Borrowing Base Determination. The Borrowing Base in effect as of the Closing is One Hundred Million Dollars ($100,000,000.00). The Borrowing Base shall be re-determined from time to time pursuant to the following provisions of this Section. On or before April 1, 2003, the Borrower shall furnish to the Administrative Agent information sufficient to update to an effective date of January 1, 2003, the most recent petroleum engineering reports provided to the Administrative Agent prior to Closing relative to the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties. Upon receipt of such information, the Administrative Agent shall, in the normal course of business make a determination of the Borrowing Base, which shall become effective upon approval by the Required Banks and subsequent written notification from the Administrative Agent to the Borrower, and which, subject to the other provisions of this Agreement, shall be the basis on which the Borrowing Base shall thereafter be calculated until the effective date of the next redetermination of the Borrowing Base as set forth in this Section. Thereafter, on or before each April 1 and October 1 until the Facility Termination Date, beginning October 1, 2003, the Borrower shall furnish to the Administrative Agent a report, in form and substance satisfactory to the Administrative Agent, which report shall set forth, as of each preceding January 1 or July 1, as applicable, the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties. Each report to be provided on or before each April 1 shall be a complete report relating to the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties prepared by an independent petroleum engineer or firm of engineers reasonably satisfactory to the Administrative Agent. Each report to be provided on or before each October 1 shall simply update the previous complete report, and may be prepared by the Borrower's own engineers and shall be certified by the President or Chief Financial Officer of the Borrower. Upon receipt of each such report, the Administrative Agent shall, in the normal course of business, make a determination of the Borrowing Base which shall become effective upon approval by the Required Banks and subsequent written notification from the Administrative Agent to the Borrower, and which, subject to the other provisions of this Agreement, shall be the basis on which the Borrowing Base shall thereafter be calculated until the effective date of the next redetermination of the Borrowing Base as set forth in this Section 2.06. The Administrative Agent may, subject to approval of the Required Banks, and must, upon the request of the Required Banks, redetermine the Borrowing Base at any time, and from time to time, which redetermination shall become effective upon approval by the Required Banks and subsequent written notification from the Administrative Agent to the Borrower and which, subject to the other provisions of this Agreement, shall be the basis on which the Borrowing Base shall thereafter be calculated until the effective date of the next redetermination of the Borrowing Base, as set forth in this Section. The Administrative Agent may request in writing that the Borrower provide a Reserve Report regarding the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties with an effective date not more than ninety (90) days prior to Borrower's delivery of such Reserve Report to Administrative Agent, and such Reserve Report shall be delivered to Administrative Agent within ninety (90) days after Borrower's receipt of such written request. The Borrower shall have the right to request, by written notice to Administrative Agent, one unscheduled redetermination of the Borrowing Base between any two scheduled redeterminations thereof, subject to contemporaneously providing to Administrative Agent a Reserve Report with an effective date not more than ninety (90) days prior to the date of such notice. If at any time the Required Banks cannot otherwise agree on a redetermination of the Borrowing Base, then the Borrowing Base, shall be set on the basis of the Administrative Agent's calculation of the "weighted arithmetic average" (as hereinafter calculated) of the Borrowing Base, as determined by each individual Bank and communicated to Administrative Agent in writing. However, the amount of the Borrowing Base shall never be increased at any time without the unanimous consent of the Banks, notwithstanding anything else herein to the contrary. For purposes of this paragraph, the "weighted arithmetic average" of the Borrowing Base shall be determined by first multiplying the Borrowing Base proposed in writing to Administrative Agent by each Bank by such Bank's Percentage Share, and then adding the results of each such calculation, with the resultant sum being the Borrowing Base. The Borrowing Base shall represent the Required Banks' approval of the Administrative Agent's determination, in accordance with its customary lending practices, of the maximum loan amount with respect to the Borrowing Base Oil and Gas Properties and the Borrower acknowledges, for purposes of this Agreement, such determination by the Administrative Agent as being the maximum loan amount with respect to the Borrowing Base Oil and Gas Properties. In making any redetermination of the Borrowing Base, the Administrative Agent and the Banks shall apply the parameters and other credit factors consistently applied then generally being utilized by the Administrative Agent and each such Bank, respectively, for Borrowing Base redeterminations for other similarly situated borrowers. The Borrower, Required Banks and the Administrative Agent acknowledge that (a) due to the uncertainties of the oil and gas extraction process, the Borrowing Base Oil and Gas Properties are not subject to evaluation with a high degree of accuracy and are subject to potential rapid deterioration in value, and (b) for this reason and the difficulties and expenses involved in liquidating and collecting against the Borrowing Base Oil and Gas Properties, the Administrative Agent's determination of the maximum loan amount with respect to the Borrowing Base Oil and Gas Properties contains an equity cushion, which equity cushion is acknowledged by the Borrower as essential for the adequate protection of the Banks.
