Common use of Use of Proceeds; Margin Stock Clause in Contracts

Use of Proceeds; Margin Stock. The proceeds of the Loans will be used solely as provided in this Agreement, and none of such proceeds will be used (i) for the purpose of purchasing or carrying any “margin stock” as defined in Regulations T, U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224), (ii) for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” or (iii) for any other purpose which might constitute this transaction a “purpose credit” within the meaning of Regulations T, U or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” Neither Borrower nor any Person acting on behalf of Borrower has taken or will take any action which might cause any of the Financing Documents to violate Regulations T, U or X, or any other regulations of the Board of Governors of the Federal Reserve System or to violate the Exchange Act or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans will Commitment may be used solely as provided in this Agreement, and none by the Borrower for the purposes of such proceeds will be used (i) working capital, (ii) Letters of Credit, and (iii) general corporate purposes. Borrower is not engaged principally or as one of its important activities in the business of extending credit for the purpose of purchasing or carrying any “"margin stock” stock " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations Tsaid Regulation U. Neither Borrower, U or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” Neither Borrower any Subsidiary nor any other Person or entity acting on behalf of Borrower or any Subsidiary has taken or will take any action which might cause the loans hereunder or any of the Financing Documents Loan Documents, including this Agreement, to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans loans hereunder will be used solely as provided by Borrower for working capital, acquisition, letters of credit and general corporate purposes. Borrower is not engaged in this Agreement, and none the business of such proceeds will be used (i) extending credit for the purpose of purchasing or carrying any “"margin stock” " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations T, U or X. said Regulation U. Borrower is not engaged principally, or as one of its important activities, in the business of extending credit for the purpose, whether immediate, incidental or ultimate, purpose of buying purchasing or carrying “margin stock.” . Neither Borrower nor any Person person or entity acting on behalf of Borrower has taken or will take any action which might cause the loans hereunder or any of the Financing Documents Security Instruments, including this Agreement, to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans Note will be used by the Borrower solely as provided in this Agreement, and none for the purposes described herein. None of such proceeds will be used (i) for the purpose of purchasing or carrying any “margin stock” as defined in Regulations T, Regulation U or Regulation X of the Board board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintainingreducing or retiring any debt which was originally incurred to purchase or carry a margin stock or for any other purpose which might constitute this transaction a “purpose credit’ within the meaning of such Regulations. The Borrower is not engaged principally or as one of its important activities in the business of extending credit for the purpose of purchasing or carrying any “margin stock” as defined in such Regulations, or for the purpose of reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “purpose credit” within with in the meaning of Regulations T, U or X. Borrower is not engaged in said Regulations. Neither the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” Neither Borrower nor any Person acting on behalf of Borrower the Borrower, has taken or will take any action which might cause the Note hereunder or under any of the Financing Documents Security Instruments, including this Agreement, to violate said Regulations T, U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of availability under the Loans Revolving Commitment will be used solely by Borrower for general corporate purposes other than hostile acquisitions. Borrower is not engaged principally or as provided one of its important activities in this Agreement, and none the business of such proceeds will be used (i) extending credit for the purpose of purchasing or carrying any “"margin stock” " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations T, U or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” said Regulation U. Neither Borrower nor any Person person or entity acting on behalf of Borrower has taken or will take any action which might cause the loans hereunder or any of the Financing Documents Loan Documents, including this Agreement, to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans each Advance will be used solely as provided to pay for the cost of the acquisition of Lots (or to refund the cost of Lots which were previously acquired) located in this Agreement, an Approved Subdivision and the cost of new construction of Homes on each such Lot; none of such proceeds will be used (i) for the purpose of purchasing or carrying any “"margin stock” " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations Tsuch Regulation U. Neither the Borrower nor any Subsidiary is engaged principally, U or X. Borrower is not engaged as one of its important activities, in the business of extending credit for the purpose, whether immediate, incidental or ultimate, purpose of buying purchasing or carrying “margin stock.” Neither stocks and neither the Borrower nor any Subsidiary, nor any Person acting on behalf of the Borrower or any Subsidiary, has taken or will take any action which might cause the Note or any of the Financing Documents Security Instruments, including this Agreement, to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate Section 7 of the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans will Commitment may be used by Borrower solely as provided in this Agreement, and none for