Common use of Borrowing Base Determinations Clause in Contracts

Borrowing Base Determinations. (a) The initial Borrowing Base is hereby established at $4,000,000.00. (b) The Borrowing Base shall be redetermined by the Lender for each Borrowing Base Period commencing September 1, 2007, and effective as of the date set forth in a notice of redetermination delivered to the Borrower. (c) The determination of the Borrowing Base shall be made, at the sole discretion of the Lender, by reviewing the estimates of the projected rate of production and projected revenues from the Borrowing Base Properties and such other credit factors (including, without limitation, the assets, liabilities, cash flow, current Derivative Contracts, business, properties, prospects, management and ownership of the Borrower) as the Lender in its sole discretion deems significant. The Lender may make adjustments, in good faith and at its sole discretion and in accordance with its customary practices, to such estimates of the projected rate of production and projected revenues. (d) In addition to scheduled Borrowing Base redeterminations pursuant to Subsection 2.6(b), the Lender or the Borrower may cause a redetermination of the Borrowing Base at any one time during each Borrowing Base Period. In the event the Borrower requests such a Borrowing Base redetermination, the Borrower shall deliver written notice of such request to the Lender with (i) a report, in form and substance satisfactory to the Lender, prepared by Scotia Group, Inc. or another independent petroleum engineer or firm of engineers reasonably acceptable to the Lender, which report shall set forth, as of a date not more than sixty (60) calendar days prior to the date of such request, projections of future net income from hydrocarbons classified as "Proved Reserves" attributable to all of the Borrowing Base Properties, (ii) such other information concerning such Oil and Gas Properties as the Lender may reasonably request, including, without limitation, engineering, geological and performance data, and (iii) the amount of the Borrowing Base requested by the Borrower to become effective. Likewise, in the event the Lender exercises its option for a Borrowing Base redetermination pursuant to this Subsection 2.6(d), upon written request and notification by the Lender to the Borrower, the Borrower shall furnish the information described above within thirty (30) days of such request. The Lender shall redetermine the Borrowing Base in accordance with the procedures set forth in Subsection 2.6(c) which redetermined Borrowing Base shall then be the effective Borrowing Base until further redetermination. (e) The Borrower agrees to pay to the Lender an engineering fee of $2,500.00 upon the execution and delivery of this Agreement and upon each redetermination of the Borrowing Base as set forth in Subsections 2.6 (b) and (d).

Borrowing Base Determinations. (a) The initial Borrowing Base as of the Closing Date is hereby established $35,000,000. The Borrowing Base shall be redetermined quarterly on the basis of information supplied by the Related Persons in compliance with the provisions of this Agreement, including, without limitation, Borrowing Base Certificates and Receivable Reports, and all other information then available to Lenders. Notwithstanding the foregoing, Majority Lenders may, in the exercise of their good faith discretion, make redeterminations of the Borrowing Base (i) no more frequently than quarterly on the basis of information then available to Lenders regarding Credit Accounts, and (ii) at $4,000,000.00any time and from time to time upon the occurrence of any event or change having a Material Adverse Effect. (b) The Borrowing Base at any particular date shall be redetermined by the Lender for each Borrowing Base Period commencing September 1, 2007, and effective as of the date that set forth in a the most recent Borrowing Base Certificate submitted to Agent pursuant to subsection 5.2, as such figure may be adjusted or redetermined from time to time by Majority Lenders. Agent shall notify Borrower orally or by facsimile within five Business Days after receipt of the Borrowing Base Certificate (confirming such notice promptly in writing) of redetermination delivered its determination, and the Borrowing Base so communicated to Borrower shall become effective upon such verbal or facsimile notification by Agent to Borrower. Any Borrowing Base established pursuant to this Agreement shall remain in effect until the Borrower. (c) next subsequent determination of the Borrowing Base. The Borrowing Base shall represent the determination by Majority Lenders, in accordance with the applicable definitions and provisions herein contained and with consideration for the nature of the facilities established hereunder, of the value, for loan purposes, of the Eligible Accounts, the Eligible Turnkey Drilling Contracts and the Fleet Value. Furthermore, the Related Persons acknowledge that the determination of the Borrowing Base shall be made, at the sole discretion contains an equity cushion (market value in excess of the Lender, by reviewing the estimates of the projected rate of production and projected revenues from the Borrowing Base Properties and such other credit factors (including, without limitation, the assets, liabilities, cash flow, current Derivative Contracts, business, properties, prospects, management and ownership of the Borrower) as the Lender in its sole discretion deems significant. The Lender may make adjustments, in good faith and at its sole discretion and in accordance with its customary practices, to such estimates of the projected rate of production and projected