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Borrowing Base Determination. The initial Borrowing Base in effect as is hereby established at $2,450,000.00. Subject to the other provisions of this Agreement, the Closing is One Hundred Million Dollars ($100,000,000.00). The Borrowing Base shall be re-determined from time to time pursuant to automatically reduced commencing on June 1, 2000, by the following provisions Monthly Borrowing Base Reduction, which is initially established at $50,000.00, and continuing on the first day of each successive month through the next Borrowing Base determination as set forth in this SectionSection 2.05. On or before April September 1, 20032000, the Borrower shall furnish to the Administrative Agent Bank information sufficient to update to an effective date of January July 1, 20032000, the most recent petroleum engineering reports provided to the Administrative Agent Bank prior to Closing relative to the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties. Upon receipt of such informationreport, the Administrative Agent Bank shall, in the normal course of business make a determination of the Borrowing Base, Base and the Monthly Borrowing Base Reduction which shall become effective upon approval by the Required Banks and subsequent written notification from the Administrative Agent Bank to the Borrower, and which, subject to the other provisions of this Agreement, shall be the basis on which the Borrowing Base shall thereafter be calculated until the effective date of the next redetermination of the Borrowing Base and the Monthly Borrowing Base Reduction as set forth in this Section. Thereafter, on or before each April March 1 and October September 1 until the Facility Revolving Loan Termination Date, beginning October 1, 2003, the Borrower shall furnish to the Administrative Agent Bank a report, in form and substance satisfactory to the Administrative AgentBank, which report shall set forth, as of each preceding January 1 or July 1, as applicable, the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties. Each report to be provided on or before each April March 1 shall be a complete report relating to the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties prepared by an independent petroleum engineer or firm of engineers reasonably satisfactory to the Administrative AgentBank. Each report to be provided on or before each October September 1 shall simply update the previous complete report, and may be prepared by the Borrower's own engineers and shall be certified by the President or Chief Financial Executive Officer of the Borrower. Upon receipt of each such report, the Administrative Agent Bank shall, in the normal course of business, make a determination of the Borrowing Base and the Monthly Borrowing Base Reduction which shall become effective upon approval by the Required Banks and subsequent written notification from the Administrative Agent Bank to the Borrower, and which, subject to the other provisions of this Agreement, shall be the basis on which the Borrowing Base shall thereafter be calculated until the effective date of the next redetermination of the Borrowing Base and the Monthly Borrowing Base Reduction as set forth in this Section 2.062.05. The Administrative Agent may, subject to approval of the Required Banks, and must, upon the request of the Required Banks, Bank may redetermine the Borrowing Base and the Monthly Borrowing Base Reduction, at any time, and from time to time, which redetermination shall become effective upon approval by the Required Banks and subsequent written notification from the Administrative Agent Bank to the Borrower and which, subject to the other provisions of this Agreement, shall be the basis on which the Borrowing Base shall thereafter be calculated until the effective date of the next redetermination of the Borrowing Base, as set forth in this Section. The Administrative Agent may request in writing that the Borrower provide a Reserve Report regarding the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties with an effective date not more than ninety (90) days prior to Borrower's delivery of such Reserve Report to Administrative Agent, and such Reserve Report shall be delivered to Administrative Agent within ninety (90) days after Borrower's receipt of such written request. The Borrower shall have the right to request, by written notice to Administrative Agent, one unscheduled redetermination of the Borrowing Base between any two scheduled redeterminations thereof, subject to contemporaneously providing to Administrative Agent a Reserve Report with an effective date not more than ninety (90) days prior to the date of such notice. If at any time the Required Banks cannot otherwise agree on a redetermination of the Borrowing Base, then the Borrowing Base, shall be set on the basis of the Administrative Agent's calculation of the "weighted arithmetic average" (as hereinafter calculated) of the Borrowing Base, as determined by each individual Bank and communicated to Administrative Agent in writing. However, the amount of the Borrowing Base shall never be increased at any time without the unanimous consent of the Banks, notwithstanding anything else herein to the contrary. For purposes of this paragraph, the "weighted arithmetic average" of the Borrowing Base shall be determined by first multiplying the Borrowing Base proposed in writing to Administrative Agent by each Bank by such Bank's Percentage Share, and then adding the results of each such calculation, with the resultant sum being the Borrowing Base. The Borrowing Base shall represent the Required Banks' approval of the Administrative Agent's determination, in accordance with its customary lending practices, of the maximum loan amount with respect to the Borrowing Base Oil and Gas Properties and the Borrower acknowledges, for purposes of this Agreement, such determination by the Administrative Agent as being the maximum loan amount with respect to the Borrowing Base Oil and Gas Properties. In making any redetermination of the Borrowing Base, the Administrative Agent and the Banks shall apply the parameters and other credit factors consistently applied then generally being utilized by the Administrative Agent and each such Bank, respectively, for Borrowing Base redeterminations for other similarly situated borrowers. The Borrower, Required Banks and the Administrative Agent acknowledge that (a) due to the uncertainties of the oil and gas extraction process, the Borrowing Base Oil and Gas Properties are not subject to evaluation with a high degree of accuracy and are subject to potential rapid deterioration in value, and (b) for this reason and the difficulties and expenses involved in liquidating and collecting against the Borrowing Base Oil and Gas Properties, the Administrative Agent's determination of the maximum loan amount with respect to the Borrowing Base Oil and Gas Properties contains an equity cushion, which equity cushion is acknowledged by the Borrower as essential for the adequate protection of the Banks.this
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Borrowing Base Determination. (a) The Borrowing Base in effect as of the Closing Date is One Hundred Million Dollars ($100,000,000.00). The Borrowing Base shall be re-determined from time to time pursuant to the following provisions of this Section. On or before April 1, 2003, the Borrower shall furnish to the Administrative Agent information sufficient to update to an effective date of January 1, 2003, the most recent petroleum engineering reports provided to the Administrative Agent prior to Closing 10,750,000 relative to the Proved Reserves attributable to the Borrowing Base Oil and Gas PropertiesProperties and the Monthly Borrowing Base Reduction is $0.00. Upon receipt The Borrowing Base shall be automatically reduced on the first day of such information, the Administrative Agent shall, in the normal course of business make a determination of the Borrowing Base, which shall become effective upon approval each month by the Required Banks Monthly Borrowing Base Reduction beginning July 1, 2008. The Borrowing Base and subsequent written notification the Monthly Borrowing Base Reduction shall be re-determined from the Administrative Agent time to time pursuant to the Borrower, and which, subject to the other provisions of this Agreement, shall be the basis on which the Borrowing Base shall thereafter be calculated until the effective date of the next redetermination of the Borrowing Base as set forth in this Section. Thereafter, on .