the purposes of such proceeds will be used (i) refinancing existing indebtedness under the Approach Resources I Credit Agreement (as defined in Section 36 hereof), (ii) acquisition, exploration and development of Oil and Gas Properties, including capital expenditures to fund drilling activities on the Oil and Gas Properties, (iii) working capital; and (iv) other general corporate purposes in the ordinary course of Borrower’s and each Guarantor’s business. Borrower is not engaged principally or as one of its important activities in the business of extending credit for the purpose of purchasing or carrying any “margin stock” as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “purpose credit” within the meaning of Regulations T, U or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” said Regulation U. Neither Borrower nor any Person person or entity acting on behalf of Borrower has taken or will take any action which might cause the loans hereunder or any of the Financing Documents Loan Documents, including this Agreement, to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans Loan hereunder will be used solely as provided by the Borrower for the purposes listed in this Agreement, and none Article 2 hereof. None of such proceeds will be used (i) for the purpose of, and the Borrower is not engaged in the business of extending credit for the purpose of, purchasing or carrying any “"margin stock” " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations T, U or X. said Regulation U. The Borrower is not engaged principally, or as one of the Borrower's important activities, in the business of extending credit for the purpose, whether immediate, incidental or ultimate, purpose of buying purchasing or carrying “margin stock.” stocks. Neither the Borrower nor any Person acting on behalf of the Borrower has taken or will take any action which might cause any of the Financing Documents this Agreement to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter hereinafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans extensions of credit hereunder will be used solely as provided by Borrowers for the purposes listed in this Agreement, and none Section 2.10. None of such proceeds will be used (i) for the purpose of, and neither Borrower is engaged in the business of extending credit for the purpose of, purchasing or carrying any “"margin stock” " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations T, U or X. said Regulation U. Neither Borrower is not engaged principally, or as one of such Borrower's important activities, in the business of extending credit for the purpose, whether immediate, incidental or ultimate, purpose of buying purchasing or carrying “margin stock.” stocks. Neither either Borrower nor any other Person acting on behalf of either Borrower has taken or will take any action which might cause any of the Financing Documents this Agreement to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter hereinafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans will Commitment may be used solely as provided in this Agreement, and none by Borrowers for the purposes of such proceeds will be used (i) refinance existing indebtedness, (ii) acquisition, exploration and development of oil and gas properties, (iii) Letters of Credit, and (iv-) working capital and other general corporate purposes. Neither Borrower is engaged principally or as one of their important activities in the business of extending credit for the purpose of purchasing or carrying any “"margin stock” stock " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations T, U or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” said Regulation U. Neither Borrower nor any Person person or entity acting on behalf of either Borrower has taken or will take any action which might cause the loans hereunder or any of the Financing Documents Loan Documents, including this Agreement, to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans will Commitment may be used solely as provided in this Agreement, and none by the Borrowers for the purposes of such proceeds will be used (i) refinancing existing debt, (ii) acquisition, exploration and development of oil and gas properties or entities owning oil and gas properties, (iii) Letters of Credit, and (iv) general corporate purposes. Neither Borrower is engaged principally or as one of its important activities in the business of extending credit for the purpose of purchasing or carrying any “"margin stock” stock " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations T, U said Regulation G or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” U. Neither Borrower nor any Person person or entity acting on behalf of Borrower Borrowers has taken or will take any action which might cause the loans hereunder or any of the Financing Documents Loan Documents, including this Agreement, to violate Regulations T, Regulation G or U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans will Commitment may be used by the Borrower solely as provided in this Agreement, and none for the purposes of such proceeds will be used (i) acquisition, exploration and development of oil and gas properties, and (ii) working capital and letters of credit, and (iii) other general corporate purposes including the purchase of Junior Securities. Borrower is not engaged principally or as one of its important activities in the business of extending credit for the purpose of purchasing or carrying any “"margin stock” stock " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations T, U or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” said Regulation U. Neither Borrower nor any Person person or entity acting on behalf of Borrower has taken or will take any action which might cause the loans hereunder or any of the Financing Documents Loan Documents, including this Agreement, to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans will Revolving ----------------------------- Commitment may be used solely as provided in this Agreement, and none of such proceeds will be used to (i) refinance existing bank debt, (ii) for the acquisition and development