Common use of ALLOCATION OF BORROWING BASE Clause in Contracts

ALLOCATION OF BORROWING BASE. (a) The Borrowing Base may be allocated between the Company under this Agreement and Forest under the U.S. Credit Agreement. The Allocated U.S. Borrowing Base in effect from time to time shall represent the maximum amount of credit in the form of Loans and Letters of Credit (subject to the aggregate Commitments and the other provisions of the U.S. Credit Agreement) that the U.S Lenders will extend to Forest at any one time prior to the "Commitment Termination Date" specified in the U.S. Credit Agreement. The Allocated Canadian Borrowing Base in effect from time to time shall represent the maximum amount of credit in the form of Loans, Letters of Credit and Bankers' Acceptances (subject to the aggregate Commitments and the other provisions of this Agreement) that the Lenders will extend to the Company at any one time prior to the Commitment Termination Date. On the date of Amendment No. 1, the Allocated Canadian Borrowing Base shall be $100,000,000, resulting in an initial Allocated U.S. Borrowing Base of $30,000,000. (b) The Company at any time shall have the right to request in writing to the Administrative Agent, U.S. Agent and the Lender Group, in their sole discretion, an increase in the Allocated Canadian Borrowing Base and a corresponding decrease in the Allocated U.S. Borrowing Base; provided that any such increase shall require the approval of all of the Lenders and at no time shall the Allocated Canadian Borrowing Base exceed $100,000,000; and provided further that the Company may not make a request for an increase in the Allocated Canadian Borrowing Base more than four (4) times during any twelve (12) month period. Within ten (10) Business Days of the receipt by the Lenders of such request, the Lenders shall give written notice to the Company, Forest and the U.S. Agent of their approval or disapproval of such increase. If such increase is approved, each such Lender shall have its share of the Allocated Canadian Borrowing Base increased by an amount equal to its proportion of the Commitment Percentage. The revised Allocated U.S. Borrowing Base and Allocated Canadian Borrowing Base shall become effective upon the distribution by the U.S. Agent to the Company, Forest, the Administrative Agent and the Lender Group of written notice thereof which shall occur not later than three (3) Business Days after its receipt of the notice of increase. (c) Forest at any time shall have the right to request in writing to the Administrative Agent, the U.S. Agent and the U.S. Lenders that such U.S. Lenders, in their sole discretion, permit Forest to increase the Allocated U.S. Borrowing Base and decrease the Allocated Canadian Borrowing Base; provided that any such change shall require the approval of all of such U.S. Lenders and at no time shall the Allocated U.S. Borrowing Base exceed $100,000,000; and provided further that Forest may not make a request for an increase in the Allocated U.S. Borrowing Base more than four (4) times during any twelve (12) month period. Within ten (10) Business Days of the receipt by such U.S. Lenders of such request, such U.S. Lenders shall give written notice to the Company, Forest and the U.S. Agent of their approval or disapproval of such change. The revised Allocated U.S. Borrowing Base and Allocated Canadian Borrowing Base shall become effective upon the distribution by the U.S. Agent to the Company, Forest, the Administrative Agent and the Lender Group of written notice thereof which shall occur not later than three (3) Business Days after its receipt of the notice of increase. (d) For purposes of this Agreement, the Allocated Canadian Borrowing Base shall be expressed as the Equivalent Amount in Canadian Dollars. The Equivalent Amount shall be calculated (i) on the date a reallocation pursuant to this Section 2.12 between the Allocated U.S. Borrowing Base and the Allocated Canadian Borrowing Base occurs, (ii) on each Determination Date, or (iii) in any event, at ninety (90) day intervals following the most recent Determination Date." Section 4.01 of the Second Amended and Restated Credit Agreement shall be amended by inserting a new paragraph (g) as follows:

ALLOCATION OF BORROWING BASE. (a) The Borrowing Base may be allocated between the Company Lender under the Funding Credit Agreement (which shall be the Borrowing Base for the purpose of this Agreement Agreement) and Forest under the U.S. Credit Agreement. The Allocated U.S. Borrowing Base in effect from time to time shall represent the maximum amount of credit in the form of Loans and Letters of Credit (subject to the aggregate Commitments and the other provisions of the U.S. Credit Agreement) that the U.S Lenders will extend to Forest at any one time prior to the "Commitment Termination Date" specified in the U.S. Credit Agreement. The Allocated Canadian Borrowing Base in effect from time to time shall represent the maximum amount of credit in the form of Loans, Letters of Credit and Bankers' Acceptances (subject to the aggregate Commitments and the other provisions of this Agreement) that the Canadian Lenders will extend to the Company Lender (and therefor the maximum amount of credit in the form of Loans and Letter of Credit Liabilities that the Lender will extend the Borrowers) at any one time prior to the "Commitment Termination Date" specified in the Funding Credit Agreement. On the date of Amendment No. 1, the Allocated Canadian Borrowing Base shall be $100,000,000, resulting in an initial Allocated U.S. Borrowing Base of $30,000,000. (b) The Company Borrowers at any time shall have the right to request in writing to the Administrative Lender (which shall promptly notify the Agent, U.S. Agent and the Lender Group), in their sole discretion, an increase in the Allocated Canadian Borrowing Base and a corresponding decrease in the Allocated U.S. Borrowing Base; provided that any such increase shall require the approval of all of the Canadian Lenders and at no time shall the Allocated Canadian Borrowing Base exceed $100,000,000; and provided further that the Company Borrowers may not make a request for an increase in the Allocated Canadian Borrowing Base more than four (4) times during any twelve (12) month period. Within ten (10) Business Days of the receipt by the Canadian Lenders of such request, the Canadian Lenders shall give written notice to the CompanyLender, Forest and the U.S. Agent of their approval or disapproval of such increaseincrease and the Lender shall promptly notify the Borrowers. If such increase is approved, each such Lender shall have its share of the Allocated Canadian Borrowing Base increased by an amount equal to its proportion of the Commitment Percentage. The revised Allocated U.S. Borrowing Base and Allocated Canadian Borrowing Base shall become effective upon the distribution by the U.S. Agent to the CompanyLender (who in turn shall notify the Borrowers), Forest, the Administrative Agent and the Lender Group of written notice thereof which shall occur not later than three (3) Business Days after its receipt of the notice of increase.. AMENDMENT NO. 1 (c) Forest at any time shall have the right to request in writing to the Administrative Agent, the U.S. Agent and the U.S. Lenders that such U.S. Lenders, in their sole discretion, permit Forest to increase the Allocated U.S. Borrowing Base and decrease the Allocated Canadian Borrowing Base; provided that any such change shall require the approval of all of such U.S. Lenders and at no time shall the Allocated U.S. Borrowing Base exceed $100,000,000; and provided further that Forest may not make a request for an increase in the Allocated U.S. Borrowing Base more than four (4) times during any twelve (12) month period. Within ten (10) Business Days of the receipt by such U.S. Lenders of such request, such U.S. Lenders shall give written notice to the CompanyLender (who in turn shall notify the Borrowers), Forest and the U.S. Agent of their approval or disapproval of such change. The revised Allocated U.S. Borrowing Base and Allocated Canadian Borrowing Base shall become effective upon the distribution by the U.S. Agent to the CompanyLender (who in turn shall notify the Borrowers), Forest, the Administrative Agent and the Lender Group of written notice thereof which shall occur not later than three (3) Business Days after its receipt of the notice of increase. (d) For purposes of this Agreement, the Allocated Canadian Borrowing Base shall be expressed as the Equivalent Amount in Canadian Dollars. The Equivalent Amount shall be calculated (i) on the date a reallocation pursuant to this Section 2.12 between the Allocated U.S. Borrowing Base and the Allocated Canadian Borrowing Base occurs, (ii) on each Determination Date, or (iii) in any event, at ninety (90) day intervals following the most recent Determination Date." Section 4.01 of the Second Amended and Restated Credit Agreement shall be amended by inserting a new paragraph (ge) as follows:

ALLOCATION OF BORROWING BASE. (a) The Borrowing Base may be allocated between the Company under this Agreement and Funding Co. (or, if the Canadian Lenders are making loans directly to Canadian Forest Oil, Canadian Forest Oil) under the U.S. Funding Credit Agreement. The Allocated U.S. Borrowing Base in effect from time to time shall represent the maximum amount of credit in the form of Loans and Letters of Credit (subject to the aggregate Commitments and the other provisions of the U.S. Credit this Agreement) that the U.S Lenders Banks will extend to Forest the Company at any one time prior to the "Commitment Termination Date" specified in the U.S. Credit Agreement. The Allocated Canadian Borrowing Base in effect from time to time shall represent the maximum amount of credit in the form of Loans, Letters of Credit and Bankers' Acceptances (subject to the aggregate Commitments and the other provisions of this the Funding Credit Agreement) that the Canadian Lenders will extend to Funding Co. (or, if the Company Canadian Lenders are making loans directly to Canadian Forest Oil, Canadian Forest Oil) at any one time prior to the "Commitment Termination Date" specified in the Funding Credit Agreement. On the date of Amendment No. 1hereof, the Allocated Canadian Borrowing Base shall be $100,000,00010,000,000, resulting in an initial Allocated U.S. Borrowing Base of $30,000,000250,000,000. (b) The Company Funding Co. (or, if the Canadian Lenders are making loans directly to Canadian Forest Oil, Canadian Forest Oil) at any time shall have the right to request in writing to the Administrative Agent, U.S. Canadian Agent and the Lender Group, in their sole discretion, an increase in the Allocated Canadian Borrowing Base and a corresponding decrease in the Allocated U.S. Borrowing Base; provided that any such increase shall require the approval of all of the Canadian Lenders and at no time shall the Allocated Canadian Borrowing Base exceed $100,000,00025,000,000; and provided further that Funding Co. (or, if the Company Canadian Lenders are making loans directly to Canadian Forest Oil, Canadian Forest Oil) may not make a request for an increase in the Allocated Canadian Borrowing Base more than four (4) times during any twelve (12) month period. Within ten (10) Business Days of the receipt by the Canadian Lenders of such request, the Canadian Lenders shall give written notice to the Company, Forest Company and the U.S. Agent of their approval or disapproval of such increase. If such increase is approved, each such Lender shall have its share of the Allocated Canadian Borrowing Base increased by an amount equal to its proportion of the Commitment Percentage. The revised Allocated U.S. Borrowing Base and Allocated Canadian Borrowing Base shall become effective upon the distribution by the U.S. Agent to the Company, Forest, the Administrative Canadian Agent and the Lender Group of written notice thereof which shall occur not later than three (3) Business Days after its receipt of the notice of increase. (c) Forest The Company at any time shall have the right to request in writing to the Administrative Agent, the U.S. Canadian Agent and the U.S. Lenders Banks that such U.S. LendersBanks, in their sole discretion, permit Forest the Company to increase the Allocated U.S. Borrowing Base and decrease the Allocated Canadian Borrowing Base; provided that any such change shall require the approval of all of such U.S. Lenders Banks and at no time shall the Allocated U.S. Borrowing Base exceed $100,000,000275,000,000; and provided further that Forest the Company may not make a request for an increase in the Allocated U.S. Borrowing Base more than four (4) times during any twelve (12) month period. Within ten (10) Business Days of the receipt by such U.S. Lenders Banks of such request, such U.S. Lenders Banks shall give written notice to the Company, Forest Company and the U.S. Agent of their approval or disapproval of such change. If such increase is approved, each such Bank shall have its share of the Allocated U.S. Borrowing Base increased by an amount in proportion to its Commitment Percentage. The revised Allocated U.S. Borrowing Base and Allocated Canadian Borrowing Base shall become effective upon the distribution by the U.S. Agent to the Company, Forest, the Administrative Canadian Agent and the Lender Group of written notice thereof which shall occur not later than three (3) Business Days after its receipt of the notice of increase. (d) For purposes of this the Funding Credit Agreement, the Allocated Canadian Borrowing Base shall be expressed as the Equivalent Amount in Canadian DollarsAmount. The Equivalent Amount shall be calculated (i) on the date a reallocation pursuant to this Section 2.12 2.11 between the Allocated U.S. Borrowing Base and the Allocated Canadian Borrowing Base occurs, (ii) on each Determination Date, or (iii) in any event, at ninety (90) day intervals following the most recent Determination Date." Section 4.01 of the Second Amended and Restated Credit Agreement shall be amended by inserting a new paragraph (g) as follows:

ALLOCATION OF BORROWING BASE. (a) The Borrowing Base may be allocated between the Company under this Agreement and Forest under the U.S. Credit AgreementCanadian Borrowers. The Allocated U.S. Borrowing Base in effect from time to time shall represent the maximum amount of credit in the form of U.S. Loans and U.S. Letters of Credit (subject to the aggregate U.S. Commitments and the other provisions of the U.S. Credit this Agreement) that the U.S Lenders U.S. Banks will extend to Forest the Company at any one time prior to the "Commitment Termination Date" specified in the U.S. Credit Agreement. The Allocated Canadian Borrowing Base in effect from time to time shall represent the maximum amount of credit in the form of Canadian Loans, Canadian Letters of Credit and Bankers' Acceptances (subject to the aggregate Canadian Commitments and the other provisions of this Agreement) that the Lenders Canadian Banks will extend to the Company Canadian Borrowers at any one time prior to the Commitment Termination Date. On the date of Amendment No. 1hereof, the Allocated Canadian Borrowing Base shall be $100,000,000U.S.$25,000,000, resulting in an initial Allocated U.S. Borrowing Base of $30,000,000U.S.$225,000,000. (b) The Company at any time shall have the right to request in writing to the Administrative U.S. Agent, the Canadian Agent, the U.S. Agent Banks and the Lender Group, in their sole discretion, an Canadian Banks that such U.S. Banks and Canadian Banks increase in the Allocated U.S. Borrowing Base and decrease the Allocated Canadian Borrowing Base or increase the Allocated Canadian Borrowing Base and a corresponding decrease in the Allocated U.S. Borrowing Base; provided PROVIDED that any such increase change shall require the approval of all of the Lenders U.S. Banks and all of the Canadian Banks and at no time shall the Allocated U.S. Borrowing Base exceed U.S.$225,000,000 or the Allocated Canadian Borrowing Base exceed $100,000,000U.S.$25,000,000; and provided further PROVIDED FURTHER that the Company may not make a request for an increase a change in the Allocated U.S. Borrowing Base and Allocated Canadian Borrowing Base more than four (4) times during any twelve (12) month period. Within ten (10) Business Days of the receipt by the Lenders Banks of such request, the Lenders Banks shall give written notice to the Company, Forest U.S. Agent and the U.S. Canadian Agent of their approval or disapproval of such increasechange. If such increase is approved, each such Lender Bank shall have its share of the Allocated U.S. Borrowing Base or the Canadian Borrowing Base Base, as applicable, increased or decreased, as the case may be, by an amount equal in proportion to its proportion of the Commitment Percentage. The revised Allocated U.S. Borrowing Base and Allocated Canadian Borrowing Base shall become effective upon the distribution by the U.S. Agent to the Company, Forest, the Administrative Canadian Agent and the Lender Group Banks of written notice thereof which shall occur not later than three (3) Business Days after its receipt of the notice of increase. (c) Forest at any time shall have the right to request in writing to the Administrative Agent, the U.S. Agent and the U.S. Lenders that such U.S. Lenders, in their sole discretion, permit Forest to increase the Allocated U.S. Borrowing Base and decrease the Allocated Canadian Borrowing Base; provided that any such change shall require the approval of all of such U.S. Lenders and at no time shall the Allocated U.S. Borrowing Base exceed $100,000,000; and provided further that Forest may not make a request for an increase in the Allocated U.S. Borrowing Base more than four (4) times during any twelve (12) month period. Within ten (10) Business Days of the receipt by such U.S. Lenders of such request, such U.S. Lenders shall give written notice to the Company, Forest and the U.S. Agent of their approval or disapproval of such change. The revised Allocated U.S. Borrowing Base and Allocated Canadian Borrowing Base shall become effective upon the distribution by the U.S. Agent to the Company, Forest, the Administrative Agent and the Lender Group of written notice thereof which shall occur not later than three (3) Business Days after its receipt of the notice of increase. (d) For purposes of this Agreement, the Allocated Canadian Borrowing Base shall be expressed as the Equivalent Amount in Canadian Dollars. The Equivalent Amount shall be calculated (i) on the date a reallocation pursuant to this Section 2.12 between the Allocated U.S. Borrowing Base and the Allocated Canadian Borrowing Base occurs, (ii) on each Determination Date, or (iii) in any event, at ninety (90) day intervals following the most recent Determination Date." Section 4.01 of the Second Amended and Restated Credit Agreement shall be amended by inserting a new paragraph (g) as follows:

ALLOCATION OF BORROWING BASE. (a) The Borrowing Base may be allocated between the Company under this Agreement and Forest Funding Co. under the U.S. Funding Credit Agreement. The Allocated U.S. Borrowing Base in effect from time to time shall represent the maximum amount of credit in the form of Loans and Letters of Credit (subject to the aggregate Commitments and the other provisions of the U.S. Credit this Agreement) that the U.S Lenders Banks will extend to Forest the Company at any one time prior to the "Commitment Termination Date" specified in the U.S. Credit Agreement. The Allocated Canadian Borrowing Base in effect from time to time shall represent the maximum amount of credit in the form of Loans, Letters of Credit and Bankers' Acceptances (subject to the aggregate Commitments and the other provisions of this the Funding Credit Agreement) that the Canadian Lenders will extend to the Company Funding Co. at any one time prior to the "Commitment Termination Date" specified in the Funding Credit Agreement. On the date of Amendment No. 12, the Allocated Canadian Borrowing Base shall be $100,000,000, resulting in an initial Allocated U.S. Borrowing Base of $30,000,000. (b) The Company Funding Co. at any time shall have the right to request in writing to the Administrative Agent, U.S. Canadian Agent and the Lender Group, in their sole discretion, an increase in the Allocated Canadian Borrowing Base and a corresponding decrease in the Allocated U.S. Borrowing Base; provided that any such increase shall require the approval of all of the Canadian Lenders and at no time shall the Allocated Canadian Borrowing Base exceed $100,000,000; and provided further that the Company Funding Co. may not make a request for an increase in the Allocated Canadian Borrowing Base more than four (4) times during any twelve (12) month period. Within ten (10) Business Days of the receipt by the Canadian Lenders of such request, the Canadian Lenders shall give written notice to the Company, Forest Company and the U.S. Agent of their approval or disapproval of such increase. If such increase is approved, each such Lender shall have its share of the Allocated Canadian Borrowing Base increased by an amount equal to its proportion of the Commitment Percentage. The revised Allocated U.S. Borrowing Base and Allocated Canadian Borrowing Base shall become effective upon the distribution by the U.S. Agent to the Company, Forest, the Administrative Canadian Agent and the Lender Group of written notice thereof which shall occur not later than three (3) Business Days after its receipt of the notice of increase. (c) Forest The Company at any time shall have the right to request in writing to the Administrative Agent, the U.S. Canadian Agent and the U.S. Lenders Banks that such U.S. LendersBanks, in their sole discretion, permit Forest the Company to increase the Allocated U.S. Borrowing Base and decrease the Allocated Canadian Borrowing Base; provided that any such change shall require the approval of all of such U.S. Lenders Banks and at no time shall the Allocated U.S. Borrowing Base exceed $100,000,000; and provided further that Forest the Company may not make a request for an increase in the Allocated U.S. Borrowing Base more than four (4) times during any twelve (12) month period. Within ten (10) Business Days of the receipt by such U.S. Lenders Banks of such request, such U.S. Lenders Banks shall give written notice to the Company, Forest Company and the U.S. Agent of their approval or disapproval of such change. If such increase is approved, each such Bank shall have its share of the Allocated U.S. Borrowing Base increased by an amount in proportion to its Commitment Percentage. The revised Allocated U.S. Borrowing Base and Allocated Canadian Borrowing Base shall become effective upon the distribution by the U.S. Agent to the Company, Forest, the Administrative Canadian Agent and the Lender Group of written notice thereof which shall occur not later than three (3) Business Days after its receipt of the notice of increase. (d) For purposes of this the Funding Credit Agreement, the Allocated Canadian Borrowing Base shall be expressed as the Equivalent Amount in Canadian DollarsAmount. The Equivalent Amount shall be calculated (i) on the date a reallocation pursuant to this Section 2.12 2.11 between the Allocated U.S. Borrowing Base and the Allocated Canadian Borrowing Base occurs, (ii) on each Determination Date, or (iii) in any event, at ninety (90) day intervals following the most recent Determination Date." Section 4.01 of the Second Amended and Restated Credit Agreement shall be amended by inserting a new paragraph (g) as follows:" AMENDMENT NO. 2