Sale of Properties. The Borrower will not, nor will it permit any other Credit Party to, sell, assign, farm-out, convey or otherwise transfer (collectively in this section, “Transfer”) any Oil and Gas Property or any interest in Hydrocarbons produced or to be produced therefrom or any Equity Interest in any Credit Party that owns any Oil and Gas Property, commodity Swap Agreement or any interest in Hydrocarbons produced or to be produced therefrom (in this section, an “E&P Credit Party”) or unwind or terminate any commodity Swap Agreements, except for: (a) the sale of Hydrocarbons in the ordinary course of business; (b) farmouts, swaps or trades of undeveloped acreage not included in the most recently delivered Reserve Report and assignments in connection with such farmouts, swaps or trades; (c) the Transfer of equipment that is no longer necessary for the business of the Borrower or such other Credit Party or is replaced by equipment of at least comparable value or use; (d) Transfers of Oil and Gas Properties that are not Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base; (i) Transfers of Oil and Gas Properties that comprise Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, provided that such Transfers are for fair market value, (ii) the unwinding or termination of commodity Swap Agreements; or (iii) Transfers of all (but not less than all) of the Equity Interests collectively owned by the Borrower and its Subsidiaries in any E&P Credit Party; provided that in the case of clause (i) or (ii) above, except with respect to any novation or replacement, as applicable, contemplated by the final proviso of this Section 9.10(e), at least seventy-five percent (75%) (or such greater percentage as may be required to eliminate any resulting Borrowing Base Deficiency) of the consideration received in respect of such sale or other disposition or unwinding or termination, as applicable, shall be cash or cash equivalents; provided, further, that to the extent that, if during any period commencing with the later of the most recent Scheduled Redetermination Date or the most recent adjustment to the Borrowing Base pursuant to this Section 9.10 through the next Scheduled Redetermination Date, Oil and Gas Properties and commodity Swap Agreements with an aggregate Borrowing Base value in excess of five percent (5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent), are Transferred or unwound or terminated, as applicable, by any one or more Credit Parties pursuant to this Section 9.10(e), then the Borrowing Base will be reduced, effective immediately, by the Borrowing Base values in excess of such five percent (5%) threshold; provided, further, that for purposes of the foregoing proviso, (A) a commodity Swap Agreement shall be deemed to have not been unwound or terminated if, (x) such commodity Swap Agreement is novated from the existing counterparty to an Approved Counterparty, with the Borrower or the applicable Credit Party being the “remaining party” for purposes of such novation, or (y) upon its termination or unwinding, it is replaced, in a substantially contemporaneous transaction, with one or more commodity Swap Agreements with the same or longer tenor, covering volumes not less than and for prices not less than those Swap Agreements being replaced and without cash payments to any Credit Party in connection therewith, and (B) an Oil and Gas Property shall be deemed to have not been Transferred if upon its Transfer, it is replaced, in a substantially contemporaneous transaction, with Oil and Gas Properties with approximately the same PV-9 value as reasonably determined by Borrower in good faith and evidenced by delivery to the Administrative Agent of a certificate of a Responsible Officer containing reasonably detailed supporting information for such good faith determination; provided that, this clause (B) shall only apply and may only be relied on to the extent that the Oil and Gas Properties so Transferred in exchange for other Oil and Gas Properties in any period between two successive Scheduled Redetermination Dates does not exceed seven and one-half percent (7.5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent). For the purposes of the preceding sentence, the Transfer of an E&P Credit Party owning such Oil and Gas Properties and/or commodity Swap Agreements pursuant to this Section 9.10(e) shall be deemed the Transfer of the Oil and Gas Properties and the unwinding or termination of the commodity Swap Agreements owned by such E&P Credit Party; (f) Transfers in connection with Investments permitted by Section 9.05, other than Transfers of (i) any Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base or (ii) any Equity Interests in any E&P Credit Party owning Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base; and (g) Transfers of Properties among the Credit Parties; provided that (i) with respect to any Transfers of Equity Interests in any E&P Credit Party, the requirements of Section 8.14(b) are satisfied and (ii) with respect to any Transfers of Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, the transferee promptly delivers mortgages or other Security Instruments in favor of the Administrative Agent to the extent necessary to satisfy the requirements of Section 8.14.
Appears in 2 contracts
Sources: Credit Agreement (Civitas Resources, Inc.), Credit Agreement (Civitas Resources, Inc.)
Sale of Properties. The Borrower will not, nor and will it not permit any other Credit Party Subsidiary to, sell, assign, farm-out, convey or otherwise transfer (collectively in this section, “Transfer”) any Oil and Gas Property or any interest in Hydrocarbons produced or to be produced therefrom or any Equity Interest in any Credit Party that owns any Oil and Gas Property, commodity Swap Agreement or any interest in Hydrocarbons produced or to be produced therefrom (in this section, an “E&P Credit Party”) or unwind or terminate any commodity Swap Agreements, except for:
(a) the sale of Hydrocarbons Finished Sand Inventory or other minerals in the ordinary course of businessbusiness on ordinary terms; provided that no contract for the sale of Finished Sand Inventory or other minerals (solely to the extent not involving consideration having a fair market value in excess of $3,000,000 in the aggregate, not including the ▇▇▇▇▇▇▇▇ Contract) shall obligate the Borrower or any of its Subsidiaries to deliver Finished Sand Inventory or other minerals at a future date without receiving full payment therefor within ninety (90) days after delivery;
(b) farmouts, swaps any such transfer permitted under Section 9.11 or trades of undeveloped acreage not included in the most recently delivered Reserve Report and assignments in connection with such farmouts, swaps or tradesproviso to Section 9.12;
(c) the Transfer sale or issuance of any Equity Interest in a Subsidiary to any Loan Party;
(d) the issuance of Equity Interests (other than Disqualified Capital Stock) in the Borrower for cash;
(e) the sale or issuance of any Subsidiary’s Equity Interests to the Borrower or any Wholly-Owned Subsidiary that is a Guarantor;
(f) the sale or transfer of equipment that is no longer necessary for the business of the Borrower or such other Credit Loan Party or is replaced by equipment of at least comparable value or and use;
(dg) Transfers licensing and cross-licensing arrangements involving any technology or other intellectual property of Oil and Gas Properties that are not Proved Oil and Gas Properties evaluated Borrower or any Subsidiary in the Reserve Report used ordinary course of business;
(h) the abandonment of any rights, franchises, licenses, or intellectual property that any Borrower reasonably determines are no longer useful in the most recent determination of the Borrowing Base;its business or commercially desirable; and
(i) Transfers of Oil and Gas Properties that comprise Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, provided that such Transfers are for fair market value, (ii) the unwinding or termination of commodity Swap Agreements; or (iii) Transfers of all (but not less than all) of the Equity Interests collectively owned by the Borrower and its Subsidiaries in any E&P Credit Party; provided that in the case of clause (i) or (ii) above, except with respect to any novation or replacement, as applicable, contemplated by the final proviso of this Section 9.10(e), at least seventy-five percent (75%) (or such greater percentage as may be required to eliminate any resulting Borrowing Base Deficiency) of the consideration received in respect of such sale or other disposition or unwinding or termination(including Casualty Events and events that would, as applicablebut for their magnitude, shall be cash or cash equivalents; provided, further, that constitute Casualty Events) of Properties not regulated by Section 9.13(a) to (h) having a fair market value not to exceed $1,000,000 in the extent that, if aggregate during any period commencing with the later of the most recent Scheduled Redetermination Date or the most recent adjustment to the Borrowing Base pursuant to this Section 9.10 through the next Scheduled Redetermination Date, Oil and Gas Properties and commodity Swap Agreements with an aggregate Borrowing Base value in excess of five percent twelve (5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent), are Transferred or unwound or terminated, as applicable, by any one or more Credit Parties pursuant to this Section 9.10(e), then the Borrowing Base will be reduced, effective immediately, by the Borrowing Base values in excess of such five percent (5%) threshold; provided, further, that for purposes of the foregoing proviso, (A) a commodity Swap Agreement shall be deemed to have not been unwound or terminated if, (x) such commodity Swap Agreement is novated from the existing counterparty to an Approved Counterparty, with the Borrower or the applicable Credit Party being the “remaining party” for purposes of such novation, or (y) upon its termination or unwinding, it is replaced, in a substantially contemporaneous transaction, with one or more commodity Swap Agreements with the same or longer tenor, covering volumes not less than and for prices not less than those Swap Agreements being replaced and without cash payments to any Credit Party in connection therewith, and (B) an Oil and Gas Property shall be deemed to have not been Transferred if upon its Transfer, it is replaced, in a substantially contemporaneous transaction, with Oil and Gas Properties with approximately the same PV-9 value as reasonably determined by Borrower in good faith and evidenced by delivery to the Administrative Agent of a certificate of a Responsible Officer containing reasonably detailed supporting information for such good faith determination; provided that, this clause (B) shall only apply and may only be relied on to the extent that the Oil and Gas Properties so Transferred in exchange for other Oil and Gas Properties in any period between two successive Scheduled Redetermination Dates does not exceed seven and one-half percent (7.5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent). For the purposes of the preceding sentence, the Transfer of an E&P Credit Party owning such Oil and Gas Properties and/or commodity Swap Agreements pursuant to this Section 9.10(e) shall be deemed the Transfer of the Oil and Gas Properties and the unwinding or termination of the commodity Swap Agreements owned by such E&P Credit Party;
(f) Transfers in connection with Investments permitted by Section 9.05, other than Transfers of (i) any Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base or (ii) any Equity Interests in any E&P Credit Party owning Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base; and
(g) Transfers of Properties among the Credit Parties; provided that (i) with respect to any Transfers of Equity Interests in any E&P Credit Party, the requirements of Section 8.14(b) are satisfied and (ii) with respect to any Transfers of Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, the transferee promptly delivers mortgages or other Security Instruments in favor of the Administrative Agent to the extent necessary to satisfy the requirements of Section 8.1412)-month period.
Appears in 2 contracts
Sources: Senior Secured Credit Agreement (Vista Proppants & Logistics Inc.), Senior Secured Credit Agreement (Vista Proppants & Logistics Inc.)