of oil and gas properties, (iii) Letters of Credit, and (iv) general corporate purposes. Neither Borrower nor any Subsidiary is engaged principally or as one of its important activities in the business of extending credit for the purpose of purchasing or carrying any “"margin stock” stock " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations Tsaid Regulation U. Neither Borrower, U or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” Neither Borrower any Subsidiary nor any Person person or entity acting on behalf of Borrower or any Subsidiary has taken or will take any action which might cause the loans hereunder or any of the Financing Documents Loan Documents, including this Agreement, to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans will ----------------------------- Advances shall be used by the Borrower solely as provided in this Agreement, for the purpose of paying Indebtedness outstanding under the Loan Agreement and none for general corporate purposes of the Borrower. None of such proceeds will shall be used (i) for the purpose of purchasing or carrying any “"margin stock” " as defined in Regulations TRegulation U of the Board of Governors of the Federal Reserve System, or for the purpose of reducing or retiring any Indebtedness which was originally incurred to purchase or carry margin stock or for any other purpose which might constitute this transaction a "purpose credit" within the meaning of such Regulation U. Neither the Borrower nor any Person acting on behalf of the Borrower shall (i) take any action in violation of Regulation U or Regulation X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224)System, (ii) for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” or (iii) for any other purpose which might constitute this transaction a “purpose credit” within the meaning of Regulations T, U or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” Neither Borrower nor any Person acting on behalf of Borrower has taken or will take any action which might cause any violate Section 7 of the Financing Documents to violate Regulations T, U or X, or any other regulations of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934, as amended, or any rule or regulation thereunder, or (iii) engage in each case as now in effect or as any transaction which is subject to the same may hereafter be in effectSecurities Credit Transaction Regulations.

Use of Proceeds; Margin Stock. The proceeds of the Revolving Credit Loans will be used by Borrower solely as provided for the purposes specified in this Agreement, and none . None of such proceeds will be used (i) for the purpose of purchasing or carrying any “"margin stock” " as defined in Regulations TRegulation U, U Regulation X, or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220Regulation G, 221 and 224), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness Indebtedness which was originally incurred to purchase or carry a “"margin stock,” " or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations Tsuch Regulation U, U Regulation X, or X. Regulation G. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, purpose of buying purchasing or carrying “margin stock.” Neither stocks. Borrower has neither taken nor any will take, and no Person acting on behalf of Borrower has taken or will take take, any action which might cause the Notes or any of the Financing Documents other Loan Documents, including this Agreement, to violate Regulations TRegulation U, U or Regulation X, or Regulation G or any other regulations of the Board of Governors of the Federal Reserve System or to violate Section 8 of the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter hereinafter be in effect. Borrower neither owns, nor does any subsidiary of Borrower own, "margin stock".

Use of Proceeds; Margin Stock. The proceeds of the Loans will Commitment may be used by Borrower solely as provided in this Agreement, and none for the purposes of such proceeds will be used (i) refinance existing indebtedness, (ii) acquisition, exploration and development of oil and gas properties, (iii) Letters of Credit, and (iv) working capital. Borrower is not engaged principally or as one of its important activities in the business of extending credit for the purpose of purchasing or carrying any “margin stock” as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “purpose credit” within the meaning of Regulations T, U or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” said Regulation U. Neither Borrower nor any Person person or entity acting on behalf of Borrower has taken or will take any action which might cause the loans hereunder or any of the Financing Documents Loan Documents, including this Agreement, to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans Loan will be used solely as provided in this Agreement, and none of such proceeds will be used (i) for the purpose of purchasing or carrying any “margin stock” as defined in Regulations T, U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224), (ii) for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” or (iii) for any other purpose which might constitute this transaction a “purpose credit” within the meaning of Regulations T, U or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” Neither Borrower nor any Person acting on behalf of Borrower has taken or will take any action which might cause any of the Financing Documents to violate Regulations T, U or X, or any other regulations of the Board of Governors of the Federal Reserve System or to violate the Exchange Act or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans loans hereunder will be used solely as provided by Borrower for working capital, acquisition, letters of credit and general corporate purposes. Borrower is not engaged in this Agreement, and none the business of such proceeds will be used (i) extending credit for the purpose of purchasing or carrying any “margin stock” as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “purpose credit” within the meaning of Regulations T, U or X. said Regulation U. Borrower is not engaged principally, or as one of its