the legal effect of the Title Defect, the potential economic effect of the Title Defect over the life of the affected Lease or Well, the values placed on the Title Defect by Buyer and Seller and such other factors as are necessary to make a proper evaluation; (v) notwithstanding anything to the contrary in this Article IV, the aggregate Title Defect Amounts attributable to the effects of all Title Defects on any given Lease or Well shall not exceed the Allocated Value of such Lease or Well; (vi) if a Title Defect is reasonably susceptible of being cured, then the Title Defect Amount determined under subsections (iii) or (iv) above shall not be greater than the amount that can reasonably be shown to be the reasonable cost and expense of curing such Title Defect; and (vii) the Title Defect Amount with respect to a Title Defect shall be determined without duplication of any costs or losses included in another Title Defect Amount hereunder, or for which Buyer otherwise receives credit in the calculation of the Adjusted Purchase Price. (h) The Title Benefit Amount for any Title Benefit shall be the product of the Allocated Value of the affected Property multiplied by a fraction, the numerator of which is the Net Revenue Interest increase and the denominator of which is the Net Revenue Interest stated on Exhibit B; provided that if the Title Benefit does not pertain to the Lease or Well throughout its entire productive life, then the Title Benefit Amount determined under this Section 4.2(h) shall be reduced to take into account the applicable time period only. (i) Seller and Buyer shall attempt to agree on all Title Defects and Title Defect Amounts and Title Benefits and Title Benefit Amounts by five (5) Business Days prior to the Closing Date. If Seller and Buyer are unable to agree by that date, Seller’s estimate shall be used to determine the Adjusted Purchase Price to be paid at Closing, and the Title Defect and Title Defect Amounts, Title Benefit and Title Benefit Amounts in dispute, and only such disputes, shall be exclusively and finally resolved by arbitration pursuant to this Section 4.2(i). During the 10-day period following the Closing Date, Buyer and Seller shall submit any Title Defects and Title Defect Amounts and any Title Benefits and Title Benefit Amounts in dispute to a title attorney with at least 15 years of experience in oil and gas titles in the State of Texas as selected by mutual agreement of Buyer and Seller, or absent such agreement during the 10-day period, by the Houston office of the American Arbitration Association (the “Title Arbitrator”). The arbitration proceeding shall be held in Houston, Texas and shall be conducted in accordance with the Commercial Arbitration Rules of the American Arbitration Association, to the extent such rules do not conflict with the terms of this Section. The Title Arbitrator’s determination shall be made within 45 days after submission of the matters in dispute and shall be final and binding upon the parties hereto, without right of appeal. In making his determination, the Title Arbitrator shall be bound by the rules set forth in Section 4.2(g) and Section 4.2(h) and may consider such other matters as in the opinion of the Title Arbitrator are necessary or helpful to make a proper determination. Additionally, the Title Arbitrator may consult with and engage disinterested Third Parties, including title attorneys from other states and petroleum engineers, to advise the Title Arbitrator, but shall disclose to the Parties the identities of such consultants. Any such consultant shall not have worked as an employee or consultant for any party hereto or its Affiliates during the five (5) year period preceding the arbitration nor have any financial interest in the dispute. The Title Arbitrator shall act as an expert for the limited purpose of determining the specific disputed Title Defect and Title Defect Amounts, Title Benefit and Title Benefit Amounts submitted by Buyer or Seller and may not award damages, interest or penalties with respect to any matter. Seller, on the one hand, and Buyer, on the other, each shall bear its own legal fees and other costs of presenting its case. Buyer shall bear one-half of the costs and expenses of the Title Arbitrator, and Seller shall be responsible for the remaining one-half of such costs and expenses. (j) Notwithstanding anything to the contrary in this Agreement, in no event shall there be any adjustments to the Purchase Price or other remedies available in respect of Title Defects or Title Benefits, as applicable: (i) With respect to Title Defects, (A) for any Title Defect Amount with respect to an individual Title Defect Property, if such amount does not exceed $50,000 (each, an “Individual Defect Threshold”); and (B) unless the amount of all such Title Defect Amounts (provided that each such Title Defect Amount exceeds the Individual Defect Threshold), in the aggregate (excluding any Title Defect Amounts with respect to Title Defects cured by Seller in accordance with this Article IV) exceeds three quarters of one percent (0.75%) of the Purchase Price (adjusted for any Preference Rights Assets, in an amount equal to the Allocated Value of such Preference Rights Assets less any purchase price adjustments agreed to between Seller and Third Party with respect to the sale of such Preference