Sale of Properties. The Borrower will not, nor and will it not permit any other Credit Party Subsidiary to, sell, assign, farm-out, convey or otherwise transfer (collectively in this section, “Transfer”) any Oil and Gas Property or any interest in Hydrocarbons produced or to be produced therefrom or any Equity Interest in any Credit Party that owns any Oil and Gas Property, commodity Swap Agreement or any interest in Hydrocarbons produced or to be produced therefrom (in this section, an “E&P Credit Party”) or unwind or terminate any commodity Swap Agreements, except for:
(a) dispositions of cash and cash equivalents in the ordinary course of business and in connection with the consummation of the Specified Transactions and other transactions permitted by this Agreement;
(b) the sale of Hydrocarbons inventory in the ordinary course of business;
(b) farmouts, swaps or trades of undeveloped acreage not included in the most recently delivered Reserve Report and assignments in connection with such farmouts, swaps or trades;
(c) the Transfer sale or transfer of equipment that is obsolete or worn out property and property no longer necessary for used or useful in the conduct of the business of the Borrower and its Subsidiaries, whether now owned or such other Credit Party hereafter acquired, in the ordinary course of business or is replaced by equipment replacement property of at least comparable value or and use;
(d) Transfers issuances of Oil distributions or other Restricted Payments permitted pursuant to Section 9.04;
(e) Restricted Payments permitted by Section 9.04 and Gas Properties Liens permitted by Section 9.03;
(f) the transfer of Property to another Loan Party;
(g) the transfer of Property to an Excluded Subsidiary, provided that are not Proved Oil (i) no Default exists at the time of or after giving effect to such transfer, and Gas Properties evaluated (ii) such transfer is deemed to be an Investment in such Excluded Subsidiary in an amount equal to the Reserve Report used in the most recent determination fair market value of the Borrowing BaseProperty transferred as of the date of such transfer and such Investment would be permitted to be made at the time of such transfer under Section 9.05(n);
(h) the transfer of Property occurring in connection with a transaction permitted by, and made in compliance with the provisions of, Section 9.10;
(i) Transfers of Oil and Gas Properties that comprise Proved Oil and Gas Properties evaluated Asset Sales having, in the Reserve Report used aggregate for all Asset Sales by the Borrower or any Subsidiary, a fair market value not to exceed $6,000,000 during any fiscal year of the Borrower;
(j) other Asset Sales, subject to Section 3.04(b)(ii);
(k) dispositions of accounts receivables in connection with the collection or compromise thereof in the most recent determination ordinary course of business to the Borrowing Baseextent permitted under Section 9.09;
(l) grants of Leases, provided that such Transfers are for fair market valuesubleases, licenses or sublicenses (ii) including the unwinding provision of software under an open source license), easements, rights of way or termination similar rights or encumbrances in each case in the ordinary course of commodity Swap Agreements; or (iii) Transfers business and which do not materially interfere with the business of all (but not less than all) of the Equity Interests collectively owned by the Borrower and its Subsidiaries in any E&P Credit Party; provided that in the case of clause (i) or (ii) above, except with respect to any novation or replacement, as applicable, contemplated by the final proviso of this Section 9.10(e), at least seventy-five percent (75%) (or such greater percentage as may be required to eliminate any resulting Borrowing Base Deficiency) of the consideration received in respect of such sale or other disposition or unwinding or termination, as applicable, shall be cash or cash equivalents; provided, further, that to the extent that, if during any period commencing with the later of the most recent Scheduled Redetermination Date or the most recent adjustment to the Borrowing Base pursuant to this Section 9.10 through the next Scheduled Redetermination Date, Oil and Gas Properties and commodity Swap Agreements with an aggregate Borrowing Base value in excess of five percent (5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent), are Transferred or unwound or terminated, as applicable, by any one or more Credit Parties pursuant to this Section 9.10(e), then the Borrowing Base will be reduced, effective immediately, by the Borrowing Base values in excess of such five percent (5%) threshold; provided, further, that for purposes of the foregoing proviso, (A) a commodity Swap Agreement shall be deemed to have not been unwound or terminated if, (x) such commodity Swap Agreement is novated from the existing counterparty to an Approved Counterparty, with the Borrower or the applicable Credit Party being the “remaining party” for purposes of such novation, or (y) upon its termination or unwinding, it is replaced, in a substantially contemporaneous transaction, with one or more commodity Swap Agreements with the same or longer tenor, covering volumes not less than and for prices not less than those Swap Agreements being replaced and without cash payments to any Credit Party in connection therewith, and (B) an Oil and Gas Property shall be deemed to have not been Transferred if upon its Transfer, it is replaced, in a substantially contemporaneous transaction, with Oil and Gas Properties with approximately the same PV-9 value as reasonably determined by Borrower in good faith and evidenced by delivery to the Administrative Agent of a certificate of a Responsible Officer containing reasonably detailed supporting information for such good faith determination; provided that, this clause (B) shall only apply and may only be relied on to the extent that the Oil and Gas Properties so Transferred in exchange for other Oil and Gas Properties in any period between two successive Scheduled Redetermination Dates does not exceed seven and one-half percent (7.5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent). For the purposes of the preceding sentence, the Transfer of an E&P Credit Party owning such Oil and Gas Properties and/or commodity Swap Agreements pursuant to this Section 9.10(e) shall be deemed the Transfer of the Oil and Gas Properties and the unwinding or termination of the commodity Swap Agreements owned by such E&P Credit Party;
(f) Transfers in connection with Investments permitted by Section 9.05, other than Transfers of (i) any Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base or (ii) any Equity Interests in any E&P Credit Party owning Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing BaseSubsidiaries; and
(gm) Transfers transfers of Properties among the Credit Parties; provided Property that (i) with respect to any Transfers of Equity Interests in any E&P Credit Party, the requirements of Section 8.14(b) are satisfied and (ii) with respect to any Transfers of Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination has suffered a Casualty Event upon receipt of the Borrowing Base, the transferee promptly delivers mortgages or other Security Instruments in favor Net Cash Proceeds of the Administrative Agent to the extent necessary to satisfy the requirements of Section 8.14such Casualty Event.
Appears in 2 contracts
Sources: Term Loan Credit Agreement, Term Loan Credit Agreement (Southcross Energy Partners, L.P.)
Sale of Properties. The Borrower will not, nor and will it not permit any other Credit Party Subsidiary to, sell, assign, farm-out, convey or otherwise transfer (collectively in this section, “Transfer”) any Oil and Gas Property or any interest in Hydrocarbons produced or to be produced therefrom or any Equity Interest in any Credit Party that owns any Oil and Gas Property, commodity Swap Agreement or any interest in Hydrocarbons produced or to be produced therefrom (in this section, an “E&P Credit Party”) or unwind or terminate any commodity Swap Agreements, except for:
for (a) the sale of Hydrocarbons in the ordinary course of business;
; (b) farmouts, swaps or trades farmouts of undeveloped acreage not included in the most recently delivered Reserve Report and assignments in connection with such farmouts, swaps or trades;
farmouts to which there are no Proved Reserves attributable; (c) the Transfer sale or transfer of equipment that is no longer necessary for the business of the Borrower or such other Credit Party Subsidiary or is replaced by equipment of at least comparable value or and use;
; and (d) Transfers so long as no Event of Oil and Gas Properties that are not Proved Oil and Gas Properties evaluated in Default is then continuing or will result therefrom, Asset Dispositions (including Asset Dispositions pursuant to the Reserve Report used in the most recent determination of the Borrowing Base;
(i) Transfers of Oil and Gas Properties that comprise Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, provided that such Transfers are for fair market value, (ii) the unwinding or termination of commodity Swap Agreements; or (iii) Transfers of all (but not less than all) of the Equity Interests collectively owned by the Borrower and its Subsidiaries in any E&P Credit PartyWIIP); provided that in the case of clause (i1) or (ii) above, except with respect to any novation or replacement, as applicable, contemplated by the final proviso of this Section 9.10(e), at least seventy-five percent (75%) (or such greater percentage as may be required to eliminate any resulting Borrowing Base Deficiency) all of the consideration received in respect of to such sale or other disposition or unwinding or termination, as applicable, Asset Disposition shall be cash cash, (2) the consideration received shall be equal to or cash equivalents; provided, further, that to greater than the extent that, if during any period commencing with the later of the most recent Scheduled Redetermination Date or the most recent adjustment to the Borrowing Base pursuant to this Section 9.10 through the next Scheduled Redetermination Date, Oil and Gas Properties and commodity Swap Agreements with an aggregate Borrowing Base fair market value in excess of five percent (5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties thereof (as reasonably determined by the Borrower and, if requested by the Administrative Agent), are Transferred or unwound or terminated, as applicable, by any one or more Credit Parties pursuant to this Section 9.10(e), then the Borrowing Base will be reduced, effective immediately, by the Borrowing Base values in excess of such five percent (5%) threshold; provided, further, that for purposes of the foregoing proviso, (A) a commodity Swap Agreement shall be deemed to have not been unwound or terminated if, (x) such commodity Swap Agreement is novated from the existing counterparty to an Approved Counterparty, with the Borrower or the applicable Credit Party being the “remaining party” for purposes of such novation, or (y) upon its termination or unwinding, it is replaced, in a substantially contemporaneous transaction, with one or more commodity Swap Agreements with the same or longer tenor, covering volumes not less than and for prices not less than those Swap Agreements being replaced and without cash payments to any Credit Party in connection therewith, and (B) an Oil and Gas Property shall be deemed to have not been Transferred if upon its Transfer, it is replaced, in a substantially contemporaneous transaction, with Oil and Gas Properties with approximately the same PV-9 value as reasonably determined by Borrower in good faith and evidenced by delivery to the Administrative Agent of deliver a certificate of a Responsible Officer containing reasonably detailed supporting information for of the Borrower certifying to that effect), and (3) if such good faith determination; provided that, this clause (B) shall only apply and may only be relied on to the extent that the sale or other disposition of Oil and Gas Properties so Transferred Property included in exchange for other Oil and Gas Properties in the most recently delivered Reserve Report during any period between two successive Scheduled Redetermination Dates does not exceed seven and one-half Redeterminations has a Recognized Value, individually or in the aggregate, in excess of five percent (7.5%) of the then current Borrowing Base, the Borrowing Base value shall be reduced, effective immediately upon such sale or disposition, by the amount of all Oil and Gas Properties the Recognized Value of the assets included in such Asset Disposition in the then current Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent). For Agent or the purposes Majority Lenders in their discretion.”
M. Section 9.18 of the preceding sentence, the Transfer of an E&P Credit Party owning such Oil and Gas Properties and/or commodity Swap Agreements pursuant Agreement is amended to this Section 9.10(e) shall be deemed the Transfer of the Oil and Gas Properties and the unwinding or termination of the commodity Swap Agreements owned by such E&P Credit Party;
(f) Transfers read in connection with Investments permitted by Section 9.05, other than Transfers of (i) any Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base or (ii) any Equity Interests in any E&P Credit Party owning Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base; and
(g) Transfers of Properties among the Credit Parties; provided that (i) with respect to any Transfers of Equity Interests in any E&P Credit Party, the requirements of Section 8.14(b) are satisfied and (ii) with respect to any Transfers of Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, the transferee promptly delivers mortgages or other Security Instruments in favor of the Administrative Agent to the extent necessary to satisfy the requirements of Section 8.14.its entirety as follows:
Appears in 2 contracts
Sources: Credit Agreement (Pyramid Oil Co), Credit Agreement (Pyramid Delaware Merger Subsidiary, Inc.)
Sale of Properties. The Borrower will not, nor and will it not permit any other Credit Loan Party to, sell, assign, farm-out, convey or otherwise transfer Dispose of any Property (collectively in this section, “Transfer”including the Liquidation of any Swap Agreement) any Oil and Gas Property or any interest in Hydrocarbons produced or to be produced therefrom or any Equity Interest in any Credit Party that owns any Oil and Gas Property, commodity Swap Agreement or any interest in Hydrocarbons produced or to be produced therefrom (in this section, an “E&P Credit Party”) or unwind or terminate any commodity Swap Agreements, except for:
(a) the sale of Hydrocarbons and the lease of Oil and Gas Properties, in each case in the ordinary course of business;
(b) farmouts, swaps or trades farmouts in the ordinary course of business of Oil and Gas Properties consisting solely of undeveloped acreage not included or undrilled depths to which no proved reserves are attributed in the most recently delivered Reserve Report and assignments in connection with such farmoutsfarmouts or the abandonment, swaps farmout, trade, exchange, lease, sublease or tradesother Disposition in the ordinary course of business of Oil and Gas Properties not containing proved reserves and which are not included in the most recently delivered Reserve Report;
(c) the Transfer Disposition of equipment that is no longer necessary for the business of the Borrower or any such other Credit Loan Party or is replaced by equipment of at least comparable value or and use;
(d) Transfers the (i) Disposition, other than as provided in clauses (a) through (c), of any Oil and Gas Property or any interest therein or any Restricted Subsidiary owning Oil and Gas Properties that are not Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base;