revenues. (d) In addition to scheduled Borrowing Base redeterminations pursuant to Subsection 2.6(bloan value), the Lender or the Borrower may cause a redetermination of the Borrowing Base at any one time during each Borrowing Base Period. In the event the Borrower requests such a Borrowing Base redetermination, the Borrower shall deliver written notice of such request to the Lender with (i) a report, in form and substance satisfactory to the Lender, prepared by Scotia Group, Inc. or another independent petroleum engineer or firm of engineers reasonably acceptable to the Lender, which report shall set forth, as of a date not more than sixty (60) calendar days prior to the date of such request, projections of future net income from hydrocarbons classified as "Proved Reserves" attributable to all of the Borrowing Base Properties, (ii) such other information concerning such Oil and Gas Properties as the Lender may reasonably request, including, without limitation, engineering, geological and performance data, and (iii) the amount of the Borrowing Base requested is acknowledged by the Borrower Related Persons to become effective. Likewise, in be essential for the event the Lender exercises its option for a Borrowing Base redetermination pursuant to this Subsection 2.6(d), upon written request and notification by the Lender to the Borrower, the Borrower shall furnish the information described above within thirty (30) days adequate protection of such request. The Lender shall redetermine the Borrowing Base in accordance with the procedures set forth in Subsection 2.6(c) which redetermined Borrowing Base shall then be the effective Borrowing Base until further redeterminationBank Parties. (e) The Borrower agrees to pay to the Lender an engineering fee of $2,500.00 upon the execution and delivery of this Agreement and upon each redetermination of the Borrowing Base as set forth in Subsections 2.6 (b) and (d).

Borrowing Base Determinations. (a) The initial Borrowing Base as of the Closing Date is hereby established at agreed by the Borrower and the Lenders to be $4,000,000.00100.0 million. (b) The Borrowing Base shall be redetermined Upon receipt by the Lender for Agent of each Borrowing Base Period commencing September 1Reserve Report described in Section 7.5(a), 2007, the Agent shall make a determination within 25 days of the receipt of such report of the amount of the borrowing base (herein as determined and effective redetermined from time to time and in effect on any date called the "BORROWING BASE") on account of such reserves as of the date set forth in a notice of redetermination delivered preceding January 1, subject to the Borrower. (c) approval of the Applicable Lenders as provided in this Section 2.7(b), and upon such determination the Agent shall promptly notify the Lenders in writing of the determination of the Borrowing Base. The determination of the Borrowing Base made by the Agent shall be madeso made by the Agent in accordance with the Agent's normal and customary practices and standards for oil and gas loans (including consideration for the Borrower's liquidity, at market interest rates, commodity prices, commodity ▇▇▇▇▇▇, permitted Indebtedness, any cash-pay dividend requirements related to Preferred Stock and capital expenditure requirements). The Applicable Lenders may approve the sole discretion Agent's determination of the Lender, by reviewing the estimates of the projected rate of production and projected revenues from the Borrowing Base Properties and by written notice to the Agent within fifteen days of the Agent's notification of its determination of the new Borrowing Base. Any Lender that fails to respond to such other credit factors (includingrecommendation made by the Agent pursuant to this Section 2.7(b) within such fifteen days shall be deemed to have approved such recommendation. If the Applicable Lenders fail to approve a determination of the Borrowing Base made by the Agent pursuant to this Section 2.7(b) within such fifteen days, without limitationthen no later than five days after the end of such fifteen-day period, the assetsLenders shall submit to the Agent in writing, liabilitiesand/or the Agent shall poll the Lenders for, cash flow, current Derivative Contracts, business, properties, prospects, management and ownership of the Borrower) as the Lender in its sole discretion deems significant. The Lender may make adjustments, in good faith and at its sole discretion and their individual recommendations for such redetermined Borrowing Base in accordance with their respective normal and customary practices and standards for oil and gas loans, whereupon the Agent shall designate the Borrowing Base at the largest amount approved by the Applicable Lenders; provided, however, that it is expressly understood that the Lenders and Agent have no obligation to agree upon or designate the Borrowing Base at any particular amount . (c) In addition, upon the receipt by the Agent of each Reserve Report described in Section 7.5(b), the Agent shall make a determination within 25 days of the receipt of such report of the Borrowing Base as of the preceding July 1. The determinations of the Borrowing Base shall be made in the same manner and be subject to the same approvals as prescribed with respect to the annual redetermination as set forth in Section 2.7(c), and likewise the Agent shall communicate the results of each such determination to the Lenders. The Applicable Lenders may approve the determination of the Borrowing Base by written notice to the Agent within fifteen days of the Agent's notification of its customary practices, determination of the new Borrowing Base. Any Lender