Common use of Designation and Conversion of Restricted and Unrestricted Subsidiaries Clause in Contracts

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Section, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate a Subsidiary as an Unrestricted Subsidiary if (i) immediately before and after such designation, no Default or Event of Default exists or would exist, (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreement. (c) The Borrower may designate an Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before and after such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Section, any Person that becomes a Subsidiary of the US Borrower or any of its the Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The US Borrower may designate a Subsidiary as an Unrestricted Subsidiary if (i) immediately before and after such designation, no Default or Event of Default exists or would exist, (ii) after giving effect to such designation on a pro forma basis, the US Borrower and its the Restricted Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, Indebtedness of the US Borrower or similar agreementany Restricted Subsidiary. (c) The US Borrower may designate an Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before and after such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the US Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) ), 7.11(b), and 7.11(b7.11(c) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The US Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Section, Any Person (other than any Person Drop Down Entity) that becomes a Subsidiary of the Parent, the Borrower or any of its other Restricted Subsidiaries Subsidiary shall be classified a Restricted Subsidiary unless such Person (i) is designated as an Unrestricted Subsidiary on Schedule 7.14, as of the date hereof, (ii) is hereafter designated as an Unrestricted Subsidiary in compliance with Section 9.15(b), or (iii) is a subsidiary of an Unrestricted Subsidiary. Any Drop Down Entity shall be an Unrestricted Subsidiary unless designated by the Parent or the Borrower as a Restricted SubsidiarySubsidiary (and no Event of Default exists at the time of or results from such designation). (b) The Parent and the Borrower may designate by written notification thereof to the Administrative Agent, any other Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no Default or Event of Default exists or would exist, exist and (ii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Parent or the Borrower’s direct and (iii) indirect ownership interest in such Subsidiary and such Investment would be permitted to be made under Section 9.05. Except as provided in this Section 9.15(b), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Parent and the Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after such designation, no Default or Event warranties of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basisthe Parent, the Borrower and its the other Restricted Subsidiaries would have been contained in compliance with all each of the covenants contained Loan Documents are true and correct in this Agreement, including, without limitation, Sections 7.11(a) all material respects on and 7.11(b) as of such date as if made on and as of the end date of such redesignation except to the most recent fiscal quarter. extent (dA) All Subsidiaries any such representations and warranties are expressly limited to an earlier date, in which case, on and as of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation such redesignation, such representations and warranties shall continue to be true and correct as of such specified earlier date and (B) to the extent that any such representation and warranty is expressly qualified by materiality or by reference to Material Adverse Effect, such representation and warranty (as so qualified) shall be true and correct in all respects on and as of the date of such redesignation, (ii) no Event of Default would exist or result therefrom and (iii) the Parent and the Borrower comply with the requirements of Section 8.14, Section 8.15 and Section 9.13. Upon any such designation, an amount equal to the lesser of the fair market value of the Parent’s or the Borrower’s direct and indirect ownership interest in such Subsidiary or applicable Loan Partythe amount of the Parent’s or the Borrower’s cash investment therein. The designation of any Unrestricted Subsidiary as a Restricted previously made in such Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary deemed no longer outstanding for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date limitation on Investments under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.05.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 3.14 as of the Closing Date date of this Agreement or thereafter in writing to the Administrative Agent pursuant to this SectionAgent, any Person that becomes a Subsidiary of the Borrower or Parent or any of its their Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower or Parent may designate any Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if (i) immediately before and after giving effect to such designation, no Default or Event would exist as a result of Default exists or would exist, a breach of Section 5.12 and (ii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower fair market value of Borrower’s or Parent’s direct and its Subsidiaries indirect ownership interest in such Subsidiary and such Investment would have been in compliance with all be permitted to be made at the time of the covenants contained such designation under Section 7.4(i). Except as provided in this Agreement, including, without limitation, Sections 7.11(aSection 1.4(b), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower or Parent may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of Borrower and Parent and their Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such redesignation (or, no Default or Event if stated to have been made expressly as of Default exists or would exist an earlier date, were true and correct as of such date), (ii) after giving effect to no Default would exist, and (iii) Borrower complies with the requirements of Sections 5.12 and 5.15. Any such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary treated as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation a cash dividend in an amount equal to the fair market value of the Borrower’s or applicable Loan PartyParent’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of direct and indirect ownership interest in such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and the limitation on Investments under Section 7.4(i). (d) If, during any Indebtedness and Liens period, a Subsidiary is redesignated as either “Restricted” or “Unrestricted,” then for purposes of the calculation of EBITDA for such period, such Subsidiary will shall be deemed to be incurred by a Restricted Subsidiary have been redesignated as of the Borrower as first day of the relevant period. (e) For calculation of EBITDA for any period ending on or before the last day of the fiscal quarter in which the Effective Date occurs, such date calculation shall be calculated on a pro forma basis (inclusive of any acquisitions and/or divestitures, if any, made during the relevant calculation period and, if any such Indebtedness and/or Liens are not permitted to be incurred acquisition or divestiture has a value in excess of U.S.$25,000,000, as if such acquisition or divestiture had occurred on the first day of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenantperiod).

