Common use of Use of Loan Proceeds and Letters of Credit Clause in Contracts

Use of Loan Proceeds and Letters of Credit. (a) Proceeds of all Loans shall be used to refinance the existing debt with Bank of Oklahoma, for general corporate purposes of the Borrower, including, without limitation, costs of acquiring, exploring on and developing Oil and Gas Properties and general working capital needs; and (b) Letters of Credit shall be used solely for general corporate purposes of the Borrower; provided, however, no Letter of Credit may be used in lieu or in support of stay or appeal bonds.