(b) On or before each April 1 and October 1 until the Facility Termination Date1, beginning with October 1, 20032008, until the Borrower Maturity Date, Borrowers shall furnish to the Administrative Agent a report, in form and substance satisfactory to the Administrative AgentReserve Report, which report shall set forthout, as of each preceding January 1 or July 1, as applicable, the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties. Each report to October Reserve Report may be provided on or before each prepared by Borrowers’ engineer and shall be certified by a Responsible Officer of Borrowers. Each April 1 Reserve Report shall be a complete report prepared by independent petroleum engineers or firm of engineers reasonably acceptable to Administrative Agent relating to the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties prepared by an independent petroleum engineer or firm of engineers reasonably satisfactory to the Administrative Agent. Each report to be provided on or before each October 1 shall simply update the previous complete report, and may be prepared by the Borrower's own engineers and shall be certified by the President or Chief Financial Officer of the BorrowerProperties. Upon receipt of each such reportReserve Report or any Reserve Report delivered pursuant to Borrowers’ election under Section 2.04(c) below, the Administrative Agent shall, in the normal course of business, shall make a determination in its sole discretion of the Borrowing Base and the Monthly Borrowing Base Reduction which shall become effective upon approval by the Required Banks (if such determination will decrease the existing Borrowing Base) or all Banks (if such determination will increase or maintain the existing Borrowing Base) and subsequent written notification from the Administrative Agent to the BorrowerBorrowers, and which, subject to the other provisions of this Agreement, shall be the basis on which the Borrowing Base shall thereafter be calculated and the Monthly Borrowing Base Reduction until the effective date of the next redetermination of the Borrowing Base and the Monthly Borrowing Base 1335940v11 Reduction as set forth out in this Section 2.062.04. The A Bank’s failure to disapprove of Administrative Agent’s determination within fifteen (15) days by delivery of an alternative proposed Borrowing Base and Monthly Borrowing Base Reduction shall be deemed such Bank’s approval of Administrative Agent’s determination. For any Oil and Gas Properties which are being acquired by Loan Parties to be included as Borrowing Base Oil and Gas Properties, Administrative Agent shall be satisfied in its reasonable discretion that Borrowers are acquiring Marketable Title in addition to satisfying all other conditions relating to ownership and transfer of Borrowing Base Oil and Gas Properties. Administrative Agent may, subject to approval of the Required Banks, and must, upon the request of the Required Banks, redetermine the Borrowing Base and the Monthly Borrowing Base Reduction at any time, and from time to time, which redetermination shall be at Administrative Agent’s sole discretion and shall become effective upon approval by the Required Bank (if such determination will decrease the existing Borrowing Base) or all Banks (if such determination will increase or maintain the existing Borrowing Base) and subsequent written notification from the Administrative Agent to the Borrower Borrowers and which, subject to the other provisions of this Agreement, shall be the basis on which the Borrowing Base shall thereafter be calculated and the Monthly Borrowing Base Reduction until the effective date of the next redetermination of the Borrowing BaseBase and the Monthly Borrowing Base Reduction, as set forth out in this SectionSection 2.04; provided, that Administrative Agent shall not request more than one (1) unscheduled Borrowing Base and the Monthly Borrowing Base Reduction redetermination between the scheduled redetermination dates and, provided further, that a Bank’s failure to disapprove of Administrative Agent’s determination within fifteen (15) days by delivery of an alternative proposed Borrowing Base and Monthly Borrowing Base Reduction shall be deemed such Bank’s approval of Administrative Agent’s determination. The With respect to any unscheduled Borrowing Base and Monthly Borrowing Base Reduction redetermination, Administrative Agent may request in writing that the Borrower Borrowers provide a Reserve Report regarding the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties with an effective date not more than ninety (90) days prior to Borrower's Borrowers’ delivery of such Reserve Report to Administrative Agent, and such Reserve Report shall be delivered to Administrative Agent within ninety (90) days after Borrower's Borrowers’ receipt of such written request. The Borrower .