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated as an Unrestricted Subsidiary on Schedule 7.14 as of the date hereof or otherwise in compliance with this Section 9.08 for any designation after the Closing Date in writing to the Administrative Agent pursuant to this Sectiondate hereof, assuming compliance with Section 9.08(b), any Person that becomes a Subsidiary of the Borrower Parent or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate (on behalf of itself or the Person that owns the Equity Interests of the applicable Subsidiary) by written notification thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no neither a Default or Event of Default exists or nor a Borrowing Base Deficiency would exist, and (ii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Parent’s direct and (iii) indirect ownership interest in such Subsidiary and such Investment would be permitted to be made at the time of such designation under Section 9.05. Except as provided in this Section 9.08(b), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of the Parent, OP LLC Borrower and their respective Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such designationdate as if made on and as of the date of such redesignation (or, no Default if stated to have been made expressly as of an earlier date, were true and correct in all material respects (or, if already qualified by materiality, Material Adverse Effect or Event a similar qualification, true and correct in all respects) as of Default exists or would exist and such date), (ii) after giving effect to no Default would exist, and (iii) the Borrower complies with the requirements of Section 8.14, Section 8.22 and Section 9.15. Any such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary treated as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation a cash dividend in an amount equal to the lesser of the fair market value of the Parent’s direct and indirect ownership interest in such Subsidiary or the amount of the Borrower’s or applicable Loan Party’s cash investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary previously made for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date limitation on Investments under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.05.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Section, any Any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries Subsidiary shall be classified as a Restricted Subsidiary unless such Person (i) is designated as an Unrestricted Subsidiary on Schedule 7.14, as of the date hereof, (ii) is designated as an Unrestricted Subsidiary after the date hereof in compliance with Section 9.15(b), or (iii) is a subsidiary of an Unrestricted Subsidiary. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no neither a Default or Event of Default exists or nor a Borrowing Base Deficiency would exist, exist and (ii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Borrower’s direct and (iii) indirect ownership interest in such Subsidiary and such Investment would be permitted to be made under Section 9.05. Except as provided in this Section 9.15(b), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of the Borrower and the other Credit Parties contained in each of the Loan Documents are true and correct in all material respects on and as of such designationdate as if made on and as of the date of such redesignation except to the extent (A) any such representations and warranties are expressly limited to an earlier date, in which case, on and as of the date of such redesignation, such representations and warranties shall continue to be true and correct as of such specified earlier date and (B) to the extent that any such representation and warranty is expressly qualified by materiality or by reference to Material Adverse Effect, such representation and warranty (as so qualified) shall be true and correct in all respects on and as of the date of such redesignation, (ii) no Default or Event of Default exists or would exist and (iiiii) after giving effect to such designation on a pro forma basis, the Borrower complies with the requirements of Section 8.14, Section 8.15 and its Subsidiaries would have been in compliance with all of the covenants contained in this AgreementSection 9.13. Upon any such designation, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the lesser of the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary or applicable Loan Partythe amount of the Borrower’s cash investment therein. The designation of any Unrestricted Subsidiary as a Restricted previously made in such Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary deemed no longer outstanding for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date limitation on Investments under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.05.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Sectionby the Borrower in accordance with clause (b) below, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries after the date hereof (whether by formation, acquisition or merger) shall be classified as a Restricted Subsidiary. On the date hereof, all Subsidiaries of the Borrower are Restricted Subsidiaries. (b) The Borrower may designate designate, by prior or concurrent written notice thereof to the Administrative Agent, any Restricted Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if Subsidiary, provided that (i) both before, and immediately before and after giving effect, to such designation, (A) no Default or Default, Event of Default or Borrowing Base Deficiency exists or would existresult from such designation, (iiB) after giving effect the Pro Forma Net Leverage Ratio shall not exceed 3.50 to such designation 1.00 and the Borrower shall be in compliance, on a pro forma basis, with the Borrower financial covenant set forth in Section 9.01(b) (determined on a pro forma basis using Current Assets and its Subsidiaries would Current Liabilities as of the last day of the Borrower’s most recently ended fiscal quarter for which financial statements have been in compliance