important activities, in the business of extending credit for the purpose, whether immediate, incidental or ultimate, purpose of buying purchasing or carrying “margin stock.” . Neither Borrower nor any Person person or entity acting on behalf of Borrower has taken or will take any action which might cause the loans hereunder or any of the Financing Documents Security Instruments, including this Agreement, to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of availability under the Loans Revolving Commitment will be used solely as provided in this Agreement, and none by Borrowers for the purposes of such proceeds will be used (i) refinancing existing debt, (ii) for letters of credit, and (iii) general corporate purposes other than hostile acquisitions. Neither Borrower is engaged principally or as one of its important activities in the business of extending credit for the purpose of purchasing or carrying any “"margin stock” " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations T, U or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” said Regulation U. Neither Borrower Borrowers nor any Person person or entity acting on behalf of Borrower has Borrowers have taken or will take any action which might cause the loans hereunder or any of the Financing Documents Loan Documents, including this Agreement, to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans will Commitment may be used solely as provided in this Agreement, and none by the Borrowers for the purposes of such proceeds will be used (i) refinance existing indebtedness, (ii) acquisition and development of oil and gas properties, (iii) Letters of Credit, (iv) working capital and (v) general corporate purposes. None of the Borrowers are engaged principally or as one of their important activities in the business of extending credit for the purpose of purchasing or carrying any “"margin stock” stock " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations T, U or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” Neither said Regulation U. No Borrower nor any Person person or entity acting on behalf of Borrower the Borrowers has taken or will take any action which might cause the loans hereunder or any of the Financing Documents Loan Documents, including this Agreement, to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans will Revolving Commitment may be used solely as provided in this Agreement, and none by the Borrowers for the purposes of such proceeds will be used (i) financing the Plan of Combination, (ii) refinancing existing Debt, and (iii) general corporate purposes. Neither Borrower is engaged principally or as one of its important activities in the business of extending credit for the purpose of purchasing or carrying any “"margin stock” stock " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations T, U said Regulation G or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” Neither U. No Borrower nor any Person person or entity acting on behalf of any Borrower has taken or will take any action which might cause the loans hereunder or any of the Financing Documents Loan Documents, including this Agreement, to violate Regulations T, Regulation G or U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans will Revolving Commitment may be used solely as provided in this Agreement, and none by the Borrower for the purposes of such proceeds will be used (i) acquisition and development of oil and gas properties, (ii) Letters of Credit, and (iii) general corporate purposes. Borrower is not engaged principally or as one of their important activities in the business of extending credit for the purpose of purchasing or carrying any “"margin stock” stock " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations T, U said Regulation G or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” U. Neither Borrower nor any Person person or entity acting on behalf of Borrower has taken or will take any action which might cause the loans hereunder or any of the Financing Documents Loan Documents, including this Agreement, to violate Regulations T, Regulation G or U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans Note will be used by Borrower solely as provided in this Agreement, and none of such proceeds will be used (i) to provide funds for working capital, (ii) to provide funds for repayment of existing loans, or (iii) other general corporate purposes. Borrower will not use any part of the proceeds of the Note for the purpose of purchasing "purchasing" or carrying "carrying" any “"margin stock” " as such terms are defined in Regulations TU, U G, T or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220System, 221 and 224), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the the, meaning of Regulations T, U or X. said Regulation U. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, purpose of buying purchasing or carrying “margin stock.” . Neither Borrower nor any Person person or entity acting on behalf of Borrower has taken or will take any action which might cause any of the Financing Documents loans hereunder to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.;

Use of Proceeds; Margin Stock. The proceeds of availability under the Loans will Revolving Commitment shall be used solely as provided in this Agreement, and none of such proceeds will be used by Borrower for (i) the issuance of Letters of Credit, (ii) working capital and (iii) general business purposes. Borrower is not engaged principally or as one of its important activities in the business of extending credit for the purpose of purchasing or carrying any “"margin stock” " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations T, U or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” said Regulation U. Neither Borrower nor any Person person or entity acting on behalf of Borrower has taken or will take any action which might cause the loans hereunder or any of the Financing Documents Security Instruments, including this Agreement, to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans extensions of credit hereunder will be used solely as provided by Borrowers for the purposes