(c) Borrowers shall have the right to request, by written notice to Administrative Agent, one unscheduled redetermination of the Borrowing Base and the Monthly Borrowing Base Reduction between any two the scheduled redetermination dates described in Section 2.04(b). For unscheduled redeterminations thereofrequested by Borrowers of the Borrowing Base and the Monthly Borrowing Base Reduction, subject to contemporaneously providing to Administrative Agent a shall request in writing that Borrowers provide an unscheduled Reserve Report regarding the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties with an effective date not more than ninety (90) days prior to the date Borrowers’ delivery of such noticeReserve Report to Administrative Agent, and such Reserve Report shall be delivered to Administrative Agent within thirty days after Borrower’s receipt of such written request. Immediately upon redetermination of the Borrowing Base by Administrative Agent under Section 2.04, Borrowers shall pay to Administrative Agent an engineering fee as set forth in Section 2.08(c). 1335940v11
(d) If at any time the Required Banks or all the Banks, as the case may be, cannot otherwise agree on a redetermination of the Borrowing Base, then the Borrowing Base, Base shall be set (i) on the basis of the Administrative Agent's calculation of the "weighted arithmetic average" (as hereinafter calculated) of the lowest Borrowing Base, as determined Base approved by each individual a Bank and communicated to Administrative Agent in writingwriting if such lowest approved Borrowing Base increases the Borrowing Base; or (ii) on the basis of the highest approved Borrowing Base acceptable to a sufficient number of Banks to constitute Required Banks without increasing the Borrowing Base, as applicable. If the Borrowing Base is set based on the lowest approved Borrowing Base, such redetermination shall be deemed to be approved by all of the Banks, and if the Borrowing Base is set based on the highest approved Borrowing Base acceptable to a sufficient number of Banks to constitute Required Banks, such redetermination shall be deemed to be approved by the Required Bank. However, the amount of the Borrowing Base shall never be (y) increased or reaffirmed at any time without the unanimous consent or deemed consent of the BanksBanks or (z) increased above the Administrative Agent’s proposed Borrowing Base, notwithstanding anything else herein in this Agreement to the contrary. For purposes of this paragraph, the "weighted arithmetic average" Determinations of the Borrowing Base shall be determined by first multiplying conclusive as to the Borrowing Base proposed in writing Banks and the Borrowers. There is no duty, implied or explicit, of the Banks ever to Administrative Agent by each Bank by such Bank's Percentage Share, and then adding the results of each such calculation, with the resultant sum being increase the Borrowing Base. .
(e) The Borrowing Base shall represent the Required Banks' ’ approval of the Administrative Agent's ’s determination, or the determination of the Bank approving the lowest Borrowing Base, if applicable, or the determination of the Required Banks approving the highest Borrowing Base without increasing the Borrowing Base, if applicable, in accordance with its their customary lending practices, of the maximum loan Loan amount with respect to that may be supported by the Borrowing Base Oil and Gas Properties Properties, and the Borrower acknowledgesBorrowers acknowledge, for purposes of this Agreement, such determination by the Administrative Agent Agent, or the lowest approved Borrowing Base by a Required Bank, as being the maximum loan Loan amount with respect to under this Agreement that can be supported by the Borrowing Base Oil and Gas Properties. In making any exercising their discretion in redetermination of the Borrowing BaseBase and the Monthly Borrowing Base Reduction, the Administrative Agent and the other Banks shall consistently apply the parameters and other credit factors consistently applied then generally being utilized by the Administrative Agent and each such Bank, respectively, for Borrowing Base redeterminations at the time for other similarly situated borrowersborrowers based, in part, upon the Reserve Report with respect to the Borrowing Base Oil and Gas Properties. The BorrowerBorrowers, Required the Banks and the Administrative Agent acknowledge that (a) due to the uncertainties of the oil and gas extraction process, the Borrowing Base Oil and Gas Properties are not subject to evaluation with a high degree of accuracy and are subject to potential rapid deterioration in value, and (b) for this reason and the difficulties and expenses involved in liquidating and collecting against the Borrowing Base Oil and Gas Properties, the Administrative Agent's ’s determination of the maximum loan Loan amount with respect to the Borrowing Base Oil and Gas Properties contains an equity cushion, which equity cushion is acknowledged by the Borrower Borrowers as essential for the adequate protection of the Banks.
(f) Borrowers may, from time to time upon written notice to Administrative Agent, propose to add Oil and Gas Properties of Loan Parties to the Borrowing Base Oil and Gas Properties. Any such proposal to add Oil and Gas Properties of Loan Parties to the Borrowing Base Oil and Gas Properties shall be accompanied by a Reserve Report 1335940v11 applicable to such properties that conforms to the requirements of this Section 2.04, and evidence sufficient to establish that Loan Parties have, or concurrently with the increase in the Borrowing Base will have Marketable Title to such Oil and Gas Properties, and any such addition shall become effective at such time as: (a) Administrative Agent has made a determination of the amount by which the Borrowing Base would be increased as the result of such addition, (b) the conditions set out in Article IV hereof, to the extent they are applicable to such additional Oil and Gas Properties of Loan Parties, have been satisfied, and (c) unanimous approval of all the Banks. In determining the increase in the Borrowing Base pursuant to this Section, Administrative Agent and the Banks shall apply the parameters and other credit factors set out in this Section 2.04.