that fails to respond to such estimates recommendation made by the Agent pursuant to this Section 2.7(c) within such fifteen days shall be deemed to have approved such recommendation. If the Applicable Lenders fail to approve a determination of the projected rate Borrowing Base made by the Agent pursuant to this Section 2.7(c) within such fifteen days, then no later than five days after the end of production such fifteen-day period, the Lenders shall submit to the Agent in writing, and/or the Agent shall poll the Lenders for, their individual recommendations for such redetermined Borrowing Base in accordance with their respective normal and projected revenuescustomary practices and standards for oil and gas loans, whereupon the Agent shall designate the Borrowing Base at the largest amount approved by the Applicable Lenders; provided, however, that it is expressly understood that the Lenders and Agent have no obligation to agree upon or designate the Borrowing Base at any particular amount. (d) In addition, the Agent shall, in the normal course of business following a request of the Borrower, redetermine the Borrowing Base (in the same manner and subject to the same approvals as prescribed in Section 2.7(b) for the redetermination of the Borrowing Base); provided, however, (i) the Agent and the Lenders shall not be obligated to respond to more than one such request during any calendar year in addition to each scheduled Borrowing Base redeterminations pursuant to Subsection 2.6(b)semi-annual redetermination provided for above, the Lender or the Borrower may cause a (ii) no such discretionary redetermination of the Borrowing Base shall be permitted prior to May 1, 2004 and (iii) the Borrower shall have paid to the Agent a $20,000 engineering fee in connection with such requested redetermination of the Borrowing Base, regardless of whether or not such redetermination results in any increase to the Borrowing Base. Notwithstanding the foregoing, the Agent may, at the request of the Applicable Lenders, redetermine the Borrowing Base (in the same manner and subject to the same approvals as prescribed in Section 2.7(b) for the redetermination of the Borrowing Base) at any other time and from time to time; provided, however, the Agent and the Lenders may not redetermine the Borrowing Base under this second sentence of this Section 2.7(d) more than one time during each any calendar year and no discretionary redetermination of the Borrowing Base Period. by the Agent and the Lenders shall be permitted prior to May 1, 2004. (e) [Reserved]. (f) In the event the Borrower requests such a Borrowing Base redetermination, proposes to issue any Preferred Stock which would require the Borrower shall deliver written notice payment of such request to the Lender with (i) a report, in form and substance satisfactory to the Lender, prepared cash dividends by Scotia Group, Inc. or another independent petroleum engineer or firm of engineers reasonably acceptable to the Lender, which report shall set forth, as of a date not more than sixty (60) calendar days prior to the date of such request, projections of future net income from hydrocarbons classified as "Proved Reserves" attributable to all of the Borrowing Base Properties, (ii) such other information concerning such Oil and Gas Properties as the Lender may reasonably request, including, without limitation, engineering, geological and performance data, and (iii) the amount of the Borrowing Base requested by the Borrower to become effective. Likewise, in the event the Lender exercises its option for a Borrowing Base redetermination pursuant to this Subsection 2.6(d), upon written request and notification by the Lender to the Borrower, the Borrower shall furnish provide the information described above within Agent with at least thirty (30) days prior notice of such requestproposed issuance, including detailed information with respect to the amount of the proposed issue, dividend rate, liquidation preference, default rights and other material terms. The Lender shall In such event, the Agent with the approval of the Applicable Lenders may prior to such issuance redetermine the Borrowing Base to take effect upon and subject to consummation of such issuance, taking into account the pro forma effects of such issuance (in accordance with the procedures set forth same manner and subject to the same approvals as prescribed in Subsection 2.6(cSection 2.7(b) which redetermined for the redetermination of the Borrowing Base Base); provided, however, any such redetermination shall then not be the effective Borrowing Base until further considered a "discretionary redetermination. (e) " under Section 2.7(d). The Borrower agrees to pay to the Lender an Agent a $20,000 engineering fee of $2,500.00 upon the execution and delivery of this Agreement and upon each in connection with such requested redetermination of the Borrowing Base as set forth Base, regardless of whether or not such redetermination results in Subsections 2.6 any change to the Borrowing Base. (bg) The Agent shall, on behalf of all Lender Parties, release any and (dall Mortgages and related Liens covering or relating to Oil and Gas Properties upon any sale, transfer, conveyance or other disposition permitted by Section 8.5(c); provided, however, that no release of any Mortgages shall be required if any mandatory prepayment required pursuant to Section 3.1(b) has not been made by the Borrower prior to or substantially contemporaneously therewith; and provided further that, notwithstanding the foregoing, this Section 2.7(g) will not obviate any requirement of the Borrower to provide additional Collateral pursuant to Section 7.19.

