Common use of Limitation on Sales of Property Clause in Contracts

Limitation on Sales of Property. No Restricted Person will sell, transfer, lease, exchange, alienate or dispose of any of its material assets or properties or any material interest therein or portions thereof, or discount, sell, pledge or assign any notes payable to it, accounts receivable or future income, except, to the extent not otherwise forbidden under the Security Documents: (a) equipment which is worthless or obsolete or which is replaced by equipment of equal suitability and value; (b) inventory (including oil and gas sold as produced and seismic data) which is sold in the ordinary course of business on ordinary trade terms; (c) capital stock of any of Borrower’s Subsidiaries which is transferred to Borrower or a wholly owned Subsidiary of Borrower; (d) interests in real properties or portions thereof, to which no Proved Reserves of oil, gas or other liquid or gaseous hydrocarbons are properly attributed; (e) leases of drilling rigs in the ordinary course of business and sales of drilling rigs described in Schedule 5; (f) exchanges of (i) Restricted Persons’ oil and gas leasehold interests in non-producing zones, to which no Proved Reserves of oil, gas or other liquid or gaseous hydrocarbons are properly attributed, whether or not such interests are subject to Liens in favor of Administrative Agent, for (ii) other oil and gas leasehold interests in producing or non-producing zones owned by other Persons; (g) transfers among Borrower and Guarantors; (h) sales, dispositions, leases or exchanges of other property for a purchase price paid in cash or property constituting a Core Acquisition and Investment or a Non-Core Acquisition and Investment, to the extent permitted by Section 7.7; (i) the lease, assignment, license, sub-license or sub-lease of any personal property in the ordinary course of business to the extent the same does not materially interfere with the business of Borrower or any Subsidiary; (j) the creation and foreclosure of a Permitted Lien; (k) the surrender or waiver of contract rights or the disposition, settlement, release or surrender of contract, tort or other claims of any kind; (l) Dividends permitted by Section 7.6; (m) Investments permitted by Section 7.7(a); and (n) endorsements of negotiable instruments for collection in the ordinary course of business; provided that if all such property sold, disposed, leased or exchanged pursuant to the preceding subsections (h), (i), (j) and (k) in the aggregate during any period between any two sequential Determination Dates comprises five percent (5%) or more of the engineered Borrowing Base value (as determined by Administrative Agent in its sole and absolute discretion), the Borrowing Base shall be reduced effective immediately upon such sale, disposition, lease or exchange by an amount equal to the engineered Borrowing Base value of all such properties (as determined by Administrative Agent in its sole and absolute discretion), which reduction will be effective upon the sale, disposition, lease or exchange that causes such value to exceed such five (5%) computation and from time to time thereafter in connection with any future sales, dispositions, leases or exchanges prior to the next Determination Date.

Limitation on Sales of Property. No Restricted Person will sell, transfer, lease, exchange, alienate or dispose of any of its material assets or properties or any material interest therein or portions thereof, or discount, sell, pledge or assign any notes payable to it, accounts receivable or future income, except, to the extent not otherwise forbidden under the Security Documents: (a) equipment which is worthless or obsolete or which is replaced by equipment of equal suitability and value; (b) inventory (including oil and gas sold as produced and seismic data) which is sold in the ordinary course of business on ordinary trade terms; (c) capital stock of any of Borrower’s Subsidiaries which is transferred to Borrower or a wholly owned Subsidiary of Borrower; (d) interests in real oil and gas properties or portions thereof, to which no Proved Reserves of oil, gas or other liquid or gaseous hydrocarbons are properly attributed; (e) leases of drilling rigs in the ordinary course of business and sales of drilling rigs that are under options for sale on the Closing Date which are described in Schedule 54; (f) exchanges of (i) Restricted Persons’ oil and gas leasehold interests in non-producing zones, to which no Proved Reserves of oil, gas or other liquid or gaseous hydrocarbons are properly attributed, whether or not such interests are subject to Liens in favor of Administrative Agent, for (ii) other oil and gas leasehold interests in producing or non-producing zones owned by other Persons; (g) exchanges and transfers of Mineral Interests located in the DJ Basin in Colorado owned by Restricted Persons (in this Section called the “B▇▇▇▇ ▇▇ Properties”) for Mineral Interests located therein by Rosewood Resources (in this Section called “Rosewood DJ Properties”); provided that the aggregate amount of Rosewood DJ Properties received in exchange for B▇▇▇▇ ▇▇ Properties shall have a value equivalent to the B▇▇▇▇ ▇▇ Properties so exchanged; (h) transfers among Borrower and Guarantors; (hi) sales, dispositions, leases or exchanges sales and dispositions of other property for a purchase price paid in cash or property constituting a Core Acquisition and Investment or a Non-Core Acquisition and Investment, Mineral Interests in an amount at least equal to the extent permitted by Section 7.7; (i) the