(i) Transfers of Oil and Gas Properties that comprise Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, provided that such Transfers are for fair market value, (ii) the unwinding or termination of commodity Swap Agreements; or (iii) Transfers of all (but not less than all) of the Equity Interests collectively owned by the Borrower and its Subsidiaries in any E&P Credit Party; provided that in the case of clause (i) or (ii) above, except with respect to Liquidation of any novation or replacement, as applicable, contemplated by the final proviso of this Section 9.10(e), at least seventy-five percent Swap Agreement; provided that (A) 75%) (or such greater percentage as may be required to eliminate any resulting Borrowing Base Deficiency) % of the consideration received in respect of such sale Disposition or other disposition or unwinding or termination, as applicable, Liquidation shall be cash or cash equivalentsand Cash Equivalents, or, solely with respect to Liquidations, other Swap Agreements permitted by Section 9.18; providedprovided that, furtherwith respect to any Disposition, that notwithstanding the foregoing requirement of this clause (A) (but, for the avoidance of doubt, subject to the extent thatother terms and conditions of this Section 9.12(d)), if during any period commencing the Borrower and/or its Restricted Subsidiaries may exchange Hydrocarbon Interests for other Hydrocarbon Interests with the later of same or better reserve classification, reserve characteristics, reserve lives and decline profiles so long as (1) the most recent Scheduled Redetermination Date or the most recent adjustment to the aggregate Borrowing Base pursuant to this Section 9.10 through value, as determined by the next Scheduled Redetermination DateAdministrative Agent, of all proved Oil and Gas Properties of the Borrower and commodity Swap Agreements with an aggregate Borrowing Base value in excess of five the Restricted Subsidiaries exchanged for such other proved Oil and Gas Properties during any period between two successive Scheduled Redeterminations does not exceed two percent (52%) of the Borrowing Base value of all Oil and Gas Properties included then in effect, (2) to the extent that a Borrowing Base Deficiency could result from an adjustment to the Borrowing Base resulting from such Disposition, after the consummation of the Credit Parties (as reasonably determined by the Administrative Agentsuch Disposition(s), are Transferred the Borrower shall have received net cash proceeds, or unwound or terminatedshall have cash on hand, as applicable, by sufficient to eliminate any one or more Credit Parties such potential Borrowing Base Deficiency pursuant to this Section 9.10(e3.04(c)(iii), then and (3) substantially contemporaneously with the Borrowing Base will be reducedclosing of any such exchange, effective immediately, by the Borrowing Base values in excess of such five percent (5%) threshold; provided, further, that for purposes of the foregoing proviso, (A) a commodity Swap Agreement shall be deemed to have not been unwound or terminated if, (x) such commodity Swap Agreement is novated from the existing counterparty to an Approved Counterparty, with the Borrower or the applicable Credit Party being Restricted Subsidiary shall, to the “remaining party” for purposes extent the Borrower is not then in compliance with Section 8.13, provide title information reasonably requested by the Administrative Agent with respect to, and, to the extent the Borrower is not then in compliance with Section 8.14, grant a first-priority Lien (provided that Excepted Liens of the type described in clauses (a), (b), (c), (d), (f) and (m) of the definition thereof may exist, but subject to the provisos at the end of such novationdefinition) on, or (y) upon its termination or unwinding, it is replaced, in a substantially contemporaneous transaction, with one or more commodity Swap Agreements with the same or longer tenor, covering volumes not less than and for prices not less than those Swap Agreements being replaced and without cash payments to any Credit Party in connection therewith, and (B) an Oil and Gas Property shall be deemed to have not been Transferred if upon its Transfer, it is replaced, in a substantially contemporaneous transaction, with proved Oil and Gas Properties with approximately the same PV-9 value as acquired in such exchange pursuant to Security Instruments in form and substance reasonably determined by Borrower in good faith and evidenced by delivery satisfactory to the Administrative Agent of a certificate of a Responsible Officer containing reasonably detailed supporting information and in sufficient executed (and acknowledged where necessary or appropriate) counterparts for such good faith determinationrecording purposes; provided that, this clause (B) shall only apply and may only be relied on to the extent that the Oil and Gas Properties so Transferred consideration received in exchange for other Oil and Gas Properties in any period between two successive Scheduled Redetermination Dates does not exceed seven and one-half percent (7.5%) respect of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent). For the purposes of the preceding sentence, the Transfer of an E&P Credit Party owning such Oil and Gas Properties and/or commodity Swap Agreements pursuant to this Section 9.10(e) Disposition or Liquidation shall be deemed equal to or greater than the Transfer fair market value of the Oil and Gas Properties and the unwinding Property, interest therein, Restricted Subsidiary or termination Swap Agreement, as applicable, subject of such Disposition or Liquidation as reasonably determined by a Responsible Officer of the commodity Swap Agreements owned Borrower; (C) the Borrowing Base shall be reduced, effective immediately upon such Disposition or Liquidation, by an amount and to the extent required by Section 2.07(e); and (D) if any such E&P Credit PartyDisposition is of a Restricted Subsidiary owning Oil and Gas Properties, such Disposition shall include all the Equity Interests of such Restricted Subsidiary;
(e) transfers of Properties from (i) the Borrower and/or its Restricted Subsidiaries to the Borrower and/or any Guarantor; provided that after giving effect thereto, the Loan Parties are in compliance with Section 8.14 without giving effect to any grace periods or times for compliance set forth in such section and (ii) any Restricted Subsidiary that is not a Guarantor to any other Restricted Subsidiary that is not a Guarantor;
(f) Transfers Casualty Events;
(g) Dispositions of the non-cash portion of consideration (other than any Oil and Gas Properties) received for any Disposition permitted by this Section 9.12; provided that the consideration received in connection with respect of such Disposition shall be cash or Cash Equivalents and for fair market value;
(h) Restricted Payments permitted by Section 9.04 and Investments permitted by Section 9.05, other than Transfers of ;
(i) [Reserved];
(j) Sales, transfers, leases and Dispositions of Properties (other than (i) Dispositions of any Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base or any interest therein or any Restricted Subsidiary owning Oil and Gas Properties or (ii) any Equity Interests in any E&P Credit Party owning Proved Oil Liquidations of Swap Agreements) having a fair market value not to exceed the greater of (x) $10,000,000 and Gas Properties evaluated in the Reserve Report used in the most recent determination (y) 7.5% of the then-effective Borrowing BaseBase during any 12-month period;
(k) Dispositions of water assets, surface rights and other Property (excluding cash, Cash Equivalents, Hydrocarbon Interests and Borrowing Base Properties) which is primarily related to the water supply business of KMF Water, LLC; and
(gl) Transfers So long as Section 3 of Properties among the Credit Parties▇▇▇▇▇▇ Side Letter is in effect pursuant to the terms of Section 7 of the ▇▇▇▇▇▇ Side Letter, Dispositions of the Specified ORRI pursuant to the terms of the ▇▇▇▇▇▇ Side Letter; provided that (i) substantially contemporaneously with the closing of any such exchange (or such longer period as the Administrative Agent may agree in writing in its sole discretion), the Borrower or the applicable Restricted Subsidiary shall, to the extent the Borrower is not then in compliance with Section 8.13, provide title information reasonably requested by the Administrative Agent with respect to, and, to the extent the Borrower is not then in compliance with Section 8.14, grant a first-priority Lien (provided that Excepted Liens of the type described in clauses (a), (b), (c), (d), (f) and (m) of the definition thereof may exist, but subject to the provisos at the end of such definition) on, any Transfers of Equity Interests proved Oil and Gas Properties acquired in any E&P Credit Party, such exchange pursuant to Security Instruments in form and substance reasonably satisfactory to the requirements of Section 8.14(bAdministrative Agent and in sufficient executed (and acknowledged where necessary or appropriate) are satisfied counterparts for recording purposes and (ii) with respect to any Transfers of Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing BaseBase shall be reduced, the transferee promptly delivers mortgages or other Security Instruments in favor of the Administrative Agent effectively immediately upon such Disposition, by an amount and to the extent necessary to satisfy the requirements of required by Section 8.142.07(e).
Appears in 1 contract
Sale of Properties. The Borrower Each Credit Party will not, nor and will it not permit any other Credit Party Subsidiary to, sell, assign, make an Asset Sale or farm-outout any Property except (a) with respect to Asset Sales other than Casualty Events, convey where cash payment at least equal to the Fair Market Value of the asset sold is received contemporaneously with such Asset Sale; and (b) for (i) sales or otherwise transfer other dispositions (collectively in this section, “Transfer”including Casualty Events) any of Oil and Gas Property Properties or any interest in Hydrocarbons produced interests therein or to be produced therefrom or any Equity Interest in any Credit Party that owns any Subsidiaries owning Oil and Gas PropertyProperties to which there were no reserves attributed in the Reserve Report most recently delivered to the Lenders, commodity Swap Agreement or any interest in Hydrocarbons produced or to be produced therefrom (in this section, an “E&P Credit Party”) or unwind or terminate any commodity Swap Agreements, except for:
(aii) the sale of Hydrocarbons in the ordinary course of business;
(b) farmouts, swaps or trades of undeveloped acreage not included in the most recently delivered Reserve Report and assignments in connection with such farmouts, swaps or trades;
(c) the Transfer transfer of equipment that is no longer necessary for the business of the Borrower such Credit Party or such other Credit Party Subsidiary or is replaced by equipment of at least comparable value and use, and (iii) sales or use;
other dispositions (dincluding Casualty Events) Transfers of Oil and Gas Properties that are not Proved (other than those Oil & Gas Properties described in clause (a) above) or any interest therein or Subsidiaries owning Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base;
(i) Transfers of other than those Oil and & Gas Properties that comprise Proved Oil and Gas Properties evaluated described in the Reserve Report used in the most recent determination of the Borrowing Base, provided that such Transfers are for fair market value, (ii) the unwinding or termination of commodity Swap Agreements; or (iii) Transfers of all (but not less than all) of the Equity Interests collectively owned by the Borrower and its Subsidiaries in any E&P Credit Party; provided that in the case of clause (i) or (ii) above); provided that, except with respect to any novation or replacement, as applicable, contemplated by the final proviso of this Section 9.10(e), at least seventy-five percent (75%) (or such greater percentage as may be required to eliminate any resulting Borrowing Base Deficiency) of the consideration received in respect of such sale or other disposition or unwinding or termination, as applicable, shall be cash or cash equivalents; provided, further, that to the extent that, if during any period commencing with the later of the most recent Scheduled Redetermination Date or the most recent adjustment to the Borrowing Base pursuant to this Section 9.10 through the next Scheduled Redetermination Date, Oil and Gas Properties and commodity Swap Agreements with an aggregate Borrowing Base value in excess of five percent clause (5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agentiii), are Transferred or unwound or terminated, as applicable, by any one or more Credit Parties pursuant to this Section 9.10(e), then the Borrowing Base will be reduced, effective immediately, by the Borrowing Base values in excess of such five percent (5%) threshold; provided, further, that for purposes of the foregoing proviso, (A) such Asset Sales may be made if the Net Cash Proceeds thereof are used to repay Debt under the First Lien Credit Agreement to the extent payments are required due to a commodity Swap reduction in the borrowing base thereunder (and such payments shall no longer be required once prepayments under the First Lien Credit Agreement shall be deemed have reduced the outstandings thereunder to have not been unwound or terminated if, (x) such commodity Swap Agreement is novated from no more than 75% of the existing counterparty to an Approved Counterparty, with then-current Borrowing Base of each tranche of the Borrower or the applicable Credit Party being the “remaining party” for purposes of such novation, or (y) upon its termination or unwinding, it is replaced, in a substantially contemporaneous transaction, with one or more commodity Swap Agreements with the same or longer tenor, covering volumes not less than and for prices not less than those Swap Agreements being replaced and without cash payments to any Credit Party in connection therewithFirst Lien Facilities), and (B) an Oil and Gas Property shall be deemed to have not been Transferred if upon its Transfer, it is replaced, except as provided in a substantially contemporaneous transaction, with Oil and Gas Properties with approximately the same PV-9 value as reasonably determined by Borrower in good faith and evidenced by delivery to the Administrative Agent of a certificate of a Responsible Officer containing reasonably detailed supporting information for such good faith determination; provided that, this clause (BA) shall only apply and may only be relied on to above, the extent that the Oil and Gas Properties so Transferred in exchange for other Oil and Gas Properties in any period between two successive Scheduled Redetermination Dates does not exceed seven and one-half percent (7.5%) of the Borrowing Base present value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent). For the purposes of the preceding sentence, the Transfer of an E&P Credit Party owning such Oil and Gas Properties and/or commodity Swap Agreements pursuant to this Section 9.10(e) sold during a given Fiscal Year shall be deemed not exceed 10% of the Transfer Proven Present Value of the Oil and Gas Properties of such Credit Party and the unwinding its Subsidiaries; provided, further that, if any such sale or termination other disposition is of the commodity Swap Agreements owned by such E&P Credit Party;
(f) Transfers in connection with Investments permitted by Section 9.05, other than Transfers of (i) any Proved a Subsidiary owning Oil and Gas Properties evaluated in Properties, such sale or other disposition shall include all the Reserve Report used in the most recent determination of the Borrowing Base or (ii) any Equity Interests in of any E&P Credit Party owning Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base; and
(g) Transfers of Properties among the Credit Parties; provided that (i) with respect to any Transfers of Equity Interests in any E&P Credit Party, the requirements of Section 8.14(b) are satisfied and (ii) with respect to any Transfers of Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, the transferee promptly delivers mortgages or other Security Instruments in favor of the Administrative Agent to the extent necessary to satisfy the requirements of Section 8.14such Subsidiary.