Rights Assets, excluded from this transaction pursuant to Section 13.3(c)) (the “Aggregate Defect Deductible”), after which point, subject to the Individual Defect Threshold, Buyer shall be entitled to adjustments to the Purchase Price or other remedies elected by Seller in accordance with Section 4.2(d) only with respect to Title Defect Amounts in excess of such Aggregate Defect Deductible and only to the extent that Title Defect Amounts exceed the Aggregate Defect Deductible. (ii) With respect to Title Benefits, (A) for any Title Benefit Amount with respect to an individual Title Benefit Property, if such amount does not exceed $50,000 (each, an “Individual Benefit Threshold”); and (B) unless the aggregate amount of all such Title Benefit Amounts (provided that each such Title Benefit Amount exceeds the Individual Benefit Threshold), in the aggregate exceeds three quarters of one percent (0.75%) of the Purchase Price (adjusted for any Preference Rights Assets, in an amount equal to the Allocated Value of such Preference Rights Assets less any purchase price adjustments agreed to between Seller and Third Party with respect to the sale of such Preference Rights Assets, excluded from this transaction pursuant to Section 13.3(c)) (the “Aggregate Benefit Deductible”), after which point, subject to the Individual Benefit Threshold, Seller shall be entitled to adjustments to the Purchase Price only with respect to Title Benefit Amounts in excess of such Aggregate Benefit Deductible and only to the extent that Title Benefit Amounts exceed the Aggregate Benefit Deductible.
Appears in 1 contract
Notice of Title Defects Defect Adjustments. (a) To assert a claim arising out of a breach of Section 4.1, Title Defect Notices. Buyer must deliver a claim notice to Seller no later than 5:00 p.m. (each a “Title Defect Notice”Central Time) on or before the date which is fifteen (15) Business Days subsequent to the date hereof November 10, 2021 (the “Title Claim Date”) claim notices to Seller meeting the requirements of this Section 11.02(a) (each such notice a “Title Defect Notice” and, collectively, the “Title Defect Notices”) setting forth any matters which, in Buyer’s good faith opinion, constitute Title Defects and which Buyer intends to assert as a Title Defect pursuant to this Section 11.02(a). Such notice shall For all purposes of this Agreement and notwithstanding anything in this Agreement to the contrary (except as provided in Section 11.01), Buyer will be deemed to have waived, and Seller will have no Liability for, any Title Defect which Buyer fails to assert as a Title Defect by a properly delivered Title Defect Notice received by Seller on or before the Title Claim Date. To be effective, each Title Defect Notice must be in writing and shall include must include: (i) a description of the alleged Title Defect(s) that is reasonably sufficient for Seller to determine Defect and the basis of the Lease or Well, or portion thereof, affected by such Title Defect (each, whether affected by an actual or alleged Title Defect(sDefect, a “Title Defect Property”), (ii) the Properties adversely affected by the alleged Allocated Value of each Title Defect(s)Defect Property, (iii) the Allocated Values of the Properties subject Reasonable Documentation to the alleged Title Defect(s), (iv) all documents upon which Buyer relies for its assertion of the alleged Title Defect(s), including, at a minimum, supporting documents reasonably necessary for Seller (as well as any title attorney or examiner hired by enable Seller or its Affiliates) the Title Arbitrator to verify the existence of the such alleged Title Defect(s) Defect, and (viv) Buyer’s good faith calculation of the amount by which Buyer reasonably believes Title Defect Amount with respect to each Title Defect Property, in each case, determined in accordance with Section 11.02(g) (the Allocated Values of those Properties are reduced by the alleged “Alleged Title Defect(sDefect Amount”) and the computations and information upon which Buyer’s belief is based, including any analysis by any title attorney or examiner hired by Buyer. Except in the event of fraud on the part of SellerTo give Seller an opportunity to commence reviewing and curing Title Defects, Buyer shall be deemed use reasonable efforts, but shall not have the obligation, to have waived all breaches of Section 4.1 of which Seller has not been given notice give Seller, on or before the end of each calendar week prior to the Title Claim Date; provided that such waiver shall not in any manner affect or diminish Buyer’s rights and remedies with respect to the special warranty , written notice of title provided in the Assignments, except to the extent, in order to avoid duplication, that any all alleged Title Defect asserted pursuant to this Article IV (i) has been cured by Seller as of Closing or (ii) is the subject of a finally resolved Purchase Price adjustment hereunder. Buyer shall not be entitled to protection under the special warranty of title set forth in the Assignments against any Title Defect for which a Title Defect Notice is furnished pursuant to this Section 4.2(a) or any Title Defect disclosed in writing to Seller Defects discovered by Buyer during the preceding calendar week, which notice may be preliminary in nature and supplemented prior to the Title Claim Date.
