Common use of Carbon Energy Corporation Indebtedness Clause in Contracts

Carbon Energy Corporation Indebtedness. Carbon Energy Corporation fails to make any payment of principal or interest in regard to any indebtedness whatsoever owed by it, including without limitation, pursuant to any judgment, loan agreement, guarantee, letter of credit, lease or any other agreement evidencing indebtedness, after the expiry of any applicable grace period or demand therefor, whether incurred before or after the date hereof, to any Person, where the outstanding principal amount of such indebtedness is, in the case of a single such failure, more than $100,000 or, in the case of the aggregate of all such failures, more than $500,000, unless (i) Carbon Energy Corporation is contesting the validity of such indebtedness in good faith by appropriate proceedings diligently conducted, as long as such proceedings do not involve any risk of unindemnified liability on the part of CIBC and/or PLC, (ii) the Borrower notifies CIBC of such contest, and (iii) Carbon Energy Corporation has established reasonable reserves therefor, adequate in the opinion of CIBC, in accordance with the generally accepted accounting principles in effect in Canada or the United States, as applicable, at the time of such contest.