Borrowing Base Determinations. (a) The initial Borrowing Base is hereby established at $4,000,000.006,800,000.00. (b) The Borrowing Base shall be redetermined by the Lender for Administrative Agent at the commencement of each Borrowing Base Period commencing September 1Period, 2007, and effective as of the date set forth in a notice of redetermination delivered to the BorrowerBorrower and the Lenders by the Administrative Agent. (c) The Each determination of the Borrowing Base shall be made, at in the sole discretion of the LenderAdministrative Agent, by reviewing the estimates of the projected rate of production and projected revenues from the Borrowing Base Mortgaged Properties and such other credit factors (including, without limitation, the assets, liabilities, cash flow, current Derivative Contracts, business, properties, prospects, management and ownership of the Borrower) as the Lender Administrative Agent in its sole discretion deems significant. The Lender Administrative Agent may make adjustments, in good faith and at its sole discretion and in accordance with its customary practices, to such estimates of the projected rate of production and projected revenues. (d) In addition to scheduled Borrowing Base redeterminations pursuant to Subsection 2.6(bSECTION 2.4(B), the Lender or the Borrower Administrative Agent may cause a special redetermination of the Borrowing Base at during any one time during each Borrowing Base Period. In the event the Borrower requests such a Borrowing Base redetermination, the Borrower shall deliver written notice of such request to the Lender with (i) a report, in form and substance satisfactory to the Lender, prepared by Scotia Group, Inc. or another independent petroleum engineer or firm of engineers reasonably acceptable to the Lender, which report shall set forth, as of a date not more than sixty (60) calendar days prior to the date of such request, projections of future net income from hydrocarbons classified as "Proved Reserves" attributable to all of the Borrowing Base Properties, (ii) such other information concerning such Oil and Gas Properties as the Lender may reasonably request, including, without limitation, engineering, geological and performance data, and (iii) the amount of the Borrowing Base requested by the Borrower to become effective. Likewise, in the event the Lender exercises its option for a Borrowing Base redetermination pursuant to this Subsection 2.6(d), upon written request and notification by the Lender to the Borrower, the Borrower shall furnish the information described above within thirty (30) days of such request. The Lender Administrative Agent shall redetermine the Borrowing Base using the most recent reserve report delivered to the Administrative Agent pursuant to SECTION 5.5, as adjusted for cumulative production, any material additions to, deletions from or any other material changes in the Proved Reserves attributable to the Mortgaged Properties and changes, if any, to pricing and cost assumptions since the effective date of such reserve report and in accordance with the procedures set forth in Subsection 2.6(cSECTION 2.4(B) and (C) which redetermined Borrowing Base shall then be the effective Borrowing Base until further redetermination. (e) In addition to the scheduled Borrowing Base redeterminations pursuant to SECTION 2.4(B), the Borrower may cause a special redetermination during any Borrowing Base Period. The Borrower agrees to pay shall furnish additional reserve reports with respect to the Lender Mortgaged Properties, which additional reserve reports shall be in form and substance satisfactory to the Administrative Agent, prepared by an engineering fee independent petroleum engineer satisfactory to the Administrative Agent, which shall set forth, as of $2,500.00 upon a specific date, any material additions to, deletions from or any other material changes in the execution and delivery of this Agreement and upon each redetermination of Proved Reserves attributable to the Mortgaged Properties reflected in the reserve report most recently furnished to the Administrative Agent as provided pursuant to SECTION 5.5. The Administrative Agent shall promptly redetermine the Borrowing Base as in accordance with the procedures set forth in Subsections 2.6 (bSECTION 2.4(B) and (d)C) which redetermined Borrowing Base shall then be the effective Borrowing Base until further redetermination.