(b) Should Buyer discover any Title Benefit on or before the Title Claim Date, Buyer shall as soon as practicable, but in any case by the Title Claim Date, deliver to Seller a notice including (i) a description of the Title Benefit that is reasonably sufficient to determine the basis of the alleged Title Benefit, (ii) the Properties affected by the alleged Title Benefit, (iii) the Allocated Values of the Properties subject to such alleged Title Benefit, (iv) all documents upon which Buyer relies for its assertion of the alleged Title Benefit and (v) the amount by which Buyer reasonably believes the Allocated Value of those Properties is increased by the alleged Title Benefit, and the computations and information upon which Buyer’s belief is based, including any analysis by any title attorney or examiner hired by Buyer. Seller shall have the right, but not the obligation, to deliver to Buyer a similar notice on or before the Title Claim Date with respect to each Title Benefit discovered by Seller. Except in the event of fraud on the part of Buyer, Seller shall be deemed to have waived all Title Benefits of which neither Buyer nor Seller has given notice on or before the Title Claim Date.
(c) Seller shall have the right, but not the obligation, to attempt, at Seller’s sole cost, to cure or remove on or before the Closing Date any alleged Title Defects for which Seller has received a Title Defect Notice from Buyer prior to the Title Claim Date. If any such Title Defect is not cured by the Closing Date, Seller shall remedy such Title Defect pursuant to Section 4.2(d); provided, however, that if, as of the date five (5) Business Days prior to Closing, Seller and Buyer cannot agree on (i) the proper and adequate cure for any such Title Defect, (ii) the Title Defect Amount or (iii) whether the alleged Title Defect constitutes a Title Defect, such dispute(s) shall be finally and exclusively resolved in accordance with the provisions of Section 4.2(i). An election by Seller to attempt to cure a Title Defect shall be without prejudice to its rights under Section 4.2(i) and shall not constitute an admission against interest or a waiver of Seller’s right to dispute the existence, nature or value of, or cost to cure, the alleged Title Defect.
(d) In the event that any Title Defect is not waived by Buyer or, subject to Section 4.2(c), cured prior to the Closing, Seller may, at its sole election, and subject to the Individual Defect Threshold and the Aggregate Defect Deductible, elect to (i) make a downward adjustment to the Purchase Price equal to an amount determined (the “Title Defect Amount”) pursuant to Section 4.2(g) as being the value of such Title Defect or (ii) retain the entirety of the defected Property that is adversely affected by such Title Defect, in which event the Purchase Price shall be adjusted downward, by an amount equal to the Allocated Value of such defected Property and such defected Property shall no longer be included within the definition of Assets for any purpose under this Agreement.
(e) With respect to each Property affected by Title Benefits reported under Section 4.2(b), the Purchase Price shall be increased by an amount (the “Title Benefit Amount”) equal to the increase in the Allocated Value for such affected Property, as determined pursuant to Section 4.2(h).