Appears in 1 contract
Borrowing Base Determination. The Borrowing Base in effect as of the Closing is One Hundred Forty Million Dollars ($100,000,000.00140,000,000.00). The Borrowing Base shall be re-determined from time to time semi-annually pursuant to the following provisions of this Section. On or before April October 1, 20032002, the Borrower shall furnish to the Administrative Agent information sufficient to update to an effective date of January July 1, 20032002, the most recent petroleum engineering reports Reserve Report provided to the Administrative Agent prior to Closing relative to the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties. Upon receipt of such information, the Administrative Agent Arrangers shall, in the normal course of business business, make a joint determination of the Borrowing Base, which shall become effective upon approval by the Required Banks and subsequent written notification from the Administrative Agent to the Borrower, and which, subject to the other provisions of this Agreement, shall be the basis on which the Borrowing Base shall thereafter be calculated until the effective date of the next redetermination of the Borrowing Base as set forth in this Section. Thereafter, on or before each April 1 and October 1 until the Facility Termination Date, beginning October April 1, 2003, the Borrower shall furnish to the Administrative Agent a reportReserve Report, in form and substance satisfactory to the Administrative Agent, which report shall set forth, as of each preceding January 1 or July 1, as applicable, the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties. Each report Reserve Report that is due to be provided submitted to the Administrative Agent on or before each April 1 shall be a complete report relating to the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties prepared by an independent petroleum engineer or firm of engineers reasonably satisfactory acceptable to the Administrative Agent. Each report , and each Reserve Report due to be provided submitted on or before each October 1 or each year shall be prepared under the supervision of the chief petroleum engineer of Borrower and shall simply update update, to its effective date, the previous last complete report, and may be prepared by the Borrower's own engineers and shall be certified by the President or Chief Financial Officer of the BorrowerReserve Report provided to Administrative Agent. Upon receipt of each such reportReserve Report, the Administrative Agent Arrangers shall, in the normal course of business, make a joint determination of the Borrowing Base which shall become effective upon approval by the Required Banks and subsequent written notification from the Administrative Agent to the Borrower, and which, subject to the other provisions of this Agreement, shall be the basis on which the Borrowing Base shall thereafter be calculated until the effective date of the next redetermination of the Borrowing Base as set forth in this Section 2.06. The Administrative Agent Arrangers may, subject to approval of the Required Banks, and must, upon the request of the Required Banks, redetermine the Borrowing Base at any time, and from time to time, which redetermination shall become effective upon approval by the Required Banks and subsequent written notification from the Administrative Agent to the Borrower and which, subject to the other provisions of this Agreement, shall be the basis on which the Borrowing Base shall thereafter be calculated until the effective date of the next redetermination of the Borrowing Base, as set forth in this Section. The Not more often than two times in any calendar year, the Administrative Agent may request in writing that the Borrower provide a Reserve Report regarding the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties with an effective date not more than ninety (90) days prior to Borrower's delivery of such Reserve Report to Administrative Agent, and such Reserve Report shall be delivered to Administrative Agent within ninety (90) days after Borrower's receipt of such written request. The Borrower shall have the right to request, by written notice to Administrative Agent, one unscheduled redetermination of the Borrowing Base between any two scheduled redeterminations thereof, subject to contemporaneously providing to Administrative Agent a Reserve Report with an effective date not more than ninety (90) days prior to the date of such notice. If at any time the Required Banks Arrangers cannot otherwise agree on a redetermination of the Borrowing Base, then the proposed Borrowing Base, Base shall be set on the basis of the Administrative Agent's calculation of the "weighted arithmetic average" (as hereinafter calculated) of the Borrowing Base, as determined by each individual Bank Arranger and communicated to Administrative Agent in writing, and such Borrowing Base, calculated by the Administrative Agent based on the "weighted arithmetic average" of each Borrowing Base proposed by the respective Arrangers, shall then be subject to the approval of the Required Banks. However, the amount of the Borrowing Base shall never be increased at any time without the unanimous consent of the Banks, notwithstanding anything else herein to the contrary. For purposes of this paragraph, the "weighted arithmetic average" of the Borrowing Base shall be determined by first multiplying the Borrowing Base proposed in writing to Administrative Agent by each Bank Arranger by the ratio such BankArranger's Percentage ShareShare over the sum of the Percentage Shares of all Arrangers, and then adding the results of each such calculation, with the resultant sum being the Borrowing BaseBase to be submitted to the Banks for approval as provided herein. The Borrowing Base shall represent the Required Banks' approval of the Administrative Agent's Arrangers' determination, in accordance with its their customary lending practices, of the maximum loan amount with respect to the Borrowing Base Oil and Gas Properties and the Borrower acknowledges, for purposes of this Agreement, such determination by the Administrative Agent Arrangers as being the maximum loan amount with respect to that can be supported by the Borrowing Base Oil and Gas Properties. In making any redetermination of the Borrowing Base, the Administrative Agent Arrangers and the other Banks shall apply the parameters and other credit factors consistently applied applied, then generally being utilized by the Administrative Agent Arrangers and each such Bank, respectively, for Borrowing Base redeterminations for other similarly situated borrowers. The Borrower, Required Banks and the Administrative Agent Arrangers acknowledge that (a) due to the uncertainties of the oil and gas extraction process, the Borrowing Base Oil and Gas Properties are not subject to evaluation with a high degree of accuracy and are subject to potential rapid deterioration in value, and (b) for this reason and the difficulties and expenses involved in liquidating and collecting against the Borrowing Base Oil and Gas Properties, the Administrative Agent's Arrangers' determination of the maximum loan amount with respect to the Borrowing Base Oil and Gas Properties contains an equity cushion, which equity cushion is acknowledged by the Borrower as essential for the adequate protection of the Banks.