Borrowing Base Determinations. (a) The initial Borrowing Base as of the date of the Fifth Amendment is hereby established at acknowledged by the Borrowers and the Lender to be $4,000,000.002,750,000, which is all attributable to the Borrowing Base Oil and Gas Properties and $0.00 is attributable to the Borrowing Base Accounts. The amount of the Borrowing Base attributable to the Borrowing Base Oil and Gas Properties (as reduced from time to time under the terms of this Agreement) shall be reduced by $115,000 on the first day of each month beginning April 1, 2008. (b) The Borrowing Base attributable to the Borrowing Base Oil and Gas Properties and the Borrowing Base Accounts will not be scheduled for redetermination. Borrowers shall have no right to request that Lender redetermine the Borrowing Base attributable to the Borrowing Base Oil and Gas Properties or the Borrowing Base Accounts. Notwithstanding the foregoing, the Lender may in its discretion redetermine the Borrowing Base attributable to the Borrowing Base Oil and Gas Properties based on Reserve Reports and all other information available to the Lender and the amount by which the Borrowing Base shall be redetermined by the Lender for reduced each Borrowing Base Period commencing September 1, 2007, and effective calendar month as of the date set forth in a notice of redetermination delivered Section 2.7(a) at any time and from time to the Borrowertime. (c) The Upon each determination of the Borrowing Base shall be made, at the sole discretion of and any such monthly reductions by the Lender, by reviewing the estimates Lender shall notify the Borrower in writing of the projected rate of production such determination, and projected revenues from the Borrowing Base Properties and the amount by which the Borrowing Base shall be reduced so communicated to the Borrowers shall become effective upon such other credit factors (including, without limitation, written notification and shall remain in effect until the assets, liabilities, cash flow, current Derivative Contracts, business, properties, prospects, management and ownership next redetermination by Lender of the Borrower) as Borrowing Base and the Lender in its sole discretion deems significant. The Lender may make adjustments, in good faith and at its sole discretion and in accordance with its customary practices, to such estimates of amount by which the projected rate of production and projected revenuesBorrowing Base shall be reduced. (d) In addition to scheduled The Borrowing Base redeterminations pursuant to Subsection 2.6(b)shall represent the determination by the Lender, in accordance with the Lender or applicable definitions and provisions herein contained and its customary lending practices for loans of this nature, of the Borrower may cause a redetermination value, for loan purposes, of the Borrowing Base at any one time during each Borrowing Base PeriodOil and Gas Properties. In the event the Borrower requests such a Borrowing Base redeterminationFurthermore, the Borrower shall deliver written notice of such request to the Lender with Borrowers acknowledge that (i) a report, in form and substance satisfactory to the Lender, prepared by Scotia Group, Inc. or another independent petroleum engineer or firm of engineers reasonably acceptable to the Lender, which report shall set forth, as of a date not more than sixty (60) calendar days prior to the date of such request, projections of future net income from hydrocarbons classified as "Proved Reserves" attributable to all determination of the Borrowing Base Propertiescontains an equity cushion, which is acknowledged by the Borrower to be essential for the adequate protection of the Lender and (ii) such other information concerning such the Borrowing Base will not be increased following the date of this Fifth Amendment, and Lender shall have no obligation to increase the Borrowing Base or redetermine the Borrowing Base attributable to either the Borrowing Base Oil and Gas Properties as the Lender may reasonably request, including, without limitation, engineering, geological and performance data, and (iii) the amount of or the Borrowing Base requested by the Borrower to become effective. Likewise, in the event the Lender exercises its option for a Borrowing Base redetermination pursuant to this Subsection 2.6(d), upon written request and notification by the Lender to the Borrower, the Borrower shall furnish the information described above within thirty (30) days of such request. The Lender shall redetermine the Borrowing Base in accordance with the procedures set forth in Subsection 2.6(c) which redetermined Borrowing Base shall then be the effective Borrowing Base until further redeterminationAccounts. (e) The Borrower agrees to pay to the Lender an engineering fee of $2,500.00 upon the execution and delivery of this Agreement and upon each redetermination of the Borrowing Base as set forth in Subsections 2.6 (b) and (d).