Appears in 1 contract
Sources: Second Lien Credit and Guarantee Agreement (Endeavour International Corp)
Sale of Properties. The Borrower Each of the Loan Parties will not, nor and will it not permit any other Credit Party of its Subsidiaries to, sell, assign, farm-out, convey or otherwise transfer (collectively in this section, “Transfer”) or Dispose of any Oil and Gas Property or any interest in Hydrocarbons produced or to be produced therefrom or any Equity Interest in any Credit Party that owns any Oil and Gas Property, commodity Swap Agreement or any interest in Hydrocarbons produced or to be produced therefrom (in this section, an “E&P Credit Party”) or unwind or terminate any commodity Swap Agreements, except for:
(a) the sale of Hydrocarbons inventory in the ordinary course of business;
(b) farmoutsworn-out, swaps obsolete or trades of undeveloped acreage not included surplus equipment that is, in the most recently delivered Reserve Report reasonable judgment of ▇▇▇▇▇▇▇▇, no longer economically practical to maintain or used or useful in the ordinary course of business of Borrower or which is replaced by equipment of equal suitability and assignments in connection with such farmouts, swaps or tradesvalue;
(c) the Transfer of equipment that is no longer necessary for the business of the Borrower Dispositions to a Loan Party (other than Dispositions by IPCo or such other Credit Party or is replaced by equipment of at least comparable value or useIPHoldCo);
(d) Transfers Dispositions (other than of Oil and Gas Properties that are Intellectual Property) resulting from any Condemnation Event or Casualty Event;
(e) other Dispositions of Property of fair market value not Proved Oil and Gas Properties evaluated exceeding $4,000,000 in the Reserve Report used aggregate during any calendar year for which the applicable Loan Party or Subsidiary receives at least 75% of the consideration therefor in the most recent determination form of cash or Cash Equivalents; provided, that the Net Cash 75 102120121 Proceeds of such Disposition shall be subject to Section 3.04(c) to the extent such Property constitutes Collateral;
(f) Dispositions of cash or Cash Equivalents in the ordinary course of business;
(g) Dispositions in the ordinary course of business that consist of write-offs or grants of discounts or forgiveness of accounts receivable, without recourse, which are at least ninety (90) days past due in connection with the compromise or collection thereof;
(h) to the extent constituting a Disposition, non-exclusive licenses (including but not limited to those permitted under Section 10.03), sublicenses, bailment, leases or other subleases granted to third parties in the ordinary course of business and not interfering in any material respect with the business of the Borrowing BaseLoan Parties or any of their Subsidiaries, including the Intercompany IP Licensing Agreement;
(i) Transfers Dispositions in connection with the settlement of Oil claims or disputes and Gas Properties that comprise Proved Oil the settlement, release or surrender of tort or other litigation claims upon terms and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, provided that such Transfers are for fair market value, (ii) the unwinding or termination of commodity Swap Agreements; or (iii) Transfers of all (but not less than all) of the Equity Interests collectively owned conditions determined by the Borrower and in its Subsidiaries in any E&P Credit Partygood faith business judgment; provided that in the case of clause and
(ij) or (ii) above, except with respect to any novation or replacement, as applicable, contemplated by the final proviso of this Section 9.10(e), at least seventy-five percent (75%) (or such greater percentage as may be required to eliminate any resulting Borrowing Base Deficiency) of the consideration received in respect of such sale or other disposition or unwinding or termination, as applicable, shall be cash or cash equivalents; provided, further, that to the extent that, if during any period commencing with the later of the most recent Scheduled Redetermination Date or the most recent adjustment to the Borrowing Base pursuant to this Restricted Payments and Investments permitted under Section 9.10 through the next Scheduled Redetermination Date10.04 and Section 10.05, Oil and Gas Properties and commodity Swap Agreements with an aggregate Borrowing Base value in excess of five percent (5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent), are Transferred or unwound or terminated, as applicable, by any one or more Credit Parties pursuant to this Section 9.10(e), then the Borrowing Base will be reduced, effective immediately, by the Borrowing Base values in excess of such five percent (5%) threshold; provided, further, that for purposes of the foregoing proviso, (A) a commodity Swap Agreement shall be deemed to have not been unwound or terminated if, (x) such commodity Swap Agreement is novated from the existing counterparty to an Approved Counterparty, with the Borrower or the applicable Credit Party being the “remaining party” for purposes of such novation, or (y) upon its termination or unwinding, it is replaced, in a substantially contemporaneous transaction, with one or more commodity Swap Agreements with the same or longer tenor, covering volumes not less than and for prices not less than those Swap Agreements being replaced and without cash payments to any Credit Party in connection therewith, and (B) an Oil and Gas Property shall be deemed to have not been Transferred if upon its Transfer, it is replaced, in a substantially contemporaneous transaction, with Oil and Gas Properties with approximately the same PV-9 value as reasonably determined by Borrower in good faith and evidenced by delivery to the Administrative Agent of a certificate of a Responsible Officer containing reasonably detailed supporting information for such good faith determinationrespectively; provided that, this clause (B) shall only apply and may only be relied on to the extent any such Disposition is of assets or properties that the Oil and Gas Properties so Transferred in exchange for other Oil and Gas Properties in otherwise would be subject to any period between two successive Scheduled Redetermination Dates does not exceed seven and one-half percent (7.5%) of the Borrowing Base value of all Oil and Gas Properties included conditions set forth in the Borrowing Base other subsections of the Credit Parties (as reasonably determined by the Administrative Agent). For the purposes of the preceding sentence, the Transfer of an E&P Credit Party owning such Oil and Gas Properties and/or commodity Swap Agreements pursuant to this Section 9.10(e10.10, such Disposition shall likewise be subject to such conditions. Notwithstanding anything to the contrary in this Section 10.10, no Loan Party shall, nor shall it permit any Subsidiary to, directly or indirectly, (1) shall be deemed the Transfer Dispose of the Oil and Gas Properties and the unwinding or termination of the commodity Swap Agreements any Intellectual Property owned by such E&P Credit Party;
any Loan Party to any Person other than IPCo, or (f2) Transfers in connection with Investments permitted by Section 9.05grant to any Person other than a Loan Party any license or sublicense of any Intellectual Property, other than Transfers licenses or sublicenses permitted under subparagraph (h) of (i) any Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base or (ii) any Equity Interests in any E&P Credit Party owning Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base; and
(g) Transfers of Properties among the Credit Parties; provided that (i) with respect to any Transfers of Equity Interests in any E&P Credit Party, the requirements of this Section 8.14(b) are satisfied and (ii) with respect to any Transfers of Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, the transferee promptly delivers mortgages or other Security Instruments in favor of the Administrative Agent to the extent necessary to satisfy the requirements of Section 8.1410.10.
Appears in 1 contract
Sources: Senior Secured Term Loan Credit Agreement (Soundhound Ai, Inc.)
Sale of Properties. The Borrower will not, nor and will it not permit any other Credit Party Subsidiary to, sell, assign, farm-out, convey or otherwise transfer (collectively in this section, “Transfer”) any Oil and Gas Property or any interest in Hydrocarbons produced or to be produced therefrom or any Equity Interest in any Credit Party that owns any Oil and Gas Property, commodity Swap Agreement or any interest in Hydrocarbons produced or to be produced therefrom (in this section, an “E&P Credit Party”) or unwind or terminate any commodity Swap Agreements, except for:
(a) dispositions of cash and cash equivalents in the ordinary course of business and in connection with the consummation of the Specified Transactions and other transactions permitted by this Agreement;
(b) the sale of Hydrocarbons inventory in the ordinary course of business;
(b) farmouts, swaps or trades of undeveloped acreage not included in the most recently delivered Reserve Report and assignments in connection with such farmouts, swaps or trades;
(c) the Transfer sale or transfer of equipment that is obsolete or worn out property and property no longer necessary for used or useful in the conduct of the business of the Borrower and its Subsidiaries, whether now owned or such other Credit Party hereafter acquired, in the ordinary course of business or is replaced by equipment replacement property of at least comparable value or and use;
(d) Transfers issuances of Oil distributions or other Restricted Payments permitted pursuant to Section 9.04;
(e) Restricted Payments permitted by Section 9.04 and Gas Properties Liens permitted by Section 9.03;
(f) the transfer of Property to another Loan Party;
(g) the transfer of Property to an Excluded Subsidiary, provided that are not Proved Oil (i) no Default exists at the time of or after giving effect to such transfer, and Gas Properties evaluated (ii) such transfer is deemed to be an Investment in such Excluded Subsidiary in an amount equal to the Reserve Report used in the most recent determination fair market value of the Borrowing BaseProperty transferred as of the date of such transfer and such Investment would be permitted to be made at the time of such transfer under Section 9.05(n);
(h) the transfer of Property occurring in connection with a transaction permitted by, and made in compliance with the provisions of, Section 9.10;
(i) Transfers of Oil and Gas Properties that comprise Proved Oil and Gas Properties evaluated Asset Sales having, in the Reserve Report used aggregate for all Asset Sales by the Borrower or any Subsidiary, a fair market value not to exceed $5,000,000 during any fiscal year of the Borrower;
(j) other Asset Sales, subject to Section 3.04(b)(ii);
(k) dispositions of accounts receivables in connection with the collection or compromise thereof in the most recent determination ordinary course of business to the Borrowing Baseextent permitted under Section 9.09;
(l) grants of Leases, provided that such Transfers are for fair market valuesubleases, licenses or sublicenses (ii) including the unwinding provision of software under an open source license), easements, rights of way or termination similar rights or encumbrances in each case in the ordinary course of commodity Swap Agreements; or (iii) Transfers business and which do not materially interfere with the business of all (but not less than all) of the Equity Interests collectively owned by the Borrower and its Subsidiaries in any E&P Credit Party; provided that in the case of clause (i) or (ii) above, except with respect to any novation or replacement, as applicable, contemplated by the final proviso of this Section 9.10(e), at least seventy-five percent (75%) (or such greater percentage as may be required to eliminate any resulting Borrowing Base Deficiency) of the consideration received in respect of such sale or other disposition or unwinding or termination, as applicable, shall be cash or cash equivalents; provided, further, that to the extent that, if during any period commencing with the later of the most recent Scheduled Redetermination Date or the most recent adjustment to the Borrowing Base pursuant to this Section 9.10 through the next Scheduled Redetermination Date, Oil and Gas Properties and commodity Swap Agreements with an aggregate Borrowing Base value in excess of five percent (5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent), are Transferred or unwound or terminated, as applicable, by any one or more Credit Parties pursuant to this Section 9.10(e), then the Borrowing Base will be reduced, effective immediately, by the Borrowing Base values in excess of such five percent (5%) threshold; provided, further, that for purposes of the foregoing proviso, (A) a commodity Swap Agreement shall be deemed to have not been unwound or terminated if, (x) such commodity Swap Agreement is novated from the existing counterparty to an Approved Counterparty, with the Borrower or the applicable Credit Party being the “remaining party” for purposes of such novation, or (y) upon its termination or unwinding, it is replaced, in a substantially contemporaneous transaction, with one or more commodity Swap Agreements with the same or longer tenor, covering volumes not less than and for prices not less than those Swap Agreements being replaced and without cash payments to any Credit Party in connection therewith, and (B) an Oil and Gas Property shall be deemed to have not been Transferred if upon its Transfer, it is replaced, in a substantially contemporaneous transaction, with Oil and Gas Properties with approximately the same PV-9 value as reasonably determined by Borrower in good faith and evidenced by delivery to the Administrative Agent of a certificate of a Responsible Officer containing reasonably detailed supporting information for such good faith determination; provided that, this clause (B) shall only apply and may only be relied on to the extent that the Oil and Gas Properties so Transferred in exchange for other Oil and Gas Properties in any period between two successive Scheduled Redetermination Dates does not exceed seven and one-half percent (7.5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent). For the purposes of the preceding sentence, the Transfer of an E&P Credit Party owning such Oil and Gas Properties and/or commodity Swap Agreements pursuant to this Section 9.10(e) shall be deemed the Transfer of the Oil and Gas Properties and the unwinding or termination of the commodity Swap Agreements owned by such E&P Credit Party;
(f) Transfers in connection with Investments permitted by Section 9.05, other than Transfers of (i) any Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base or (ii) any Equity Interests in any E&P Credit Party owning Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing BaseSubsidiaries; and
(gm) Transfers transfers of Properties among the Credit Parties; provided Property that (i) with respect to any Transfers of Equity Interests in any E&P Credit Party, the requirements of Section 8.14(b) are satisfied and (ii) with respect to any Transfers of Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination has suffered a Casualty Event upon receipt of the Borrowing Base, the transferee promptly delivers mortgages or other Security Instruments in favor Net Cash Proceeds of the Administrative Agent to the extent necessary to satisfy the requirements of Section 8.14such Casualty Event.
Appears in 1 contract
Sources: Revolving Credit Agreement (Southcross Energy Partners, L.P.)
Sale of Properties. The Borrower It will not, nor and will it not permit any other Credit Party of its Restricted Subsidiaries to, sell, lease, assign, farm-outexchange, convey or otherwise transfer (collectively in this section, “Transfer”excluding the granting of a Lien) any Oil and Gas Property or to any interest in Hydrocarbons produced Person other than to it or to be produced therefrom or any Equity Interest in any Credit Party that owns any Oil and Gas Property, commodity Swap Agreement or any interest in Hydrocarbons produced or to be produced therefrom (in this section, an “E&P Credit Party”) or unwind or terminate any commodity Swap Agreementsof its Restricted Subsidiaries, except forit and any of its Restricted Subsidiaries:
(a) the sale may sell or otherwise dispose of Hydrocarbons any Property which, in the ordinary course reasonable judgment of such Person, is obsolete, worn out or otherwise no longer useful in the conduct of such Person’s business;
(b) farmoutsmay sell, swaps lease, assign, exchange, convey or trades of undeveloped acreage not included transfer inventory or equipment in the most recently delivered Reserve Report ordinary course of business (including any sale, lease, assignment, exchange, conveyance or transfer of Compression Assets to the UCLP Group pursuant to the Omnibus Agreement); provided, however, that when any sales, exchanges or conveyances result in the US Borrowers and assignments the Restricted Subsidiaries receiving more than $100,000,000 in connection Net Proceeds on a cumulative basis, fifty percent (50%) of Net Proceeds received in excess of $100,000,000 shall be applied to reduce the Aggregate Revolving Commitments as provided in Section 2.03(a) and the unused Commitment Increase as provided in Section 2.15(e). Notwithstanding the foregoing to the contrary, sales in accordance with such farmouts, swaps or trades;Section 10.14(e) shall not apply to this Section 10.14(b).