Appears in 1 contract
Borrowing Base Determination. The Borrowing Base in effect as of the Closing is One Hundred Million Dollars ($100,000,000.00). The Borrowing Base shall be re-determined from time to time pursuant to the following provisions of this Section. On or before April 1, 20032002, the Borrower shall furnish to the Administrative Agent information sufficient to update to an effective date of January 1, 20032002, the most recent petroleum engineering reports provided to the Administrative Agent prior to Closing relative to the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties. Upon receipt of such information, the Administrative Agent shall, in the normal course of business make a determination of the Borrowing Base, which shall become effective upon approval by the Required Banks and subsequent written notification from the Administrative Agent to the Borrower, and which, subject to the other provisions of this Agreement, shall be the basis on which the Borrowing Base shall thereafter be calculated until the effective date of the next redetermination of the Borrowing Base as set forth in this Section. Thereafter, on or before each April 1 and October 1 until the Facility Termination Date, beginning October 1, 20032002, the Borrower shall furnish to the Administrative Agent a report, in form and substance satisfactory to the Administrative Agent, which report shall set forth, as of each preceding January 1 or July 1, as applicable, the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties. Each report to be provided on or before each April 1 shall be a complete report relating to the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties prepared by an independent petroleum engineer or firm of engineers reasonably satisfactory to the Administrative Agent. Each report to be provided on or before each October 1 shall simply update the previous complete report, and may be prepared by the Borrower's own engineers and shall be certified by the President or Chief Financial Officer of the Borrower. Upon receipt of each such report, the Administrative Agent shall, in the normal course of business, make a determination of the Borrowing Base which shall become effective upon approval by the Required Banks and subsequent written notification from the Administrative Agent to the Borrower, and which, subject to the other provisions of this Agreement, shall be the basis on which the Borrowing Base shall thereafter be calculated until the effective date of the next redetermination of the Borrowing Base as set forth in this Section 2.06. The Administrative Agent may, subject to approval of the Required Banks, and must, upon the request of the Required Banks, redetermine the Borrowing Base at any time, and from time to time, which redetermination shall become effective upon approval by the Required Banks and subsequent written notification from the Administrative Agent to the Borrower and which, subject to the other provisions of this Agreement, shall be the basis on which the Borrowing Base shall thereafter be calculated until the effective date of the next redetermination of the Borrowing Base, as set forth in this Section. The Administrative Agent may request in writing that the Borrower provide a Reserve Report regarding the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties with an effective date not more than ninety (90) days prior to Borrower's delivery of such Reserve Report to Administrative Agent, and such Reserve Report shall be delivered to Administrative Agent within ninety (90) days after Borrower's receipt of such written request. The Borrower shall have the right to request, by written notice to Administrative Agent, one unscheduled redetermination of the Borrowing Base between any two scheduled redeterminations thereof, subject to contemporaneously providing to Administrative Agent a Reserve Report with an effective date not more than ninety (90) days prior to the date of such notice. If at any time the Required Banks cannot otherwise agree on a redetermination of the Borrowing Base, then the Borrowing Base, shall be set on the basis of the Administrative Agent's calculation of the "weighted arithmetic average" (as hereinafter calculated) of the Borrowing Base, as determined by each individual Bank and communicated to Administrative Agent in writing. However, the amount of the Borrowing Base shall never be increased at any time without the unanimous consent of the Banks, notwithstanding anything else herein to the contrary. For purposes of this paragraph, the "weighted arithmetic average" of the Borrowing Base shall be determined by first multiplying the Borrowing Base proposed in writing to Administrative Agent by each Bank by such Bank's Percentage Share, and then adding the results of each such calculation, with the resultant sum being the Borrowing Base. The Borrowing Base shall represent the Required Banks' approval of the Administrative Agent's determination, in accordance with its customary lending practices, of the maximum loan amount with respect to the Borrowing Base Oil and Gas Properties and the Borrower acknowledges, for purposes of this Agreement, such determination by the Administrative Agent as being the maximum loan amount with respect to the Borrowing Base Oil and Gas Properties. In making any redetermination of the Borrowing Base, the Administrative Agent and the Banks shall apply the parameters and other credit factors consistently applied then generally being utilized by the Administrative Agent and each such Bank, respectively, for Borrowing Base redeterminations for other similarly situated borrowers. The Borrower, Required Banks and the Administrative Agent acknowledge that (a) due to the uncertainties of the oil and gas extraction process, the Borrowing Base Oil and Gas Properties are not subject to evaluation with a high degree of accuracy and are subject to potential rapid deterioration in value, and (b) for this reason and the difficulties and expenses involved in liquidating and collecting against the Borrowing Base Oil and Gas Properties, the Administrative Agent's determination of the maximum loan amount with respect to the Borrowing Base Oil and Gas Properties contains an equity cushion, which equity cushion is acknowledged by the Borrower as essential for the adequate protection of the Banks.