(f) Section 4.2(d) shall, to the fullest extent permitted by applicable Law, be the exclusive right and remedy of Buyer with respect to Seller’s breach of its warranty and representation in Section 4.1. In this regard and notwithstanding anything to the contrary in this Agreement, if a Title Defect under this Article IV results from any matter which could also result in the breach of any representation or warranty of Seller as set forth in this Agreement (other than Article IV), then Buyer shall only be entitled to assert such matter prior to the Title Claim Date as a Title Defect to the extent permitted by this Article IV and shall be precluded from also asserting such matter as the basis of the breach of any such representation or warranty.
(g) The Title Defect Amount resulting from a Title Defect shall be determined as follows:
(i) if Buyer and Seller agree on the Title Defect Amount, that amount shall be the Title Defect Amount;
(ii) if the Title Defect is a lien, encumbrance or other charge which is undisputed and liquidated in amount, then the Title Defect Amount shall be the amount necessary to be paid to remove the Title Defect from Seller’s interest in the affected Property;
(iii) if the Title Defect represents a discrepancy between (A) the Net Revenue Interest for any Well and (B) the Net Revenue Interest or percentage stated on Exhibit B, then the Title Defect Amount shall be the product of the Allocated Value of such Well multiplied by a fraction, the numerator of which is the Net Revenue Interest or percentage ownership decrease and the denominator of which is the Net Revenue Interest or percentage ownership stated on Exhibit B; provided that if the Title Defect does not affect the Well throughout its entire productive life, then the Title Defect Amount determined under this Section 4.2(g)(iii) shall be reduced to take into account the applicable time period only;
(iv) if the Title Defect represents an obligation, encumbrance, burden or charge upon or other defect in title to the affected Property of a type not described in subsections (i), (ii) or (iii) above, the Title Defect Amount shall be determined by taking into account the Allocated Value of the Property so affected, the portion of the Lease or Well affected by the Title Defect, the legal effect of the Title Defect, the potential economic effect of the Title Defect over the life of the affected Lease or Well, the values placed on the Title Defect by Buyer and Seller and such other factors as are necessary to make a proper evaluation;
(v) notwithstanding anything to the contrary in this Article IV, the aggregate Title Defect Amounts attributable to the effects of all Title Defects on any given Lease or Well shall not exceed the Allocated Value of such Lease or Well;
(vi) if a Title Defect is reasonably susceptible of being cured, then the Title Defect Amount determined under subsections (iii) or (iv) above shall not be greater than the amount that can reasonably be shown to be the reasonable cost and expense of curing such Title Defect; and
(vii) the Title Defect Amount with respect to a Title Defect shall be determined without duplication of any costs or losses included in another Title Defect Amount hereunder, or for which Buyer otherwise receives credit in the calculation of the Adjusted Purchase Price.
(h) The Title Benefit Amount for any Title Benefit shall be the product of the Allocated Value of the affected Property multiplied by a fraction, the numerator of which is the Net Revenue Interest increase and the denominator of which is the Net Revenue Interest stated on Exhibit B; provided that if the Title Benefit does not pertain to the Lease or Well throughout its entire productive life, then the Title Benefit Amount determined under this Section 4.2(h) shall be reduced to take into account the applicable time period only.