lease, assignment, license, sub-license or sub-lease of any personal property in the ordinary course of business to the extent the same does not materially interfere with the business of Borrower or any Subsidiary; (j) the creation and foreclosure of a Permitted Lien; (k) the surrender or waiver of contract rights or the disposition, settlement, release or surrender of contract, tort or other claims of any kind; (l) Dividends permitted by Section 7.6; (m) Investments permitted by Section 7.7(a); and (n) endorsements of negotiable instruments for collection in the ordinary course of businessfair market value thereof; provided that if the aggregate sales price for all such property sold, disposed, leased or exchanged pursuant to the preceding subsections (h), (i), (j) and (k) in the aggregate sold during any period between any two sequential Determination Dates comprises of twelve (12) consecutive calendar months exceeds five percent (5%) or more of the engineered Present Value of the Borrowing Base value (as determined by Administrative Agent in its sole and absolute discretion)Properties, the Borrowing Base shall be reduced effective immediately upon such sale, disposition, lease sale or exchange disposition by an amount equal to the engineered Borrowing Base value of all value, if any, assigned to such properties (as determined by Administrative Agent property in its sole and absolute discretion), which reduction will be effective upon the sale, disposition, lease or exchange that causes such value to exceed such five (5%) computation and from time to time thereafter in connection with any future sales, dispositions, leases or exchanges prior to the next Determination Datemost recently delivered Engineering Report.

Limitation on Sales of Property. No Restricted Person will sell, transfer, lease, exchange, alienate or dispose of any of its material assets or properties or any material interest therein or portions thereof, or discount, sell, pledge or assign any notes payable to it, accounts receivable or future income, except, to the extent not otherwise forbidden under the WF Security Documents: (a) equipment which is worthless or obsolete or which is replaced by equipment of equal suitability and value; (b) inventory (including oil and gas sold as produced and seismic data) which is sold in the ordinary course of business on ordinary trade terms; (c) capital stock of any of Borrower’s 's Subsidiaries which is transferred to Borrower or a wholly owned Subsidiary of Borrower; (d) interests in real oil and gas properties or portions thereof, to which no Proved Reserves of oil, gas or other liquid or gaseous hydrocarbons are properly attributed; (e) leases of drilling rigs in the ordinary course of business and sales of drilling rigs that are under options for sale on the Closing Date which are described in Schedule 53; (f) exchanges of (i) Restricted Persons’ ' oil and gas leasehold interests in non-producing zones, zones to which no Proved Reserves of oil, gas or other liquid or gaseous hydrocarbons are properly attributed, whether or not such interests are subject to Liens created under the WF Security Documents in favor of Administrative WF Agent, for (ii) other oil and gas leasehold interests in producing or non-producing zones owned by other Persons; (g) exchanges and transfers of Mineral Interests located in the DJ Basin in Colorado owned by Restricted Persons (in this Section called the "▇▇▇▇▇ ▇▇ Properties") for Mineral Interests located therein by Rosewood Resources (in this Section called "Rosewood DJ Properties"); provided that the aggregate amount of Rosewood DJ Properties received in exchange for ▇▇▇▇▇ ▇▇ Properties shall have a value equivalent to the ▇▇▇▇▇ ▇▇ Properties so exchanged; (h) transfers among Borrower and Guarantors; (hi) sales, dispositions, leases or exchanges sales and dispositions of other property for a purchase price paid in cash or property constituting a Core Acquisition and Investment or a Non-Core Acquisition and Investment, to the extent permitted by Section 7.7; (i) the lease, assignment, license, sub-license or sub-lease of any personal property Mineral Interests in the ordinary course of business to the extent the same does not materially interfere with the business of Borrower or any Subsidiary; (j) the creation and foreclosure of a Permitted Lien; (k) the surrender or waiver of contract rights or the disposition, settlement, release or surrender of contract, tort or other claims of any kind; (l) Dividends permitted by Section 7.6; (m) Investments permitted by Section 7.7(a); and (n) endorsements of negotiable instruments for collection in the ordinary course of business; provided that if all such property sold, disposed, leased or exchanged pursuant to the preceding subsections (h), (i), (j) and (k) in the aggregate during any period between any two sequential Determination Dates comprises five percent (5%) or more of the engineered Borrowing Base value (as determined by Administrative Agent in its sole and absolute discretion), the Borrowing Base shall be reduced effective immediately upon such sale, disposition, lease or exchange by an amount at least equal to the engineered Borrowing Base fair market value of all such properties (as determined by Administrative Agent in its sole and absolute discretion), which reduction will be effective upon the sale, disposition, lease or exchange that causes such value to exceed such five (5%) computation and from time to time thereafter in connection with any future sales, dispositions, leases or exchanges prior to the next Determination Datethereof.