(c) the Transfer of equipment may sell, lease, assign, exchange, convey or otherwise transfer Compression Assets to an ABS Subsidiary so that is no longer necessary it may become collateral for the business of the Borrower or such other Credit Party or is replaced by equipment of at least comparable value or useABS Facility;
(d) Transfers so long as no Event of Oil Default has occurred and Gas Properties that are not Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination is continuing, may sell or otherwise dispose of Property having a value of up to 5% of the Borrowing BaseConsolidated Net Tangible Assets of it in any fiscal year;
(e) may sell Compression Assets to one or more members of the UCLP Group; provided that for any sale of more than $100,000,000 of Compression Assets not otherwise permitted by Section 10.14(b) (i) Transfers if the sales price for the Compression Assets is less than 7 times the EBITDA of Oil Holdings and Gas Properties that comprise Proved Oil and Gas Properties evaluated in its Consolidated Subsidiaries for the Reserve Report used in last 4 quarters attributable to such assets, the most recent determination US Borrowers will deliver to the Lenders a fairness opinion from a Person reasonably acceptable to the US Administrative Agent with respect to the value of the Borrowing Base, provided that consideration of such Transfers are for fair market valuesale, (ii) in the unwinding or termination event any fairness opinion is delivered to its board of commodity Swap Agreements; or directors in connection with such sale, a copy of which will be delivered to the Lenders, (iii) Transfers of all (but not less than all) at least 30% of the Equity Interests collectively owned by the Borrower and its Subsidiaries in any E&P Credit Party; provided that in the case of clause (i) or (ii) above, except with respect to any novation or replacement, as applicable, contemplated by the final proviso of this Section 9.10(e), at least seventy-five percent (75%) (or such greater percentage as may be required to eliminate any resulting Borrowing Base Deficiency) of the consideration received in respect of value for such sale or other disposition or unwinding or termination, as applicable, shall will be cash or cash equivalents; provided, further, that in LP Units conveyed to the extent that, if during any period commencing with the later of the most recent Scheduled Redetermination Date US Borrowers or the most recent adjustment to the Borrowing Base pursuant to this Section 9.10 through the next Scheduled Redetermination Date, Oil and Gas Properties and commodity Swap Agreements with an aggregate Borrowing Base value in excess of five percent (5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent), are Transferred or unwound or terminated, as applicable, by any one or more Credit Parties pursuant to this Section 9.10(e), then the Borrowing Base their Restricted Subsidiaries which units will be reduced, effective immediately, by the Borrowing Base values in excess of such five percent (5%) threshold; provided, further, that for purposes of the foregoing proviso, (A) a commodity Swap Agreement shall be deemed to have not been unwound or terminated if, (x) such commodity Swap Agreement is novated from the existing counterparty to an Approved Counterparty, with the Borrower or the applicable Credit Party being the “remaining party” for purposes of such novation, or (y) upon its termination or unwinding, it is replaced, in a substantially contemporaneous transaction, with one or more commodity Swap Agreements with the same or longer tenor, covering volumes not less than and for prices not less than those Swap Agreements being replaced and without cash payments to any Credit Party in connection therewith, pledged as Collateral and (Biv) an Oil and Gas Property shall be deemed no Default or Event of Default will occur after giving effect to have not been Transferred if upon its Transfer, it is replaced, in such sale on a substantially contemporaneous transaction, with Oil and Gas Properties with approximately the same PV-9 value as reasonably determined by Borrower in good faith and evidenced by delivery to the Administrative Agent of a certificate of a Responsible Officer containing reasonably detailed supporting information for such good faith determination; provided that, this clause (B) shall only apply and may only be relied on to the extent that the Oil and Gas Properties so Transferred in exchange for other Oil and Gas Properties in any period between two successive Scheduled Redetermination Dates does not exceed seven and one-half percent (7.5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent). For the purposes of the preceding sentence, the Transfer of an E&P Credit Party owning such Oil and Gas Properties and/or commodity Swap Agreements pursuant to this Section 9.10(e) shall be deemed the Transfer of the Oil and Gas Properties and the unwinding or termination of the commodity Swap Agreements owned by such E&P Credit Partypro forma basis;
(f) Transfers in connection with Investments permitted by may sell LP Units, IDRs, Subordinated Units and GP Interests, subject to the provisions of Section 9.05, other than Transfers of (i2.03(a) any Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base or (ii) any Equity Interests in any E&P Credit Party owning Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base; andSection 2.15(e);
(g) Transfers may sell all or substantially all of Properties among the Credit PartiesProperty or Capital Stock of any ABS Subsidiary to any Person comprising the UCLP Group; provided, however, (i) if the sales price for the Capital Stock is less than 7 times the EBITDA of Holdings and its Consolidated Subsidiaries for the last 4 quarters attributable to such ABS Subsidiary, the US Borrowers will deliver to the Lenders a fairness opinion from a Person reasonably acceptable to the US Administrative Agent with respect to the value of the consideration of such sale, (ii) in the event any fairness opinion is delivered to its board of directors in connection with such sale, a copy of which will be delivered to the Lenders, (iii) at least 30% of the value for such sale will be in LP Units conveyed to the US Borrowers or their Restricted Subsidiaries which units will be pledged as Collateral and (iv) no Default or Event of Default will occur after giving effect to such sale on a pro forma basis; and provided that (i) with respect to any Transfers (d) and (f) above, (y) fair market value is received and (z) no Default or Event of Equity Interests in any E&P Credit Party, the requirements of Section 8.14(b) are satisfied Default will occur after giving effect to such sale on a pro forma basis and (ii) with respect to any Transfers of Proved Oil (f) above, Holdings maintains, directly or indirectly, majority legal and Gas Properties evaluated in the Reserve Report used in the most recent determination beneficial ownership and voting control of the Borrowing BaseGeneral Partner, including the transferee promptly delivers mortgages or other Security Instruments in favor of GP Interests and the Administrative Agent to the extent necessary to satisfy the requirements of Section 8.14IDRs.
Appears in 1 contract
Sources: Senior Secured Credit Agreement (Universal Compression Holdings Inc)
Sale of Properties. The Borrower Issuer will not, nor and will it not permit any other Credit Note Party to, sell, assign, farm-out, convey or otherwise transfer Dispose of any Property (collectively in this section, “Transfer”including the Liquidation of any Swap Agreement) any Oil and Gas Property or any interest in Hydrocarbons produced or to be produced therefrom or any Equity Interest in any Credit Party that owns any Oil and Gas Property, commodity Swap Agreement or any interest in Hydrocarbons produced or to be produced therefrom (in this section, an “E&P Credit Party”) or unwind or terminate any commodity Swap Agreements, except for:
(a) the sale of Hydrocarbons and the lease of Oil and Gas Properties, in each case in the ordinary course of business;
(b) farmouts, swaps or trades farmouts in the ordinary course of business of Oil and Gas Properties consisting solely of undeveloped acreage not included or undrilled depths to which no proved reserves are attributed in the most recently delivered Reserve Report and assignments in connection with such farmoutsfarmouts or the abandonment, swaps farmout, trade, exchange, lease, sublease or tradesother Disposition in the ordinary course of business of Oil and Gas Properties not containing proved reserves and which are not included in the most recently delivered Reserve Report;
(c) the Transfer Disposition of equipment that is no longer necessary for the business of the Borrower Issuer or any such other Credit Note Party or is replaced by equipment of at least comparable value or and use;
(d) Transfers (i) the Disposition, other than as provided in Section 7.11(a) or Section 7.11(c), of any Oil and Gas Property or any interest therein or any Restricted Subsidiary owning Oil and Gas Properties that are not Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base;
(i) Transfers of Oil and Gas Properties that comprise Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, provided that such Transfers are for fair market value, or (ii) the unwinding or termination Liquidation of commodity any Swap Agreements; or (iii) Transfers of all (but not less Agreement other than all) of the Equity Interests collectively owned by the Borrower and its Subsidiaries in any E&P Credit PartyRequired Swap Agreement; provided that in the case of clause (i) or (ii) above, except with respect to any novation or replacement, as applicable, contemplated by the final proviso of this Section 9.10(e), at least seventy-five percent (75%) (or such greater percentage as may be required to eliminate any resulting Borrowing Base Deficiency) of the consideration received in respect of such sale Disposition or other disposition or unwinding or termination, as applicable, Liquidation shall be cash and Cash Equivalents, or cash equivalentssolely with respect to Liquidations, other Swap Agreements permitted by Section 7.17; providedprovided that, furtherwith respect to any Disposition, that notwithstanding the foregoing requirement of this clause (i) (but, for the avoidance of doubt, subject to the extent thatother terms and conditions of this Section 7.11(d)), if during any period commencing the Issuer and/or its Restricted Subsidiaries may exchange Hydrocarbon Interests for other Hydrocarbon Interests with the later of same or better reserve classification, reserve characteristics, reserve lives and decline profiles so long as (A) the most recent Scheduled Redetermination Date or the most recent adjustment to the aggregate Borrowing Base pursuant to this Section 9.10 through value, as determined by the next Scheduled Redetermination DateRBL Administrative Agent, of all proved Oil and Gas Properties of the Issuer and commodity Swap Agreements with an aggregate Borrowing Base value the Restricted Subsidiaries exchanged for such other proved Oil and Gas Properties during any period between two successive Scheduled Redeterminations (as defined in excess of five the RBL Credit Agreement) does not exceed two percent (52%) of the Borrowing Base value of all Oil and Gas Properties included then in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent)effect, are Transferred or unwound or terminated, as applicable, by any one or more Credit Parties pursuant to this Section 9.10(e), then the Borrowing Base will be reduced, effective immediately, by the Borrowing Base values in excess of such five percent (5%) threshold; provided, further, that for purposes of the foregoing proviso, (A) a commodity Swap Agreement shall be deemed to have not been unwound or terminated if, (x) such commodity Swap Agreement is novated from the existing counterparty to an Approved Counterparty, with the Borrower or the applicable Credit Party being the “remaining party” for purposes of such novation, or (y) upon its termination or unwinding, it is replaced, in a substantially contemporaneous transaction, with one or more commodity Swap Agreements with the same or longer tenor, covering volumes not less than and for prices not less than those Swap Agreements being replaced and without cash payments to any Credit Party in connection therewith, and (B) an Oil and Gas Property shall be deemed to have not been Transferred if upon its Transfer, it is replaced, in a substantially contemporaneous transaction, with Oil and Gas Properties with approximately the same PV-9 value as reasonably determined by Borrower in good faith and evidenced by delivery to the Administrative Agent of a certificate of a Responsible Officer containing reasonably detailed supporting information for such good faith determination; provided that, this clause (B) shall only apply and may only be relied on to the extent that a Borrowing Base Deficiency could result from an adjustment to the Oil and Gas Properties so Transferred in exchange for other Oil and Gas Properties in Borrowing Base resulting from such Disposition, after the consummation of such Disposition(s), the Issuer shall have received net cash proceeds, or shall have cash on hand, sufficient to eliminate any period between two successive Scheduled Redetermination Dates does not exceed seven and one-half percent (7.5%such potential Borrowing Base Deficiency pursuant to Section 3.04(c)(iii) of the Borrowing Base value RBL Credit Agreement; (ii) the consideration received in respect of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent). For the purposes of the preceding sentence, the Transfer of an E&P Credit Party owning such Oil and Gas Properties and/or commodity Swap Agreements pursuant to this Section 9.10(e) Disposition or Liquidation shall be deemed equal to or greater than the Transfer fair market value of the Oil and Gas Properties and the unwinding Property, interest therein or termination Restricted Subsidiary or Swap Agreement, as applicable, subject of such Disposition or Liquidation as reasonably determined by a Responsible Officer of the commodity Swap Agreements owned Issuer; (iii) the Borrowing Base shall be reduced, effective immediately upon such Disposition or Liquidation, by an amount and to the extent required by Section 2.07(e) of the RBL Credit Agreement; and (D) if any such E&P Credit PartyDisposition is of a Restricted Subsidiary owning Oil and Gas Properties, such Disposition shall include all the Equity Interests of such Restricted Subsidiary;
(fe) Transfers in connection with Investments permitted by Section 9.05, other than Transfers of Properties from (i) the Issuer and/or its Restricted Subsidiaries to the Issuer and/or any Proved Oil Guarantor; provided that after giving effect thereto, the Note Parties are in compliance with Section 6.13 without giving effect to any grace periods or times for compliance set forth in such section and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base or (ii) any Equity Interests in any E&P Credit Party owning Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base; and
(g) Transfers of Properties among the Credit Parties; provided Restricted Subsidiary that (i) with respect is not a Guarantor to any Transfers of Equity Interests in any E&P Credit Party, the requirements of Section 8.14(b) are satisfied and (ii) with respect to any Transfers of Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, the transferee promptly delivers mortgages or other Security Instruments in favor of the Administrative Agent to the extent necessary to satisfy the requirements of Section 8.14.Restricted Subsidiary that is not a Guarantor;