with all delivered pursuant to Section 8.01(a) or (b)) and (C) the representations and warranties of the covenants Credit Parties and the Restricted Subsidiaries contained in this AgreementAgreement and each of the other Loan Documents shall be true and correct in all material respects (except that any representation and warranty that is qualified by materiality shall be true and correct in all respects) on and as of such date as if made on and as of the date of such designation (or, includingif stated to have been made expressly as of an earlier date, without limitation, Sections 7.11(a), 7.11(b), were true and 7.11(ccorrect in all material respects (except that any representation and warranty that is qualified by materiality shall be true and correct in all respects) as of the end of the most recent fiscal quartersuch date); and (iiiii) no such Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as is not a “restricted subsidiary” for purposes of any indenture, credit agreement, indenture or similar agreement. other agreement governing Debt of the Credit Parties or a Restricted Subsidiary; (ciii) The Borrower may designate an Unrestricted Subsidiary such designation shall be deemed to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before and after such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary on the date of such designation and such designation shall be permitted only to the extent such Investment is permitted under Section 9.05 on the date of such designation; (iv) such designation shall be deemed to be a Disposition pursuant to which the provisions of Section 2.07(f) shall apply; (v) after giving effect to such designation, the Borrower is in compliance with the requirements of Section 9.20; and (vi) the Administrative Agent shall have received a certificate of a Responsible Officer, in form and substance reasonably satisfactory to the Administrative Agent, certifying as to the satisfaction of the conditions and matters set forth in clauses (i)-(v) above (and in the case of clause (i)(B) above, setting forth reasonably detailed calculations demonstrating that the Pro Forma Net Leverage Ratio will not exceed 3.50 to 1.00 and the Borrower will be in compliance, on a pro forma basis, with the financial covenant set forth in Section 9.01(b) (determined on a pro forma basis using Current Assets and Current Liabilities as of the last day of the Borrower’s most recently ended fiscal quarter for which financial statements have been delivered pursuant to Section 8.01(a) or applicable (b))). Except as provided in this Section 1.06, no Subsidiary may be designated (and no Restricted Subsidiary may be redesignated) as an Unrestricted Subsidiary. (c) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements for an Unrestricted Subsidiary set forth in Section 9.20, it shall thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement (and, for the avoidance of doubt, any Investment, Debt and Liens of such Subsidiary existing at such time shall be deemed to be incurred by such Subsidiary as of such time and, if such Investments, Debt and Liens are not permitted to be incurred as of such time under Article IX, an Event of Default shall occur). (d) The Borrower may designate, by prior or concurrent written notice thereof to the Administrative Agent any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that (i) both before, and immediately after giving effect, to such designation, (A) no Default, Event of Default or Borrowing Base Deficiency exists or would result from such designation, (B) the Pro Forma Net Leverage Ratio shall not exceed 3.50 to 1.00 and the Borrower shall be in compliance, on a pro forma basis, with the financial covenant set forth in Section 9.01(b) (determined on a pro forma basis using Current Assets and Current Liabilities as of the last day of the Borrower’s most recently ended fiscal quarter for which financial statements have been delivered pursuant to Section 8.01(a) or (b)) and (C) the representations and warranties of the Credit Parties and the Restricted Subsidiaries contained in this Agreement and each of the other Loan Party’s investment therein. The Documents shall be true and correct in all material respects (except that any representation and warranty that is qualified by materiality shall be true and correct in all respects) on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects (except that any representation and warranty that is qualified by materiality shall be true and correct in all respects) as of such date), (ii) the designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness Investment, Debt, or Liens of such Subsidiary existing at such time. , and the Borrower shall be in compliance with Article IX after giving effect to such designation, (fiii) Ifimmediately after giving effect to such designation, at any time, any Unrestricted the Borrower and such Subsidiary would fail to meet shall be in compliance with the requirements of Section 8.14 and (iv) the definition Administrative Agent shall have received a certificate of Unrestricted Subsidiarya Responsible Officer, it will thereafter cease in form and substance reasonably satisfactory to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed the Administrative Agent, certifying as to be incurred by a Restricted Subsidiary the satisfaction of the Borrower as conditions and matters set forth in clauses (i)-(iii) above (and in the case of such date andclause (i)(B) above, if such Indebtedness and/or Liens are setting forth reasonably detailed calculations demonstrating that the Pro Forma Net Leverage Ratio will not permitted exceed 3.50 to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, 1.00 and the Borrower will be in default compliance, on a pro forma basis, with the financial covenant set forth in Section 9.01(b) (determined on a pro forma basis using Current Assets and Current Liabilities as of such covenantthe last day of the Borrower’s most recently ended fiscal quarter for which financial statements have been delivered pursuant to Section 8.01(a) or (b))).