Appears in 1 contract
Borrowing Base Determination. The Borrowing Base in effect as of the Closing is One Three Hundred Fifteen Million Dollars ($100,000,000.00)315,000,000.00) based upon the Netherland Xxxxxx Report dated as of January 23, 2004, relative to the Proved Reserves attributable to the Oil and Gas Properties of the Borrower included in such Reserve Report. The Borrowing Base shall be re-determined from time to time pursuant to the following provisions of this Section. On or before each October 1 and April 1, 2003, the Borrower shall furnish to the Administrative Agent information sufficient to update to an effective date of January commencing October 1, 20032004, the most recent petroleum engineering reports provided to the Administrative Agent prior to Closing relative to the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties. Upon receipt of such information, the Administrative Agent shall, in the normal course of business make a determination of the Borrowing Base, which shall become effective upon approval by the Required Banks and subsequent written notification from the Administrative Agent to the Borrower, and which, subject to the other provisions of this Agreement, shall be the basis on which the Borrowing Base shall thereafter be calculated until the effective date of the next redetermination of the Borrowing Base as set forth in this Section. Thereafter, on or before each April 1 and October 1 until the Facility Termination Date, beginning October 1, 2003, the Borrower shall furnish to the Administrative Agent a report, in form and substance satisfactory to the Administrative AgentReserve Report, which report shall set forth, as of each preceding January July 1 or July January 1, as applicable, the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties. Each report to be provided on or before each April 1 shall be a complete report relating to the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties prepared by an independent petroleum engineer or firm of engineers reasonably satisfactory to the Administrative AgentBorrower included in such Reserve Report. Each report to be provided on or before each October 1 shall simply update the previous complete report, and Reserve Report may be prepared by the Borrower's own engineers and shall be certified by the President or Chief Financial other Responsible Officer of the Borrower. Each April Reserve Report shall be a complete report prepared by independent reservoir engineers acceptable to Administrative Agent relating to the Proved Reserves attributable to the Oil and Gas Properties of the Borrower included in such Reserve Report. Upon receipt of each such reportReserve Report, the Administrative Agent shall, in within forty-five (45) days following the normal course delivery of businesssuch Reserve Report, make a determination of the Borrowing Base which shall become effective upon approval by the Required Banks and subsequent written notification from the Administrative Agent to the Borrower, and which, subject to the other provisions of this Agreement, shall be the basis on which the Borrowing Base shall thereafter be calculated until the effective date of the next redetermination of the Borrowing Base as set forth in this Section 2.06. The Administrative Agent may, subject to approval of the Required Banks, and must, upon the request of the Required Banks, redetermine the Borrowing Base at any time, and from time to time, which redetermination shall become effective upon approval by the Required Banks and subsequent written notification from the Administrative Agent to the Borrower and which, subject to the other provisions of this Agreement, shall be the basis on which the Borrowing Base shall thereafter be calculated until the effective date of the next redetermination of the Borrowing Base, as set forth in this Section. The Administrative Agent may request shall have the right to initiate one unscheduled redetermination of the Borrowing Base between any two consecutive scheduled redeterminations thereof by requesting in writing writing, not more than once between any two consecutive scheduled deliveries of Reserve Reports, that the Borrower provide a an unscheduled Reserve Report regarding the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties of the Borrower included in such Reserve Report with an effective date not more than ninety (90) days prior to Borrower's delivery of such Reserve Report to Administrative Agent, and such Reserve Report shall be delivered to Administrative Agent within ninety (90) days after Borrower's receipt of such written request. The Borrower shall have the right to request, by written notice to Administrative Agent, one unscheduled redetermination of the Borrowing Base between any two consecutive scheduled redeterminations thereof, subject to contemporaneously providing to Administrative Agent a Reserve Report with an effective date not more than ninety (90) days prior to the date of such notice. If at any time the Required Banks cannot otherwise agree on a redetermination of the Borrowing Base, then the Borrowing Base, shall be set on the basis of the Administrative Agent's calculation of the "weighted arithmetic average" (as hereinafter calculated) of the Borrowing Base, as determined by each individual Bank and communicated to Administrative Agent in writing. However, the amount of the Borrowing Base shall never be increased at any time without the unanimous consent of the Banks, notwithstanding anything else herein to the contrary. For purposes of this paragraph, the "weighted arithmetic average" of the Borrowing Base shall be determined by first multiplying the Borrowing Base proposed in writing to Administrative Agent by each Bank by such Bank's Percentage Share, and then adding the results of each such calculation, with the resultant sum being the Borrowing Base. The Borrowing Base shall represent the Required Banks' approval of the Administrative Agent's determination, in accordance with its their customary lending practices, of the maximum loan amount with respect to the Borrowing Base Oil and Gas Properties and the Borrower acknowledges, for purposes of this Agreement, such determination by the Administrative Agent as being the maximum loan amount with respect to the Borrowing Base Oil and Gas Properties. In making any redetermination of the Borrowing Base, the Administrative Agent and the Banks shall apply the parameters and other credit factors consistently applied then generally being utilized by the Administrative Agent and each such Bank, respectively, for Borrowing Base redeterminations for other similarly situated borrowers. The Borrower, Required Banks and the Administrative Agent acknowledge that (a) due to the uncertainties of the oil and gas extraction process, the Borrowing Base Oil and Gas Properties are not subject to evaluation with a high degree of accuracy and are subject to potential rapid deterioration in value, and (b) for this reason and the difficulties and expenses involved in liquidating and collecting against the Borrowing Base Oil and Gas Properties, the Administrative Agent's determination of the maximum loan amount with respect to the Borrowing Base Oil and Gas Properties contains an equity cushion, which equity cushion is acknowledged by the Borrower as essential for the adequate protection of the Banks.