Appears in 1 contract
Sale of Properties. The Borrower will not, nor and will it not permit any other Credit Party Restricted Subsidiary to, sell, assign, farm-out, convey or otherwise transfer (collectively in this section, “Transfer”) any Oil and Gas Property or any interest in Hydrocarbons produced or to be produced therefrom or any Equity Interest in any Credit Party that owns any Oil and Gas Property, commodity Swap Agreement or any interest in Hydrocarbons produced or to be produced therefrom (in this section, an “E&P Credit Party”) or unwind or terminate any commodity Swap Agreements, except for:
(a) the sale of Hydrocarbons and geological and seismic data in the ordinary course of business;
(b) farmouts, swaps or trades farmouts of undeveloped acreage not included in the most recently delivered Reserve Report and assignments in connection with such farmouts, swaps or trades;
(c) the Transfer sale or transfer of equipment Property that is no longer necessary for the business of the Borrower or such other Credit Party or is replaced by equipment of at least comparable value or useRestricted Subsidiary;
(d) Transfers [reserved];
(e) the sale or other Disposition (including Casualty Events) of any Oil and Gas Property or any interest therein or any Restricted Subsidiary owning Oil and Gas Properties or the Unwind of Swap Agreements; provided that are not Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base;
(i) Transfers of Oil and Gas Properties that comprise Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, provided that such Transfers are for fair market value, (ii) the unwinding or termination of commodity Swap Agreements; or (iii) Transfers of all (but not less than all) of the Equity Interests collectively owned by the Borrower and its Subsidiaries in any E&P Credit Party; provided that in the case of clause (i) or (ii) above, except with respect to any novation or replacement, as applicable, contemplated by the final proviso of this Section 9.10(e), at least seventy-five percent (75%) (or such greater percentage as may be required to eliminate any resulting Borrowing Base Deficiency) % of the consideration received in respect of any such sale or other disposition or unwinding or termination, as applicable, Disposition shall be cash or cash equivalents; provided, further, that to the extent that, if during any period commencing with the later of the most recent Scheduled Redetermination Date or the most recent adjustment to the Borrowing Base pursuant to this Section 9.10 through the next Scheduled Redetermination Date, other Oil and Gas Properties and commodity Swap Agreements with an aggregate Borrowing Base Properties, (ii) the consideration received in respect of any such sale or other Disposition shall be equal to or greater than the fair market value in excess of five percent (5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent), are Transferred or unwound or terminated, as applicable, by any one or more Credit Parties pursuant to this Section 9.10(e), then the Borrowing Base will be reduced, effective immediately, by the Borrowing Base values in excess asset subject of such five percent (5%) threshold; providedsale or other Disposition, furtherand if such fair market value is greater than $2.5 million, that for purposes of the foregoing proviso, (A) a commodity Swap Agreement shall be deemed to have not been unwound or terminated if, (x) such commodity Swap Agreement is novated from the existing counterparty to an Approved Counterparty, with the Borrower or the applicable Credit Party being the “remaining party” for purposes of such novation, or (y) upon its termination or unwinding, it is replaced, in a substantially contemporaneous transaction, with one or more commodity Swap Agreements with the same or longer tenor, covering volumes not less than and for prices not less than those Swap Agreements being replaced and without cash payments to any Credit Party in connection therewith, and (B) an Oil and Gas Property shall be deemed to have not been Transferred if upon its Transfer, it is replaced, in a substantially contemporaneous transaction, with Oil and Gas Properties with approximately the same PV-9 value as reasonably determined by Borrower in good faith and evidenced by delivery to the Administrative Agent of deliver a certificate of a Responsible Officer containing of the Borrower certifying to the fair market value and that the board of directors of the Borrower has reasonably detailed supporting information for determined such, (iii) if any such good faith determination; provided thatsale or other Disposition is of a Restricted Subsidiary owning Oil and Gas Properties, such sale or other Disposition shall include all the Equity Interests owned by the Borrower and its Restricted Subsidiaries of such Restricted Subsidiary and (iv) the aggregate fair market value of all assets Disposed of pursuant to this clause (Be) shall only apply and may only be relied on to the extent that the Oil and Gas Properties so Transferred in exchange for other Oil and Gas Properties in any period between two successive Scheduled Redetermination Dates does not exceed seven and one-half percent (7.5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent). For the purposes of the preceding sentence, the Transfer of an E&P Credit Party owning such Oil and Gas Properties and/or commodity Swap Agreements pursuant to this Section 9.10(e) shall be deemed the Transfer of the Oil and Gas Properties and the unwinding or termination of the commodity Swap Agreements owned by such E&P Credit Party$5.0 million;
(f) Transfers in connection with Investments permitted by Section 9.05, sales and other than Transfers transfers of (i) Properties between the Borrower and any Proved Oil Restricted Subsidiary or between any Restricted Subsidiary and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base or (ii) any Equity Interests in any E&P Credit Party owning Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Baseother Restricted Subsidiary; and
(g) Transfers if no Default or Event of Default then exists, sales and other dispositions of Properties among the Credit Parties; provided that (i) with respect not otherwise permitted above having a fair market value not to exceed $2.0 million during any Transfers of Equity Interests in any E&P Credit Party, the requirements of Section 8.14(b) are satisfied and (ii) with respect to any Transfers of Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, the transferee promptly delivers mortgages or other Security Instruments in favor of the Administrative Agent to the extent necessary to satisfy the requirements of Section 8.1412 month period.
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Sources: Junior Secured Debtor in Possession Credit Agreement (Halcon Resources Corp)
Sale of Properties. The Borrower will not, nor and will it not permit any other Credit Party of its Subsidiaries to, sell, assign, farm-out, convey or otherwise transfer (collectively in this section, “Transfer”) any Oil and Gas Property or any interest in Hydrocarbons produced or to be produced therefrom or any Equity Interest in any Credit Party that owns any Oil and Gas Property, commodity Swap Agreement or any interest in Hydrocarbons produced or to be produced therefrom (in this section, an “E&P Credit Party”) or unwind or terminate any commodity Swap Agreements, except for:
(a) the sale of Hydrocarbons in the ordinary course of business;
(b) farmouts, swaps or trades farmouts of undeveloped acreage not included in the most recently delivered Reserve Report and assignments in connection with such farmouts, swaps farmouts (i) pursuant to the terms of the TPG Development Agreement and solely comprising TPG JD Subject Assets (as such term is defined on the Effective Date) or trades(ii) with respect to which the Borrower or a Subsidiary retains an overriding royalty interest above a 75% net revenue interest in such disposed Property;
(c) the Transfer sale or transfer of equipment that is no longer necessary for the business of the Borrower or such other Credit Party Subsidiary or is replaced by equipment of at least comparable value and use; provided that the total fair market value of such equipment being sold or usetransferred does not exceed $250,000 during any 12-month period;
(d) Transfers [Reserved];
(e) [Reserved];
(f) sales and other dispositions of Oil and Gas Properties that are not Proved Oil and Gas Properties evaluated regulated by Section 9.12(a) to (e) having a total fair market value not to exceed $500,000 during any 12-month period;
(g) sales or other dispositions of any Equity Interests in the Reserve Report used in the most recent determination of the Borrowing Base;an E&P Subsidiary; and
(h) any other disposition so long as:
(i) Transfers no Default or Event of Oil and Gas Properties that comprise Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, provided that such Transfers are for fair market value, Default is occurring or would result therefrom;
(ii) the unwinding Borrower or termination Subsidiary, as the case may be, receives consideration at the time of commodity Swap Agreements; such disposition at least equal to the fair market value of the assets sold or otherwise disposed of;
(iii) Transfers in the case of all dispositions with respect to which the total consideration received is greater than or equal to $1,000,000, then at least 75% of the consideration received by the Borrower or such Subsidiary, as the case may be, therefrom is in the form of cash or Cash Equivalents; provided that, to the extent such disposition consists of non-cash consideration received by Borrower or its subsidiaries, such non-cash consideration that constitutes any property will be mortgaged pursuant to the Term Loan Security Instruments; and
(but iv) within 365 days after the receipt of any Net Cash Proceeds from a disposition made pursuant to Section 9.12(h) only, and not less for any other dispositions, the Borrower or applicable Subsidiary may apply such Net Cash Proceeds:
(1) to repay any RBL Facility and permanently reduce the commitments or the Borrowing Base thereunder in equal amount, or
(2) in aggregate amount not to exceed $75,000,000 in the aggregate from and after the Effective Date:
(A) to invest or reinvest in any assets or property that are not classified as current assets under GAAP and that are used or useful in the business of the Borrower and its Subsidiaries or any business ancillary thereto; or
(B) to make capital expenditures; (for the avoidance of doubt, it is agreed and understood that prior to making any such reinvestment or making any such capital expenditure under clause (iv)(2)(A) or (B) above, the Borrower and its Subsidiaries may first apply any such Net Cash Proceeds to any RBL Facility) provided that Borrower shall deliver a notice of its intent to reinvest Net Cash Proceeds from the Disposition a “Reinvestment Notice” to the Administrative Agent and the Lenders within 5 Business Days of the receipt by the Borrower or any Guarantor of such Net Cash Proceeds. Net Cash Proceeds from Dispositions that are not applied or invested as provided in this section shall constitute “ Excess Cash Proceeds ” and shall be applied in accordance with Section 3.04(c)(iv). Notwithstanding anything in this Agreement or in any Term Loan Document to the contrary, the Borrower will not, directly or indirectly, sell or otherwise dispose of any Equity Interests in any Subsidiary other than all) an E&P Subsidiary or a Subsidiary that is not a Material Domestic Subsidiary, unless such sale or other disposition is of 100% of the Equity Interests collectively Interest owned by the Borrower and its Subsidiaries in any E&P Credit Party; provided that in the case of clause (i) or (ii) above, except with respect to any novation or replacement, as applicable, contemplated by the final proviso of this Section 9.10(e), at least seventy-five percent (75%) (or such greater percentage as may be required to eliminate any resulting Borrowing Base Deficiency) of the consideration received in respect of such sale or other disposition or unwinding or termination, as applicable, shall be cash or cash equivalents; provided, further, that to the extent that, if during any period commencing with the later of the most recent Scheduled Redetermination Date or the most recent adjustment to the Borrowing Base pursuant to this Section 9.10 through the next Scheduled Redetermination Date, Oil and Gas Properties and commodity Swap Agreements with an aggregate Borrowing Base value in excess of five percent (5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent), are Transferred or unwound or terminated, as applicable, by any one or more Credit Parties pursuant to this Section 9.10(e), then the Borrowing Base will be reduced, effective immediately, by the Borrowing Base values in excess of such five percent (5%) threshold; provided, further, that for purposes of the foregoing proviso, (A) a commodity Swap Agreement shall be deemed to have not been unwound or terminated if, (x) such commodity Swap Agreement is novated from the existing counterparty to an Approved Counterparty, with the Borrower or the applicable Credit Party being the “remaining party” for purposes of such novation, or (y) upon its termination or unwinding, it is replaced, in a substantially contemporaneous transaction, with one or more commodity Swap Agreements with the same or longer tenor, covering volumes not less than and for prices not less than those Swap Agreements being replaced and without cash payments to any Credit Party in connection therewith, and (B) an Oil and Gas Property shall be deemed to have not been Transferred if upon its Transfer, it is replaced, in a substantially contemporaneous transaction, with Oil and Gas Properties with approximately the same PV-9 value as reasonably determined by Borrower in good faith and evidenced by delivery to the Administrative Agent of a certificate of a Responsible Officer containing reasonably detailed supporting information for such good faith determination; provided that, this clause (B) shall only apply and may only be relied on to the extent that the Oil and Gas Properties so Transferred in exchange for other Oil and Gas Properties in any period between two successive Scheduled Redetermination Dates does not exceed seven and one-half percent (7.5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent). For the purposes of the preceding sentence, the Transfer of an E&P Credit Party owning such Oil and Gas Properties and/or commodity Swap Agreements pursuant to this Section 9.10(e) shall be deemed the Transfer of the Oil and Gas Properties and the unwinding or termination of the commodity Swap Agreements owned by such E&P Credit Party;
(f) Transfers in connection with Investments permitted by Section 9.05, other than Transfers of (i) any Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base or (ii) any Equity Interests in any E&P Credit Party owning Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base; and
(g) Transfers of Properties among the Credit Parties; provided that (i) with respect to any Transfers of Equity Interests in any E&P Credit Party, the requirements of Section 8.14(b) are satisfied and (ii) with respect to any Transfers of Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, the transferee promptly delivers mortgages or other Security Instruments in favor of the Administrative Agent to the extent necessary to satisfy the requirements of Section 8.14Subsidiary.