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Section, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate any Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist, (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all of the covenants contained set forth in this AgreementSections 7.14 and 7.15, including, without limitation, Sections 7.11(a), 7.11(b), such compliance to be determined on the basis of the financial information most recently delivered to the Administrative Agent and 7.11(cthe Lenders pursuant to Section 6.01(a) or (b) as though such Investment had been consummated as of the end first day of the most recent fiscal quarter; and period covered thereby, (iiiiv) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indentureindenture or agreement governing Unsecured Note Indebtedness and (v) in the case of a Subsidiary which is already classified as a Restricted Subsidiary (other than an Immaterial Subsidiary), credit agreementthe Borrower has obtained the prior written consent of the Administrative Agent and the Required Lenders. Except as provided in this Section, or similar agreementno Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist and (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all of the covenants contained set forth in this AgreementSections 7.14 and 7.15, including, without limitation, Sections 7.11(asuch compliance to be determined on the basis of the financial information most recently delivered to the Administrative Agent and the Lenders pursuant to Section 6.01(a) and 7.11(bor (b) as though such Investment had been consummated as of the end first day of the most recent fiscal quarterperiod covered thereby. (d) All The Borrower will not, and will not permit any of the Restricted Subsidiaries to Guarantee any Indebtedness or other obligations of an any Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. Subsidiary. (e) The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, the Borrower or any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 6.8 as of the Closing Date date of this Agreement or thereafter in writing to the Administrative Agent pursuant to this SectionAgent, any Person that becomes a Subsidiary of the Borrower Borrower, the Guarantor or any of its their Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower Guarantor may designate any Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if (i) immediately before the representations and warranties of the Guarantor and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), and (ii) after giving effect to such designation, no Default or Event of Default exists or would exist; provided, (ii) after giving effect to such designation on a pro forma basishowever, that the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained Guarantor may not designate EDC as an Unrestricted Subsidiary. Except as provided in this AgreementSection, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower Guarantor may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Guarantor and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), and (ii) after giving effect to such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarterexist. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Sectionby the Borrower in accordance with Section 1.07(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries after the Effective Date (whether by formation, acquisition, merger or otherwise) shall be classified as a Restricted Subsidiary. On the date hereof, there are no Subsidiaries. (b) The Borrower may designate by prior written notice thereof to the Administrative Agent, any Restricted Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if Subsidiary; provided that (i) both immediately before before, and immediately after giving effect, to such designation, (A) no Default or Event of Default or Borrowing Base Deficiency exists or would exist, (ii) after giving effect to result from such designation and (B) the Borrower shall be in compliance, on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained set forth in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(cSection 9.01; (ii) as of the end of the most recent fiscal quarter; and (iii) no such Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as is not a “restricted subsidiary” for purposes of any indenture, credit agreement, indenture or similar agreement. other agreement governing Debt for borrowed money of the Borrower or a Restricted Subsidiary; (ciii) The Borrower may designate an Unrestricted Subsidiary such designation shall be deemed to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before and after such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary and such designation shall be permitted only to the extent such Investment is permitted under Section 9.05 on the date of such designation (without regard to any future fluctuations in value); (iv) such designation shall be deemed to be a Disposition pursuant to which the provisions of Section 2.07(e) and Section 9.12 shall apply; (v) after giving effect to such designation, such Subsidiary is in compliance with the requirements of Section 8.18; and (vi) the Administrative Agent shall have received a certificate of a Responsible Officer, in form and substance reasonably satisfactory to the Administrative Agent, certifying as to the satisfaction of the conditions and matters set forth in clauses (i)-(v) above (and in the case of clause (i)(B) above, setting forth reasonably detailed calculations demonstrating compliance on a pro forma basis with the covenants set forth in Section 9.01). Except as provided in this Section 1.07, no Subsidiary may be designated (and no Restricted Subsidiary may be redesignated) as an Unrestricted Subsidiary. (c) The Borrower may designate by prior written notice thereof to the Administrative Agent any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that (i) both immediately before, and immediately after giving effect, to such designation, (A) no Event of Default or applicable Borrowing Base Deficiency exists or would result from such designation, (B) the Borrower shall be in compliance, on a pro forma basis, with the covenants set forth in Section 9.01, (C) the representations and warranties of the Loan Party’s investment therein. The Parties contained in this Agreement and each of the other Loan Documents shall be true and correct in all material respects (except that any representation and warranty that is qualified by materiality shall be true and correct in all respects) on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects (except that any representation and warranty that is qualified by materiality shall be true and correct in all respects) as of such date), (iii) the designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute be deemed to be the incurrence at the time of designation of any Indebtedness Investment, Debt, or Liens of such Subsidiary existing at such time. , and the Borrower shall be in compliance with Article IX after giving effect to such designation, (fiv) Ifimmediately after giving effect to such designation, at any time, any Unrestricted the Borrower and such Subsidiary would fail to meet shall be in compliance with the requirements of Section 8.14 and Section 8.17 and (v) the definition Administrative Agent shall have received a certificate of Unrestricted Subsidiarya Responsible Officer, it will thereafter cease in form and substance reasonably satisfactory to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed the Administrative Agent, certifying as to be incurred by a Restricted Subsidiary the satisfaction of the Borrower as conditions and matters set forth in clauses (i)-(iv) above (and in the case of such date andclause (i)(B) above, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under setting forth reasonably detailed calculations demonstrating compliance on a pro forma basis with the covenants set forth in Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.01).