(i) Seller and Buyer shall attempt to agree on all Title Defects and Title Defect Amounts and Title Benefits and Title Benefit Amounts by five (5) Business Days prior to the Closing Date. If Seller and Buyer are unable to agree by that date, Seller’s estimate shall be used to determine the Adjusted Purchase Price to be paid at Closing, and the Title Defect and Title Defect Amounts, Title Benefit and Title Benefit Amounts in dispute, and only such disputes, shall be exclusively and finally resolved by arbitration pursuant to this Section 4.2(i). During the 10-day period following the Closing Date, Buyer and Seller shall submit any Title Defects and Title Defect Amounts and any Title Benefits and Title Benefit Amounts in dispute to a title attorney with at least 15 years of experience in oil and gas titles in the State of Texas as selected by mutual agreement of Buyer and Seller, or absent such agreement during the 10-day period, by the Houston office of the American Arbitration Association (the “Title Arbitrator”). The arbitration proceeding shall be held in Houston, Texas and shall be conducted in accordance with the Commercial Arbitration Rules of the American Arbitration Association, to the extent such rules do not conflict with the terms of this Section. The Title Arbitrator’s determination shall be made within 45 days after submission of the matters in dispute and shall be final and binding upon the parties hereto, without right of appeal. In making his determination, the Title Arbitrator shall be bound by the rules set forth in Section 4.2(g) and Section 4.2(h) and may consider such other matters as in the opinion of the Title Arbitrator are necessary or helpful to make a proper determination. Additionally, the Title Arbitrator may consult with and engage disinterested Third Parties, including title attorneys from other states and petroleum engineers, to advise the Title Arbitrator, but shall disclose to the Parties the identities of such consultants. Any such consultant shall not have worked as an employee or consultant for any party hereto or its Affiliates during the five (5) year period preceding the arbitration nor have any financial interest in the dispute. The Title Arbitrator shall act as an expert for the limited purpose of determining the specific disputed Title Defect and Title Defect Amounts, Title Benefit and Title Benefit Amounts submitted by Buyer or Seller and may not award damages, interest or penalties with respect to any matter. Seller, on the one hand, and Buyer, on the other, each shall bear its own legal fees and other costs of presenting its case. Buyer shall bear one-half of the costs and expenses of the Title Arbitrator, and Seller shall be responsible for the remaining one-half of such costs and expenses.
(j) Notwithstanding anything to the contrary in this Agreement, in no event shall there be any adjustments to the Purchase Price or other remedies available in respect of Title Defects or Title Benefits, as applicable:
(i) With respect to Title Defects, (A) for any Title Defect Amount with respect to an individual Title Defect Property, if such amount does not exceed $50,000 (each, an “Individual Defect Threshold”); and (B) unless the amount of all such Title Defect Amounts (provided that each such Title Defect Amount exceeds the Individual Defect Threshold), in the aggregate (excluding any Title Defect Amounts with respect to Title Defects cured by Seller in accordance with this Article IV) exceeds three quarters of one percent (0.75%) of the Purchase Price (adjusted for any Preference Rights Assets, in an amount equal to the Allocated Value of such Preference Rights Assets less any purchase price adjustments agreed to between Seller and Third Party with respect to the sale of such Preference Rights Assets, excluded from this transaction pursuant to Section 13.3(c)) (the “Aggregate Defect Deductible”), after which point, subject to the Individual Defect Threshold, Buyer shall be entitled to adjustments to the Purchase Price or other remedies elected by Seller in accordance with Section 4.2(d) only with respect to Title Defect Amounts in excess of such Aggregate Defect Deductible and only to the extent that Title Defect Amounts exceed the Aggregate Defect Deductible.
(ii) With respect to Title Benefits, (A) for any Title Benefit Amount with respect to an individual Title Benefit Property, if such amount does not exceed $50,000 (each, an “Individual Benefit Threshold”); and (B) unless the aggregate amount of all such Title Benefit Amounts (provided that each such Title Benefit Amount exceeds the Individual Benefit Threshold), in the aggregate exceeds three quarters of one percent (0.75%) of the Purchase Price (adjusted for any Preference Rights Assets, in an amount equal to the Allocated Value of such Preference Rights Assets less any purchase price adjustments agreed to between Seller and Third Party with respect to the sale of such Preference Rights Assets, excluded from this transaction pursuant to Section 13.3(c)) (the “Aggregate Benefit Deductible”), after which point, subject to the Individual Benefit Threshold, Seller shall be entitled to adjustments to the Purchase Price only with respect to Title Benefit Amounts in excess of such Aggregate Benefit Deductible and only to the extent that Title Benefit Amounts exceed the Aggregate Benefit Deductible.
Appears in 1 contract
Sources: Purchase and Sale Agreement (Silverbow Resources, Inc.)