Appears in 1 contract
Sale of Properties. The Borrower Borrowers will not, nor and will it not permit any other Credit Party Subsidiary to, sell, assign, farm-out, convey or otherwise transfer (collectively in this section, “Transfer”) any Oil and Gas Property or any interest in Hydrocarbons produced or to be produced therefrom or any Equity Interest in any Credit Party that owns any Oil and Gas Property, commodity Swap Agreement or any interest in Hydrocarbons produced or to be produced therefrom (in this section, an “E&P Credit Party”) or unwind or terminate any commodity Swap Agreements, Properties containing proved reserves constituting a portion of the Borrowing Base except for:
(a) the sale of Hydrocarbons in the ordinary course of business;
(b) farmouts, swaps sales or trades other dispositions (including, asset swaps) of undeveloped acreage not included in the most recently delivered Reserve Report and assignments in connection with such farmouts, swaps or tradestransactions;
(c) the Transfer sale or transfer of equipment in the ordinary course of business or that is no longer necessary for the business of the Borrower Borrowers or such other Credit Party Subsidiary or is replaced by equipment of at least comparable value or and use;
(d) Transfers the sale or other disposition of any Oil and Gas Properties that are not Proved of the Borrowers and the Guarantor; provided, that:
(i) no Event of Default has occurred and is continuing;
(ii) there is no Borrowing Base Deficiency at the time of such sale or disposition;
(iii) the aggregate value (which, for purposes hereof, shall mean the value the Lender attributes to such Oil and Gas Property for purposes of the most recent redetermination of the Borrowing Base) of such Oil and Gas Properties evaluated sold or disposed of pursuant to this Section 9.12(d) in the Reserve Report used in the most recent determination any period between Scheduled Redeterminations shall not exceed five percent (5%) of the Borrowing Base;Base then in effect; and
(iv) no sale or other disposition shall be permitted pursuant to this clause (d) unless all mandatory prepayments required by Section 3.04(c)(iii) are made concurrently therewith.
(e) the sale or other disposition (including Casualty Events) of any Oil and Gas Properties of the Borrowers and the Guarantor or any interest therein (including any Equity Interest in any Credit Party that owns Oil and Gas Property, but excluding transfers of interests in Energy 12 LP by limited partners thereof that do not result in a change in the managers of Energy 12 Operating); provided, that:
(i) Transfers no Event of Oil Default has occurred and Gas Properties that comprise Proved Oil and Gas Properties evaluated in is continuing;
(ii) Borrowers shall have provided the Reserve Report used in Lender no less than ten (10) days written notice prior to the most recent determination date of such sale setting forth the terms of the sale and, during such ten (10) day period, Lender may, if so desired, redetermine the Borrowing Base, provided that such Transfers are for fair market value, (ii) the unwinding or termination of commodity Swap Agreements; or (iii) Transfers of all (but not less other than all) of the Equity Interests collectively owned by the Borrower and its Subsidiaries in any E&P Credit Party; provided that in the case of clause (i) or (ii) above, except with respect to any novation sale or replacement, as applicable, contemplated by the final proviso disposition of this Section 9.10(e), at least seventy-five percent Equity Interests due to death or incapacity;
(iii) 75%) (or such greater percentage as may be required to eliminate any resulting Borrowing Base Deficiency) % of the consideration received in respect of such sale or other disposition of any such Oil and Gas Property (or unwinding or terminationsuch Equity Interest), as applicableif any, shall be cash;
(iv) the net cash proceeds from such sale, conveyance, exchange, lease or cash equivalents; provided, further, that to the extent thatother disposition, if during any, shall be sufficient to cover any period commencing with the later of the most recent Scheduled Redetermination Date or the most recent adjustment to the resulting Borrowing Base pursuant to this Section 9.10 through Deficiency;
(v) (other than in respect of Casualty Events) the next Scheduled Redetermination Date, consideration received in respect of a sale or other disposition of such Oil and Gas Properties and commodity Swap Agreements with an aggregate Borrowing Base value in excess of five percent Property or interest therein (5%) of or such Equity Interest), if any, shall be equal to or greater than the Borrowing Base fair market value of all such Oil and Gas Properties included in the Borrowing Base Property or interest therein (or such Equity Interest) subject of the Credit Parties such sale or other disposition (as reasonably determined by a Responsible Officer of the Administrative Agent)Borrowers and, are Transferred or unwound or terminated, as applicable, by any one or more Credit Parties pursuant to this Section 9.10(e), then the Borrowing Base will be reduced, effective immediately, if requested by the Borrowing Base values in excess of such five percent (5%) threshold; providedLender, further, that for purposes of the foregoing proviso, (A) a commodity Swap Agreement Borrowers shall be deemed to have not been unwound or terminated if, (x) such commodity Swap Agreement is novated from the existing counterparty to an Approved Counterparty, with the Borrower or the applicable Credit Party being the “remaining party” for purposes of such novation, or (y) upon its termination or unwinding, it is replaced, in a substantially contemporaneous transaction, with one or more commodity Swap Agreements with the same or longer tenor, covering volumes not less than and for prices not less than those Swap Agreements being replaced and without cash payments to any Credit Party in connection therewith, and (B) an Oil and Gas Property shall be deemed to have not been Transferred if upon its Transfer, it is replaced, in a substantially contemporaneous transaction, with Oil and Gas Properties with approximately the same PV-9 value as reasonably determined by Borrower in good faith and evidenced by delivery to the Administrative Agent of deliver a certificate of a Responsible Officer containing reasonably detailed supporting information for such good faith determination; provided that, this clause (B) shall only apply and may only be relied on of the Borrowers certifying to the extent that the Oil and Gas Properties so Transferred in exchange for other Oil and Gas Properties in any period between two successive Scheduled Redetermination Dates does not exceed seven and one-half percent (7.5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agentforegoing). For the purposes of the preceding sentence, the Transfer of an E&P Credit Party owning such Oil and Gas Properties and/or commodity Swap Agreements pursuant to this Section 9.10(e) shall be deemed the Transfer of the Oil and Gas Properties and the unwinding or termination of the commodity Swap Agreements owned by such E&P Credit Party;
(f) Transfers in connection with Investments permitted by Section 9.05, other than Transfers of (i) any Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base or (ii) any Equity Interests in any E&P Credit Party owning Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base; and
(g) Transfers of Properties among the Credit Parties; provided that (i) with respect to any Transfers of Equity Interests in any E&P Credit Party, the requirements of Section 8.14(b) are satisfied and (ii) with respect to any Transfers of Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, the transferee promptly delivers mortgages or other Security Instruments in favor of the Administrative Agent to the extent necessary to satisfy the requirements of Section 8.14.
Appears in 1 contract
Sale of Properties. The Borrower will not, nor and will it not permit any other Credit Party of the Borrower’s Subsidiaries to, sell, assign, farm-out, convey or otherwise transfer any Property (collectively including, without limitation, any forfeiture of any Property except where such forfeiture is being contested in this sectiongood faith by appropriate proceedings) or sell, “Transfer”) assign, monetize, transfer, cancel, terminate, unwind or otherwise dispose of any Oil and Gas Property or any interest in Hydrocarbons produced or to be produced therefrom or any Equity Interest in any Credit Party that owns any Oil and Gas Property, commodity Swap Agreement or any interest in Hydrocarbons produced or to be produced therefrom (in this section, an “E&P Credit Party”) or unwind or terminate any commodity Swap Agreementsrespect of commodities, except for:
(a) the sale of Hydrocarbons in the ordinary course of business;
(b) farmouts, swaps or trades transfers of interests in undeveloped acreage not included or undrilled depths in the most recently delivered Reserve Report ordinary course of the joint development of Oil and assignments Gas Properties with others including, without limitation, transfers to other parties pursuant to joint development agreements, participation agreements, farm-out agreements, farm-in connection with such farmoutsagreements, swaps or tradesexploration agreements, operating agreements and unit agreements;
(c) the Transfer sale or transfer of equipment that is no longer necessary for its business or the business of the Borrower or such other Credit Party Subsidiary or is replaced by equipment of at least comparable value or and use;
(d) Transfers the sale or other disposition (including Casualty Events) of any Oil and Gas Property or any interest therein or any of its Subsidiaries (other than the Borrower) owning Oil and Gas Properties and the sale, assignment, monetization, transfer, cancellation, termination, unwinding or other disposal of any Swap Agreement in respect of commodities; provided that are not Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base;with respect to this clause (d),
(i) Transfers of Oil and Gas Properties that comprise Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, provided that such Transfers are for fair market value, (ii) the unwinding or termination of commodity Swap Agreements; or (iii) Transfers of all (but not less than all) of the Equity Interests collectively owned by the Borrower and its Subsidiaries in any E&P Credit Party; provided that in the case of clause (i) or (ii) above, except with respect to any novation or replacement, as applicable, contemplated by the final proviso of this Section 9.10(e), at least seventy-five percent (75%) (or such greater percentage as may be required to eliminate any resulting Borrowing Base Deficiency) of the consideration received in respect of such sale or other disposition (including, without limitation, asset exchanges under Section 1031 of the Code) or such sale, assignment, monetization, transfer, cancellation, termination, unwinding or other disposal of any Swap Agreement in respect of commodities shall be equal to or greater than the fair market value of the Oil and Gas Property, interest therein or Subsidiary subject of such sale or other disposition, or Swap Agreement subject of such sale, assignment, monetization, transfer, cancellation, termination, unwinding or other disposal (as applicablereasonably determined by the board of managers (or comparable governing body) of the Borrower, shall be cash or cash equivalents; provided, further, that to the extent thatand, if requested by the Administrative Agent, the Borrower shall deliver a certificate of its Responsible Officer certifying to that effect); and
(ii) if the aggregate fair market value of such sales or other dispositions of Oil and Gas Property (or of a Subsidiary owning Oil and Gas Properties) under this clause (d) and included in the most recently delivered Reserve Report together with the fair market value of such Swap Agreements sold, assigned, monetized, transferred, cancelled, terminated, unwound or otherwise disposed of under this clause (d), in each case during any period commencing with the later of the most recent between two successive Scheduled Redetermination Date or the most recent adjustment to the Borrowing Base pursuant to this Section 9.10 through the next Scheduled Redetermination Date, Oil and Gas Properties and commodity Swap Agreements with an aggregate Borrowing Base value Dates is in excess of five percent (5%) of the Borrowing Base value of all Oil and Gas Properties included as then in effect, individually or in the aggregate, the Borrowing Base shall be reduced, effective immediately upon such sale or disposition by an amount equal to the value, if any, attributed to such Property in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent), are Transferred or unwound or terminated, as applicable, by any one or more Credit Parties pursuant to this Section 9.10(e), then the Borrowing Base will be reduced, effective immediately, Agent and approved by the Borrowing Base values in excess Required Lenders);
(iii) if any such sale or other disposition is of such five percent (5%) threshold; provided, further, that for purposes of the foregoing proviso, (A) a commodity Swap Agreement shall be deemed to have not been unwound or terminated if, (x) such commodity Swap Agreement is novated from the existing counterparty to an Approved Counterparty, with the Borrower or the applicable Credit Party being the “remaining party” for purposes of such novation, or (y) upon its termination or unwinding, it is replaced, in a substantially contemporaneous transaction, with one or more commodity Swap Agreements with the same or longer tenor, covering volumes not less than and for prices not less than those Swap Agreements being replaced and without cash payments to any Credit Party in connection therewith, and (B) an Subsidiary owning Oil and Gas Property Properties, such sale or other disposition shall be deemed to have not been Transferred if upon its Transfer, it is replaced, in a substantially contemporaneous transaction, with Oil and Gas Properties with approximately include all the same PV-9 value as reasonably determined by Borrower in good faith and evidenced by delivery to the Administrative Agent of a certificate of a Responsible Officer containing reasonably detailed supporting information for such good faith determination; provided that, this clause (B) shall only apply and may only be relied on to the extent that the Oil and Gas Properties so Transferred in exchange for other Oil and Gas Properties in any period between two successive Scheduled Redetermination Dates does not exceed seven and one-half percent (7.5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent). For the purposes of the preceding sentence, the Transfer of an E&P Credit Party owning such Oil and Gas Properties and/or commodity Swap Agreements pursuant to this Section 9.10(e) shall be deemed the Transfer of the Oil and Gas Properties and the unwinding or termination of the commodity Swap Agreements owned by such E&P Credit Party;
(f) Transfers in connection with Investments permitted by Section 9.05, other than Transfers of (i) any Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base or (ii) any Equity Interests in any E&P Credit Party owning Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Basesuch Subsidiary; and
(ge) Transfers sales and other dispositions of Properties among the Credit Parties; provided that (inot regulated by Section 9.12(a) with respect through Section 9.12(d) having a fair market value not to exceed $5,000,000 during any Transfers of Equity Interests in any E&P Credit Party, the requirements of Section 8.14(b) are satisfied and (ii) with respect to any Transfers of Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, the transferee promptly delivers mortgages or other Security Instruments in favor of the Administrative Agent to the extent necessary to satisfy the requirements of Section 8.1412-month period.