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 4.13 as of the Closing Effective Date in writing to the Administrative Agent pursuant to this Sectionor thereafter, assuming compliance with Section 6.15(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by prior written notice thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, (A) the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), and (B) no Default or Event of Default exists or would existresult therefrom (and the Borrower shall be in compliance, (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained set forth in this AgreementSection 7.13); (ii) such Subsidiary (A) is not the owner or the operator, includingby contract or otherwise, without limitationof any Oil and Gas Interests included in the Borrowing Base Properties and (B) is not a guarantor or the primary obligor with respect to any indebtedness, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarterliabilities or other obligations under any Senior Notes; and (iii) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreement. (c) The Borrower may designate an Unrestricted Subsidiary the Investment deemed to be a Restricted made in such Subsidiary if after giving effect pursuant to such designation, (i) immediately before and after such designation, no Default or Event the next sentence would be permitted to be made at the time of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiariesunder Section 7.06. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Restricted Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such an Unrestricted Subsidiary at the date of designation in an amount equal to the aggregate amount of the Borrower’s or any Restricted Subsidiary’s Investments previously made in or to such Subsidiary. Except as provided in this Section 6.15(b), no Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. (c) The Borrower may designate by prior written notice thereof to the Administrative Agent any Unrestricted Subsidiary to be a Restricted Subsidiary if (i) immediately prior, and after giving effect to such designation, the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), (ii) no Default exists or would result therefrom (and the Borrower shall be in compliance, on a pro forma basis, with the covenants set forth in Section 7.13) and (iii) the Borrower is in compliance with the requirements of Section 6.09. Any such designation shall (x) be treated as a cash dividend in an amount equal to the lesser of the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary or applicable Loan Partythe amount of the Borrower’s cash investment therein. The designation previously made for purposes of the limitation on Investments under Section 7.06(b) or under any Unrestricted Subsidiary other subsection of Section 7.06, as a Restricted Subsidiary shall the case may be, and (y) constitute the incurrence at the time of such designation of any Investment, Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated The Borrower may designate any Subsidiary to be an Unrestricted Subsidiary; provided that at the time of such designation and immediately after giving effect thereto (i) no Default shall exist, (ii) the Closing Date representations and warranties of the Loan Parties set forth in writing this Agreement and the other Loan Documents will be true and correct in all material respects as if remade at the time of such designation, except to the Administrative Agent pursuant extent such representations and warranties specifically refer to this Sectionan earlier date, in which case they were true and correct in all material respects as of such earlier date (provided that such materiality qualifier shall not be applicable to any representation and warranty that already is qualified or modified by materiality in the text thereof) and (iii) such Subsidiary does not, at the time of designation and does not at any time thereafter while it is an Unrestricted Subsidiary, Guarantee or otherwise become directly or indirectly liable with respect to, or grant any Liens on any of its property to secure, any Person that becomes a Subsidiary Indebtedness of the Borrower or any Restricted Subsidiary or any obligations of its the Borrower or any Restricted Subsidiaries Subsidiary in respect of any Sale and Leaseback Transaction. Designation by the Borrower pursuant to this Section shall be classified deemed to be a representation and warranty by the Borrower as a Restricted Subsidiaryof such date as to the matters specified in this Section. (b) The Borrower may designate a Subsidiary as an Unrestricted Subsidiary if (i) immediately before and after such designation, no Default or Event of Default exists or would exist, (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreement. (c) The Borrower may designate an Unrestricted Subsidiary to be a Restricted Subsidiary if Subsidiary, provided that at the time of such designation and after giving effect to such designationthereto, (i) immediately before such Unrestricted Subsidiary shall not have outstanding Indebtedness, other than Indebtedness permitted under Section 7.02, or Liens on any of its property, other than Liens permitted under Section 7.01 (in each case taking into account the other Indebtedness of Restricted Subsidiaries, and after such designation, no Default or Event the Liens on property of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all Restricted Subsidiaries, then existing), (ii) no Default shall exist and (iii) the representations and warranties of the covenants contained Loan Parties set forth in this AgreementAgreement and the other Loan Documents will be true and correct in all material respects as if remade at the time of such designation, includingexcept to the extent such representations and warranties specifically refer to an earlier date, without limitation, Sections 7.11(a) in which case they were true and 7.11(b) correct in all material respects as of such earlier date (provided that such materiality qualifier shall not be applicable to any representation and warranty that already is qualified or modified by materiality in the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment thereintext thereof). The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence by such Restricted Subsidiary, at the time of designation designation, of any (x) all Indebtedness or Liens of such Restricted Subsidiary and (y) all Liens on property of such Restricted Subsidiary existing at such time. (fc) IfThe Borrower shall not, at and shall not permit any timeof its Restricted Subsidiaries to, Guarantee, or grant or otherwise permit a Lien on any of its or their property to secure, any Indebtedness of an Unrestricted Subsidiary would fail to meet the requirements of the definition or any obligations of Unrestricted SubsidiarySubsidiary in respect of any Sale and Leaseback Transaction, it will thereafter cease other than (i) Liens on Equity Interests of an Unrestricted Subsidiary to be secure Indebtedness of such Unrestricted Subsidiary that is non-recourse to the Borrower and its Restricted Subsidiaries and (ii) Guarantees of Indebtedness of Unrestricted Subsidiaries in an aggregate amount not to exceed 2.5% of Consolidated Net Tangible Assets at the time of incurrence or assumption thereof. As used in this paragraph (c), “non-recourse” means Indebtedness of an Unrestricted Subsidiary for purposes which recourse to the Borrower or any Restricted Subsidiary, whether contractual or as a matter of this Agreement and any Indebtedness and Liens law, for non-payment of such Subsidiary will be deemed Indebtedness is limited to be incurred Equity Interests issued by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenantUnrestricted Subsidiary.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 7.14 as of the Closing Date in writing to the Administrative Agent pursuant to this Sectiondate hereof or thereafter, assuming compliance with Section 9.06(b), any Person that becomes a Subsidiary of the Borrower Parent or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary (other than the Borrower), including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no Default or neither an Event of Default exists or nor a Borrowing Base Deficiency would exist, (ii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Parent’s direct and indirect ownership interest in such Subsidiary and such Investment would be permitted to be made at the time of such designation under Section 9.05(i), and (iii) no such Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as is not a “restricted subsidiary” for purposes of or guarantor with respect to any indenturePermitted Senior Unsecured Notes. Except as provided in this Section 9.06(b), credit agreement, or similar agreementno Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of the Borrower, the Parent and its other Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default exists or would exist and (iiiii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance complies with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted SubsidiarySection 8.14, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement Section 8.16 and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.14.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this SectionSection 5.15, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries after the Closing Date shall be classified as a Restricted Subsidiary. (b) The Borrower may designate any Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if Subsidiary, provided that (i) any such designation shall be deemed to be an Investment on the date of such designation in an Unrestricted Subsidiary in an amount equal to the sum of the (A) the fair market value of the outstanding Investments of the Borrower and the Restricted Subsidiaries in such Unrestricted Subsidiary and (B) the aggregate principal amount of any Indebtedness owed by such Unrestricted Subsidiary to the Borrower and its Restricted Subsidiaries immediately before prior to such designation, all calculated, on a consolidated basis in accordance with GAAP, (ii) the representations and warranties of the Loan Parties contained in each of the Loan Documents shall be true and correct in all material respects on and as of the date of such designation as if made on and as of such date or, if stated to have been made expressly as of an earlier date, were true and correct all material respects as of such earlier date (except to the extent that any such representations are qualified as to “materiality”, “Material Adverse Effect” or similar language, in which case such representations and warranties shall be true and correct in all respects), (iii) after giving effect to such designation, no Default or Event of Default exists or would exist, (iiiv) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in compliance with all the Incurrence Test, (v) such Subsidiary shall be treated as an “Unrestricted Subsidiary” for purposes of any indenture or agreement governing notes which is permitted under the terms of this Agreement and to which any Loan Party is or becomes a party, (vi) the Investment represented by such designation shall be permitted under Section 7.4(o) and (vii) the Borrower shall provide to the Administrative Agent an Officer’s Certificate in form reasonably satisfactory to the Administrative Agent to the effect that each of the covenants contained foregoing conditions has been satisfied. Except as provided in this AgreementSection, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Restricted Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct all material respects on and as of the date of such designation as if made on and as of the date of such designation or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such earlier date (except to the extent that any such representations are qualified as to “materiality”, “Material Adverse Effect” or similar language, in which case such representations and warranties shall be true and correct in all respects), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist and (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarterIncurrence Test. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Section, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate any Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist, (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all of the covenants contained set forth in this AgreementSections 7.16 and 7.17, including, without limitation, Sections 7.11(a), 7.11(b), such compliance to be determined on the basis of the financial information most recently delivered to the Administrative Agent and 7.11(cthe Lenders pursuant to Section 6.01(a) or (b) as though such Investment had been consummated as of the end first day of the most recent fiscal quarter; and period covered thereby, (iiiiv) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indentureindenture or agreement governing Unsecured Note Indebtedness and (v) in the case of a Subsidiary which is already classified as a Restricted Subsidiary, credit agreementthe Borrower has obtained the prior written consent of the Administrative Agent and the Required Lenders. Except as provided in this Section, or similar agreementno Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist and (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all of the covenants contained set forth in this AgreementSections 7.16 and 7.17, including, without limitation, Sections 7.11(asuch compliance to be determined on the basis of the financial information most recently delivered to the Administrative Agent and the Lenders pursuant to Section 6.01(a) and 7.11(bor (b) as though such Investment had been consummated as of the end first day of the most recent fiscal quarterperiod covered thereby. (d) All The Borrower will not, and will not permit any of the Restricted Subsidiaries to Guarantee any Indebtedness or other obligations of an any Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. Subsidiary. (e) The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, the Borrower or any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.77 [SEMGROUP ENERGY PARTNERS CREDIT AGREEMENT]

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 7.14 as of the Closing Date in writing to the Administrative Agent pursuant to this Sectiondate hereof or thereafter, assuming compliance with Section 9.24(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries (other than any Subsidiary of an Unrestricted Subsidiary) shall be classified as a Restricted Subsidiary. Any Person that becomes a Subsidiary of any Unrestricted Subsidiary shall be automatically classified as an Unrestricted Subsidiary. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary other than MEMP GP, including a newly formed or newly acquired Subsidiary (other than any Subsidiary of an Unrestricted Subsidiary), as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no neither a Default or Event of Default exists or nor a Borrowing Base Deficiency would exist, exist and (ii) after giving effect to such designation on is deemed to be a pro forma basis, cash Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Borrower’s direct and (iiiindirect ownership interest in such Subsidiary and such Investment would be permitted to be made at the time of such designation under Section 9.05(h) or Section 9.05(j). Except as provided in this Section 9.24(b), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default exists or would exist and (iiiii) after giving effect to the Borrower complies with the requirements of Section 8.14, Section 8.17 and Section 9.15. Any such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary treated as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation a cash dividend in an amount equal to the lesser of the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of direct and indirect ownership interest in such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet or the requirements amount of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary Borrower’s cash investment previously made for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date limitation on Investments under Section 7.01 and/or 9.05(h) or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.05(j).

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Sectionby the Borrower and approved by the Administrative Agent and the Majority Lenders in accordance with clause (b) below, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries (whether by formation, acquisition or merger) shall be classified as a Restricted Subsidiary. (b) The Any Subsidiary of the Borrower (including a newly formed or newly acquired Subsidiary), excluding any Guarantor, may designate a Subsidiary be designated (or redesignated) as an Unrestricted Subsidiary if (i) immediately before the Administrative Agent shall have received (1) a written request from the Borrower specifying the applicable Subsidiary and after such other information as the Administrative Agent may reasonably request, (2) the written consent of the Administrative Agent and the Majority Lenders approving such designation, and (3) a certificate of a Responsible Officer of the Borrower certifying that no Default or Event of Default exists shall then exist or would exist, result from such designation (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(bdesignation), and 7.11(c(ii) such designation is deemed to be an Investment in an amount equal to the fair market value of Borrower’s direct and indirect ownership interest in such Subsidiary and such Investment would be permitted under Section 7.2 to be made at the time of such designation. Except as of the end of the most recent fiscal quarter; and (iii) provided in this Section 1.6(b), no Subsidiary may be designated (and no Restricted Subsidiary may be redesignated) as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The If, at any time, any Unrestricted Subsidiary would fail to meet the requirements for an Unrestricted Subsidiary set forth in Section 6.18, it shall thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness of such Subsidiary shall be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness is not permitted to be incurred as of such date under Section 7.3, the Borrower shall be in default of such covenant. (d) Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such redesignation (or, no Default or Event if