Appears in 1 contract
Borrowing Base Determination. The Borrowing Base in effect as of the Closing is One Hundred Sixty-Five Million Dollars ($100,000,000.0065,000,000). The Borrowing Base shall be re-determined from time to time pursuant to the following provisions of this Section. On or before April October 1, 20032001, the Borrower shall furnish to the Administrative Agent information sufficient to update to an effective date of January June 1, 20032001, the most recent petroleum engineering reports provided to the Administrative Agent prior to Closing relative to the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties. Upon receipt of such information, the Administrative Agent shall, in the normal course of business make a determination of the Borrowing Base, which shall become effective upon approval by the Required Banks and subsequent written notification from the Administrative Agent to the Borrower, and which, subject to the other provisions of this Agreement, shall be the basis on which the Borrowing Base shall thereafter be calculated until the effective date of the next redetermination of the Borrowing Base as set forth in this Section. Thereafter, on or before each April 1 and October 1 until the Facility Termination Date, beginning October April 1, 20032002, the Borrower shall furnish to the Administrative Agent a report, in form and substance satisfactory to the Administrative Agent, which report shall set forth, as of each preceding January 1 or July 1, as applicable, the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties. Each report to be provided on or before each April 1 shall be a complete report relating to the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties prepared by an independent petroleum engineer or firm of engineers reasonably satisfactory to the Administrative Agent. Each report to be provided on or before each October 1 shall simply update the previous complete report, and may be prepared by the Borrower's own engineers and shall be certified by the President or Chief Financial Officer of the Borrower. Upon receipt of each such report, the Administrative Agent shall, in the normal course of business, make a determination of the Borrowing Base which shall become effective upon approval by the Required Banks and subsequent written notification from the Administrative Agent to the Borrower, and which, subject to the other provisions of this Agreement, shall be the basis on which the Borrowing Base shall thereafter be calculated until the effective date of the next redetermination of the Borrowing Base as set forth in this Section 2.06. The Administrative Agent may, subject to approval of the Required Banks, and must, upon the request of the Required Banks, redetermine the Borrowing Base at any time, and from time to time, which redetermination shall become effective upon approval by the Required Banks and subsequent written notification from the Administrative Agent to the Borrower and which, subject to the other provisions of this Agreement, shall be the basis on which the Borrowing Base shall thereafter be calculated until the effective date of the next redetermination of the Borrowing Base, as set forth in this Section. The Administrative Agent may request in writing that the Borrower provide a Reserve Report regarding the Proved Reserves attributable to the Borrowing Base Oil and Gas Properties with an effective date not more than ninety (90) days prior to Borrower's delivery of such Reserve Report to Administrative Agent, and such Reserve Report shall be delivered to Administrative Agent within ninety (90) days after Borrower's receipt of such written request. The Borrower shall have the right to request, by written notice to Administrative Agent, one unscheduled redetermination of the Borrowing Base between any two scheduled redeterminations thereof, subject to contemporaneously providing to Administrative Agent a Reserve Report with an effective date not more than ninety (90) days prior to the date of such notice. If at any time the Required Banks cannot otherwise agree on a redetermination of the Borrowing Base, then the Borrowing Base, shall be set on the basis of the Administrative Agent's calculation of the "weighted arithmetic average" (as hereinafter calculated) of the Borrowing Base, as determined by each individual Bank and communicated to Administrative Agent in writing. However, the amount of the Borrowing Base shall never be increased at any time without the unanimous consent of the Banks, notwithstanding anything else herein to the contrary. For purposes of this paragraph, the "weighted arithmetic average" of the Borrowing Base shall be determined by first multiplying the Borrowing Base proposed in writing to Administrative Agent by each Bank by such Bank's Percentage Share, and then adding the results of each such calculation, with the resultant sum being the Borrowing Base. The Borrowing Base shall represent the Required Banks' approval of the Administrative Agent's determination, in accordance with its customary lending practices, of the maximum loan amount with respect to the Borrowing Base Oil and Gas Properties and the Borrower acknowledges, for purposes of this Agreement, such determination by the Administrative Agent as being the maximum loan amount with respect to the Borrowing Base Oil and Gas Properties. In making any redetermination of the Borrowing Base, the Administrative Agent and the Banks shall apply the parameters and other credit factors consistently applied then generally being utilized by the Administrative Agent and each such Bank, respectively, for Borrowing Base redeterminations for other similarly situated borrowers. The Borrower, Required Banks and the Administrative Agent acknowledge that (a) due to the uncertainties of the oil and gas extraction process, the Borrowing Base Oil and Gas Properties are not subject to evaluation with a high degree of accuracy and are subject to potential rapid deterioration in value, and (b) for this reason and the difficulties and expenses involved in liquidating and collecting against the Borrowing Base Oil and Gas Properties, the Administrative Agent's determination of the maximum loan amount with respect to the Borrowing Base Oil and Gas Properties contains an equity cushion, which equity cushion is acknowledged by the Borrower as essential for the adequate protection of the Banks.or
Appears in 1 contract