Appears in 1 contract
Sale of Properties. The Borrower will not, nor and will it not permit any other Credit Loan Party to, sell, assign, farm-out, convey or otherwise transfer Dispose of any Property (collectively in this section, “Transfer”including the Liquidation of any Swap Agreement) any Oil and Gas Property or any interest in Hydrocarbons produced or to be produced therefrom or any Equity Interest in any Credit Party that owns any Oil and Gas Property, commodity Swap Agreement or any interest in Hydrocarbons produced or to be produced therefrom (in this section, an “E&P Credit Party”) or unwind or terminate any commodity Swap Agreements, except for:
(a) the sale of Hydrocarbons and the lease of Oil and Gas Properties, in each case in the ordinary course of business;
(b) farmouts, swaps or trades farmouts in the ordinary course of business of Oil and Gas Properties consisting solely of undeveloped acreage not included or undrilled depths to which no proved reserves are attributed in the most recently delivered Reserve Report and assignments in connection with such farmoutsfarmouts or the abandonment, swaps farmout, trade, exchange, lease, sublease or tradesother Disposition in the ordinary course of business of Oil and Gas Properties not containing proved reserves and which are not included in the most recently delivered Reserve Report;
(c) the Transfer Disposition of equipment that is no longer necessary for the business of the Borrower or any such other Credit Loan Party or is replaced by equipment of at least comparable value or and use;
(d) Transfers the (i) Disposition, other than as provided in clauses (a) through (c), of any Oil and Gas Property or any interest therein or any Restricted Subsidiary owning Oil and Gas Properties that are not Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base;
(i) Transfers of Oil and Gas Properties that comprise Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, provided that such Transfers are for fair market value, or (ii) the unwinding or termination Liquidation of commodity any Swap Agreements; or (iii) Transfers of all (but not less than all) of the Equity Interests collectively owned by the Borrower and its Subsidiaries in any E&P Credit Party; provided that Agreement, in the case of each of the foregoing clause (i) or and clause (ii) above), except with respect to any novation the extent such Disposition or replacementsuch Liquidation, as applicable, contemplated is permitted under the Revolving Credit Agreement;
(e) transfers of Properties from (i) the Borrower and/or its Restricted Subsidiaries to the Borrower and/or any Guarantor and (ii) any Restricted Subsidiary that is not a Guarantor to any other Restricted Subsidiary that is not a Guarantor;
(f) Casualty Events;
(g) Dispositions of the non-cash portion of consideration (other than any Oil and Gas Properties) received for any Disposition permitted by the final proviso of this Section 9.10(e), at least seventy-five percent (75%) (or such greater percentage as may be required to eliminate any resulting Borrowing Base Deficiency) of 9.12; provided that the consideration received in respect of such sale or other disposition or unwinding or termination, as applicable, Disposition shall be cash or cash equivalents; provided, further, that to the extent that, if during any period commencing with the later of the most recent Scheduled Redetermination Date or the most recent adjustment to the Borrowing Base pursuant to this Section 9.10 through the next Scheduled Redetermination Date, Oil and Gas Properties and commodity Swap Agreements with an aggregate Borrowing Base value in excess of five percent (5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent), are Transferred or unwound or terminated, as applicable, by any one or more Credit Parties pursuant to this Section 9.10(e), then the Borrowing Base will be reduced, effective immediately, by the Borrowing Base values in excess of such five percent (5%) threshold; provided, further, that for purposes of the foregoing proviso, (A) a commodity Swap Agreement shall be deemed to have not been unwound or terminated if, (x) such commodity Swap Agreement is novated from the existing counterparty to an Approved Counterparty, with the Borrower or the applicable Credit Party being the “remaining party” for purposes of such novation, or (y) upon its termination or unwinding, it is replaced, in a substantially contemporaneous transaction, with one or more commodity Swap Agreements with the same or longer tenor, covering volumes not less than Cash Equivalents and for prices not less than those Swap Agreements being replaced and without cash payments to any Credit Party in connection therewith, and (B) an Oil and Gas Property shall be deemed to have not been Transferred if upon its Transfer, it is replaced, in a substantially contemporaneous transaction, with Oil and Gas Properties with approximately the same PV-9 value as reasonably determined by Borrower in good faith and evidenced by delivery to the Administrative Agent of a certificate of a Responsible Officer containing reasonably detailed supporting information for such good faith determination; provided that, this clause (B) shall only apply and may only be relied on to the extent that the Oil and Gas Properties so Transferred in exchange for other Oil and Gas Properties in any period between two successive Scheduled Redetermination Dates does not exceed seven and one-half percent (7.5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent). For the purposes of the preceding sentence, the Transfer of an E&P Credit Party owning such Oil and Gas Properties and/or commodity Swap Agreements pursuant to this Section 9.10(e) shall be deemed the Transfer of the Oil and Gas Properties and the unwinding or termination of the commodity Swap Agreements owned by such E&P Credit Partyfair market value;
(fh) Transfers in connection with Restricted Payments permitted by Section 9.04 and Investments permitted by Section 9.05, other than Transfers of ;
(i) [Reserved];
(j) Sales, transfers, leases and Dispositions of Properties (other than (i) Dispositions of any Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base or any interest therein or any Restricted Subsidiary owning Oil and Gas Properties or (ii) any Equity Interests in any E&P Credit Party owning Proved Oil Liquidations of Swap Agreements) having a fair market value not to exceed the greater of (x) $10,000,000 and Gas Properties evaluated in the Reserve Report used in the most recent determination (y) 7.5% of the then-effective Borrowing BaseBase during any 12-month period;
(k) Dispositions of water assets, surface rights and other Property (excluding cash, Cash Equivalents, Hydrocarbon Interests and Borrowing Base Properties) which is primarily related to the water supply business of KMF Water, LLC; and
(gl) Transfers So long as Section 3 of Properties among the Credit Parties; provided that (i) with respect ▇▇▇▇▇▇ Side Letter is in effect pursuant to any Transfers of Equity Interests in any E&P Credit Party, the requirements terms of Section 8.14(b) are satisfied and (ii) with respect to any Transfers of Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination 7 of the Borrowing Base▇▇▇▇▇▇ Side Letter, the transferee promptly delivers mortgages or other Security Instruments in favor Dispositions of the Administrative Agent Specified ORRI pursuant to the terms of the ▇▇▇▇▇▇ Side Letter to the extent necessary to satisfy such Dispositions are permitted under the requirements of Section 8.14Revolving Credit Agreement.
Appears in 1 contract
Sources: 364 Day Bridge Term Loan Agreement (Sitio Royalties Corp.)
Sale of Properties. The Borrower Each Obligor will not, nor and will it not permit any other Credit Party Subsidiary to, sell, assign, farm-out, convey or otherwise transfer (collectively in this section, “Transfer”) any Oil and Gas Property or any interest in Hydrocarbons produced or to be produced therefrom or any Equity Interest in any Credit Party that owns any Oil and Gas Property, commodity Swap Agreement or any interest in Hydrocarbons produced or to be produced therefrom (in this section, an “E&P Credit Party”) or unwind or terminate any commodity Swap Agreements, Property except for:
for (a) the sale of Hydrocarbons in the ordinary course of business;
; (b) farmouts, swaps the sale or trades of undeveloped acreage not included in the most recently delivered Reserve Report and assignments in connection with such farmouts, swaps or trades;
(c) the Transfer transfer of equipment that is no longer necessary for the business of the Borrower such Obligor or such other Credit Party Subsidiary or is replaced by equipment of at least comparable value or and use;
; (c) transactions 69 permitted under Section 9.10 and 9.11; (d) Transfers transactions among Subsidiaries and/or Obligors not prohibited by other sections of this Agreement; (e) the sale of the Indonesian Properties, provided that any such sale is to Persons that are not Affiliates of EEX, is for fair market value and 100% of the net cash proceeds are in immediately available funds and retained overriding royalty or similar interests not intended to be a form of seller financing; (f) transfers of cash and cash equivalents permitted by Section 9.05; (g) ordinary course-of-business farm-outs, joint-ventures and assignments covering off-shore leasehold interests for fair market value and ordinary course-of-business sales or farm-outs of on-shore undeveloped (nonproved) Properties for fair market value; and (h) sales, farm-outs, leases, subleases or other dispositions for fair market value, Casualty Events and dispositions resulting from the exercise of eminent domain, condemnation or nationalization, abandonments or relinquishments of Oil and Gas Properties that or any interest therein or Subsidiaries (which Subsidiaries are not Proved Obligors) owning Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base;
Properties; provided, for this clause (i) Transfers h), that such sales or other dispositions of Oil and Gas Properties that comprise Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, provided that such Transfers are for fair market value, or Subsidiaries (iiother than an Obligor) the unwinding or termination of commodity Swap Agreements; or (iii) Transfers of all (but not less than all) of the Equity Interests collectively owned by the Borrower and its Subsidiaries in any E&P Credit Party; provided that in the case of clause (i) or (ii) above, except with respect to any novation or replacement, as applicable, contemplated by the final proviso of this Section 9.10(e), at least seventy-five percent (75%) (or such greater percentage as may be required to eliminate any resulting Borrowing Base Deficiency) of the consideration received in respect of such sale or other disposition or unwinding or termination, as applicable, shall be cash or cash equivalents; provided, further, that to the extent that, if during any period commencing with the later of the most recent Scheduled Redetermination Date or the most recent adjustment to the Borrowing Base pursuant to this Section 9.10 through the next Scheduled Redetermination Date, Oil and Gas Properties and commodity Swap Agreements with an aggregate Borrowing Base value in excess of five percent (5%) of the Borrowing Base value of all owning Oil and Gas Properties included in the Borrowing Base most recently delivered Reserve Report exceeding $20,000,000.00, individually or in the aggregate, shall require the consent of the Credit Parties (as reasonably determined Required Lenders in their sole discretion, and additionally, any such sales or dispositions by EEX E&P exceeding $10,000,000.00, individually or in the Administrative Agent)aggregate, are Transferred shall also require the consent of the Required Lenders in their sole discretion; provided further that if an Obligor or unwound or terminated, as applicable, by any one or more Credit Parties pursuant to this Section 9.10(e)Subsidiary exchanges Hydrocarbon Interests for Hydrocarbon Interests of a lesser value of another Person, then the Borrowing Base amount counted toward the $20,000,000.00 and $10,000,000.00 caps in permitted sales described in this clause (h) will be reduced, effective immediately, by equal to the Borrowing Base values in excess of such five percent (5%) threshold; provided, further, that for purposes difference between the value of the foregoing proviso, (A) Hydrocarbon Interests transferred less the value of the Hydrocarbon Interests received. If any such sale or other disposition is of a commodity Swap Agreement shall be deemed to have not been unwound or terminated if, (x) such commodity Swap Agreement is novated from the existing counterparty to an Approved Counterparty, with the Borrower or the applicable Credit Party being the “remaining party” for purposes of such novation, or (y) upon its termination or unwinding, it is replaced, in a substantially contemporaneous transaction, with one or more commodity Swap Agreements with the same or longer tenor, covering volumes not less than and for prices not less than those Swap Agreements being replaced and without cash payments to any Credit Party in connection therewith, and (B) an Subsidiary owning Oil and Gas Property Properties, such sale or other disposition shall be deemed to have not been Transferred if upon its Transfer, it is replaced, in a substantially contemporaneous transaction, with Oil include all the capital stock of such Subsidiary. Sales or other dispositions permitted by Section 9.12(g) and Gas Properties with approximately the same PV-9 value as reasonably determined by Borrower in good faith and evidenced by delivery to the Administrative Agent of a certificate of a Responsible Officer containing reasonably detailed supporting information for such good faith determination; provided that, this clause (B) shall only apply and may only be relied on to the extent that the Oil and Gas Properties so Transferred in exchange for other Oil and Gas Properties in any period between two successive Scheduled Redetermination Dates does not exceed seven and one-half percent (7.5%) of the Borrowing Base value of all Oil and Gas Properties included in the Borrowing Base of the Credit Parties (as reasonably determined by the Administrative Agent). For the purposes of the preceding sentence, the Transfer of an E&P Credit Party owning such Oil and Gas Properties and/or commodity Swap Agreements pursuant to this Section 9.10(eh) shall be deemed the Transfer subject to Section 2.03(c). All or part of the Oil and Gas Properties FPS may be sold pursuant to Section 9.04(b) and the unwinding proceeds applied to prepay the Secured Notes or termination of Junior Capital; otherwise, such proceeds shall be used to prepay the commodity Swap Agreements owned by such E&P Credit Party;
(f) Transfers in connection with Investments permitted by Indebtedness pursuant to Section 9.05, other than Transfers of (i) any Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base or (ii) any Equity Interests in any E&P Credit Party owning Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base; and
(g) Transfers of Properties among the Credit Parties; provided that (i) with respect to any Transfers of Equity Interests in any E&P Credit Party, the requirements of Section 8.14(b) are satisfied and (ii) with respect to any Transfers of Proved Oil and Gas Properties evaluated in the Reserve Report used in the most recent determination of the Borrowing Base, the transferee promptly delivers mortgages or other Security Instruments in favor of the Administrative Agent to the extent necessary to satisfy the requirements of Section 8.142.03(c).
Appears in 1 contract
Sources: Credit Agreement (Eex Corp)