Limitation on Sales of Property. No Restricted Person will sell, transfer, lease, exchange, alienate or dispose of any of its material assets or properties or any material interest therein or portions thereof, or discount, sell, pledge or assign any notes payable to it, accounts receivable or future income, except, to the extent not otherwise forbidden under the Security Documents: (a) equipment which is worthless or obsolete or which is replaced by equipment of equal suitability and value; (b) inventory (including oil and gas sold as produced and seismic data) which is sold in the ordinary course of business on ordinary trade terms; (c) capital stock of any of Borrower’s Subsidiaries which is transferred to Borrower or a wholly owned Subsidiary of Borrower; (d) interests in real oil and gas properties or portions thereof, to which no Proved Reserves of oil, gas or other liquid or gaseous hydrocarbons are properly attributed; (e) leases of drilling rigs in the ordinary course of business and sales of drilling rigs which are described in Schedule 54; (f) gathering pipelines and compression and dehydration equipment located in the Piceance Basin in Colorado and the Darko and ▇▇▇▇▇ Field in East Texas; (g) exchanges of (i) Restricted Persons’ oil and gas leasehold interests in non-producing zones, to which no Proved Reserves of oil, gas or other liquid or gaseous hydrocarbons are properly attributed, whether or not such interests are subject to Liens in favor of Administrative Agent, for (ii) other oil and gas leasehold interests in producing or non-producing zones owned by other Persons; (gh) transfers among Borrower and Guarantors;; and (hi) sales, dispositions, leases or exchanges sales and dispositions of other property for a purchase price paid in cash or property constituting a Core Acquisition and Investment or a Non-Core Acquisition and Investment, Mineral Interests in an amount at least equal to the extent permitted by Section 7.7; (i) the lease, assignment, license, sub-license or sub-lease of any personal property in the ordinary course of business to the extent the same does not materially interfere with the business of Borrower or any Subsidiary; (j) the creation and foreclosure of a Permitted Lien; (k) the surrender or waiver of contract rights or the disposition, settlement, release or surrender of contract, tort or other claims of any kind; (l) Dividends permitted by Section 7.6; (m) Investments permitted by Section 7.7(a); and (n) endorsements of negotiable instruments for collection in the ordinary course of businessfair market value thereof; provided that if the aggregate sales price for all such property sold, disposed, leased or exchanged pursuant to the preceding subsections (h), (i), (j) and (k) in the aggregate sold during any period between any two sequential Determination Dates comprises calculations of Total Proved PV10% exceeds five percent (5%) or more of the engineered Borrowing Base value (as determined by Administrative Agent in its sole and absolute discretion)then effective Total Proved PV10%, the Borrowing Base Total Proved PV10% shall be reduced effective immediately upon such sale, disposition, lease sale or exchange disposition by an amount equal to the engineered Borrowing Base value assigned to such property in the most recent calculation of all such properties (as determined by Administrative Agent in its sole and absolute discretion), which reduction will be effective upon the sale, disposition, lease or exchange that causes such value to exceed such five (5Total Proved PV10%) computation and from time to time thereafter in connection with any future sales, dispositions, leases or exchanges prior to the next Determination Date.