listed in this Agreement, and none Section 2.10. None of such proceeds will be used (i) for the purpose of, and neither Borrower is engaged in the business of extending credit for the purpose of, purchasing or carrying any “margin stock” as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “purpose credit” within the meaning of Regulations T, U or X. said Regulation U. Neither Borrower is not engaged principally, or as one of such Borrower’s important activities, in the business of extending credit for the purpose, whether immediate, incidental or ultimate, purpose of buying purchasing or carrying “margin stock.” stocks. Neither either Borrower nor any other Person acting on behalf of either Borrower has taken or will take any action which might cause any of the Financing Documents this Agreement to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter hereinafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans Loan hereunder will be used solely as provided by Borrower for the purposes listed in this Agreement, and none Article 2 hereof. None of such proceeds will be used (i) for the purpose of, and ▇▇▇▇▇▇▇▇ is not engaged in the business of extending credit for the purpose of, purchasing or carrying any “margin stock” as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “purpose credit” within the meaning of Regulations T, U or X. said Regulation U. Borrower is not engaged principally, or as one of Borrower’s important activities, in the business of extending credit for the purpose, whether immediate, incidental or ultimate, purpose of buying purchasing or carrying “margin stock.” stocks. Neither Borrower nor any Person acting on behalf of Borrower ▇▇▇▇▇▇▇▇ who is authorized to do so has taken or will take any action which might cause any of the Financing Documents this Agreement to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter hereinafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans Note will be used solely as provided by the Borrower for the following purposes: Construction of Residences in this Agreement, accordance with the terms and none provisions hereof. None of such proceeds will be used (i) for the purpose of purchasing or carrying any “"margin stock” " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations T, U or X. such Regulation U. The Borrower is not engaged principally, or as one of the Borrower's important activities, in the business of extending credit for the purpose, whether immediate, incidental or ultimate, purpose of buying purchasing or carrying “margin stock.” stocks. Neither the Borrower nor any Person acting on behalf of the Borrower has taken or will take any action which might cause the Note or any of the Financing Documents Security Instruments, including this Agreement, to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate Section 7 of the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter hereinafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of availability under the Loans Revolving Commitment will be used solely as provided in this Agreement, and none by Borrower for the purposes of such proceeds will be used (i) refinancing existing debt, (ii) letters of credit, (iii) working capital and (iv) general corporate purposes. Borrower is not engaged principally or as one of its important activities in the business of extending credit for the purpose of purchasing or carrying any “"margin stock” " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations T, U or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” said Regulation U. Neither Borrower nor any Person person or entity acting on behalf of Borrower has taken or will take any action which might cause the loans hereunder or any of the Financing Documents Loan Documents, including this Agreement, to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of availability under the Loans Revolving Commitment will be used solely by Borrower for general corporate purposes other than hostile acquisitions including, but not limited to, the purchase of offshore drilling rigs and the stock and/or assets of companies which own or operate offshore rigs. Borrower is not engaged principally or as provided one of its important activities in this Agreement, and none the business of such proceeds will be used (i) extending credit for the purpose of purchasing or carrying any “"margin stock” " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations T, U or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” said Regulation U. Neither Borrower nor any Person person or entity acting on behalf of Borrower has taken or will take any action which might cause the loans hereunder or any of the Financing Documents Loan Documents, including this Agreement, to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans will Revolving Commitment may be used solely by the Borrower for the purposes of general corporate purposes. Borrower is not engaged principally or as provided one of its important activities in this Agreement, and none the business of such proceeds will be used (i) extending credit for the purpose of purchasing or carrying any “margin stock” as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “purpose credit” within the meaning of Regulations Tsaid Regulation G or U. Specifically, U Borrower will not and shall not use the proceeds of the Loan to purchase or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” Neither ”. Borrower nor any Person person or entity acting on behalf of Borrower has taken or will take any action which might cause the loans hereunder or any of the Financing Documents Loan Documents, including this Agreement, to violate Regulations T, Regulation G or U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of availability under the Loans Revolving Commitment will be used solely as provided in this Agreement, and none by Borrower for the purposes of such proceeds will be used (i) funding of capital expenditures to upgrade and modernize existing fleet of offshore drilling rigs, (ii) working capital and (iii) general corporate purposes. Borrower is not engaged principally or as one of its important activities in the business of extending credit for the purpose of purchasing or carrying any “"margin stock” " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations T, U or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” said Regulation U. Neither Borrower nor any Person person or entity acting on behalf of Borrower has taken or will take any action which might cause the loans hereunder or any of the Financing Documents Loan Documents, including this Agreement, to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans will Advances ----------------------------- shall be used by the Borrower solely as provided in for the purpose of paying indebtedness outstanding under this Agreement, Agreement and none for general corporate purposes of the Borrower. None of such proceeds will shall be used (i) for the purpose of purchasing or carrying any “"margin stock” " as defined in Regulations TRegulation U of the Board of Governors of the Federal Reserve System, or for the purpose of reducing or retiring any Indebtedness which was originally incurred to purchase or carry margin stock or for any other purpose which might constitute this transaction a "purpose credit" within the meaning of such Regulation U. Neither the Borrower nor any Person acting on behalf of the Borrower shall (i) take any action in violation of Regulation U or Regulation X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224)System, (ii) for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” or (iii) for any other purpose which might constitute this transaction a “purpose credit” within the meaning of Regulations T, U or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” Neither Borrower nor any Person acting on behalf of Borrower has taken or will take any action which might cause any violate Section 7 of the Financing Documents to violate Regulations T, U or X, or any other regulations of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934, as amended, or any rule or regulation thereunder, or (iii) engage in each case as now in effect or as any transaction which is subject to the same may hereafter be in effectSecurities Credit Transaction Regulations.

Use of Proceeds; Margin Stock. The proceeds of the Loans Revolving Loan will be used solely as provided in this Agreementby Borrower for the purposes of refinancing of existing debt, for development drilling, for acquisitions of oil and none gas properties and payment of such approved payables. The proceeds of the Advance Loan will only be used (i) by Borrower for the Drilling Program. Borrower is not engaged principally or as one of its important activities in the business of extending credit for the purpose of purchasing or carrying any “"margin stock” " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations Tsaid Regulation U. Neither Borrower, U or X. Borrower is not engaged in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” Neither Borrower Guarantor nor any Person person or entity acting on behalf of Borrower has or Guarantor have taken or will take any action which might cause the loans hereunder or any of the Financing Documents Security Instruments, including this Agreement, to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans Note will be used solely as provided in this Agreementby Borrower for the purpose of providing financing for purchasing treasury stock of Borrower, for Borrower's working capital, and none for other general corporate purposes. None of such proceeds will be used (i) for the purpose of purchasing or carrying any “"margin stock” " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220C.F.R., 221 and 224), (iiPart 221) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations T, U or X. such Regulation U. Borrower is not engaged (principally or as one of Borrower's important activities) in the business of extending credit for the purpose, whether immediate, incidental or ultimate, purpose of buying purchasing or carrying “margin stock.” stocks. Neither Borrower nor any Person acting on behalf of Borrower has taken or will take any action which might cause the Note, this Agreement, or any of the Financing Documents Security Instruments to violate Regulations T, Regulation U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate Section 7 of the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter hereinafter be in effect.

Use of Proceeds; Margin Stock. The proceeds of the Loans will Revolving Commitment may be used solely as provided in this Agreement, and none of such proceeds will be used by the Borrowers only for the following purposes: (i) as to the initial Advance hereunder, for the purchase by the Banks from the lenders under the Prior Credit Agreement of the loan made pursuant to the Prior Credit Agreement and related documents, and (ii) as to any and all subsequent Advances, for exploration, development or acquisition of oil and/or gas properties, working capital. and general corporate purposes. No Borrower is engaged principally or as one of its important activities in the business of extending credit for the purpose of purchasing or carrying any “"margin stock” stock " as defined in Regulations T, Regulation U or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221 and 224Part 221), (ii) or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry a “margin stock,” stock or (iii) for any other purpose which might constitute this transaction a “"purpose credit” " within the meaning of Regulations T, Regulation G or Regulation U or X. Borrower is not engaged in of the business Board of extending credit for Governors of the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock.” Neither Federal Reserve System. No Borrower nor any Person acting on behalf of any Borrower has taken or will take any action which might cause the loans hereunder or any of the Financing Documents Loan Documents, including this Agreement, to violate Regulations T, Regulation G or U or X, or any other regulations regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Exchange Act of 1934 or any rule or regulation thereunder, in each case as now in effect or as the same may hereafter be in effect.