stated to have been made expressly as of Default exists or would exist an earlier date, were true and correct as of such date), (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time, and the Borrower is in compliance with Sections 7.1 and 7.3 after giving effect to such designation, (iii) no Default or Event of Default then exists or would result from such redesignation (after giving effect to such redesignation), and (iv) the Borrower complies, or causes such Subsidiary to comply, with the requirements of Sections 6.16 and 6.18. Any such designation shall be evidenced by a certificate of a Responsible Officer of the Borrower delivered to the Administrative Agent prior to such designation certifying that the conditions of this Section 1.6(c) are satisfied as of the date of such designation (and, as a condition precedent to the effectiveness of any such designation, the Borrower shall deliver to the Administrative Agent a certificate setting forth in reasonable detail the calculations demonstrating compliance on a pro forma basis with the covenants set forth in Section 7.13). (fe) If, at any time, any Unrestricted No Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to may be designated as an Unrestricted Subsidiary hereunder unless it is also designated as an “Unrestricted Subsidiary” for purposes of this Agreement any Indenture Debt Documents and any Indebtedness and Liens of such (ii) no Subsidiary will designated as an Unrestricted Subsidiary may be deemed to be incurred by designated as a Restricted Subsidiary hereunder unless it is also designated as a “Restricted Subsidiary” for purposes of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenantany Indenture Debt Documents.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on SCHEDULE 6.8 as of the Closing Date date of this Agreement or thereafter in writing to the Administrative Agent pursuant to this SectionAgent, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate any Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if (i) immediately before the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), and (ii) after giving effect to such designation, no Default or Event of Default exists or would exist; PROVIDED, (ii) after giving effect to such designation on a pro forma basisHOWEVER, that the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained may not designate either EDC or SOC as Unrestricted Subsidiaries. Except as provided in this AgreementSection, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), and (ii) after giving effect to such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarterexist. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this SectionSection or as otherwise defined as an Unrestricted Subsidiary pursuant to clause (b) or (c) of the definition thereof, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Subject to the limitations set forth in the definition of “Unrestricted Subsidiary” and the following sentence, a Responsible Officer of the Borrower may designate any Subsidiary (including (x) a newly formed or newly acquired Subsidiary and (y) any Subsidiary that is formed after the Closing Date solely for the purpose of acquiring MLP Units purchased or acquired after the Closing Date (provided that, (1) such Subsidiary purchases or acquires such MLP Units from any Person other than the Borrower or any Restricted Subsidiary and (2) the capital stock in such Subsidiary shall constitute Collateral)) as an Unrestricted Subsidiary if (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist, (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all the Financial Covenant as of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(blast day of the immediately preceding Test Period for which a Compliance Certificate has been delivered (determined on a Pro Forma Basis giving effect to such designation), and 7.11(c) as of the end of the most recent fiscal quarter; and (iiiiv) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indentureindenture or agreement governing Indebtedness in an aggregate principal amount of at least $25,000,000. Notwithstanding the foregoing, credit agreementthe Borrower may not designate (A) the MLP GP or (B) any holder of MLP GP Units as an Unrestricted Subsidiary. The designation of any Restricted Subsidiary as an Unrestricted Subsidiary shall constitute an Investment by the Borrower and the Restricted Subsidiaries therein at the date of designation in an amount equal to the net book value of their aggregate investments therein at the time of such designation. In the event any Person becomes a Subsidiary as a result of the Borrower or a Restricted Subsidiary making a further Investment (an “Investment Increase”) in a Person in which the Borrower or such Restricted Subsidiary had previously made or had an Investment and such Person was not then a Subsidiary, the Borrower or similar agreementsuch Restricted Subsidiary may designate such Subsidiary as an Unrestricted Subsidiary without any change or adjustment in the amount of any Investment under Section 7.02 other than giving effect to the amount of such Investment Increase. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist and (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) Financial Covenant as of the end last day of the most recent fiscal quarter. immediately preceding Test Period for which a Compliance Certificate has been delivered (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary determined on a Pro Forma Basis giving effect to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment thereindesignation). The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing Any Person (other than any DevCo prior to the Administrative Agent pursuant to this Section, any Person date on which it is a Wholly-Owned Subsidiary) that becomes a Subsidiary of the Parent, the Borrower or any of its other Restricted Subsidiaries Subsidiary shall be classified as a Restricted Subsidiary unless such Person (i) is designated as an Unrestricted Subsidiary on Schedule 7.14, as of the date hereof, (ii) is hereafter designated as an Unrestricted Subsidiary in compliance with Section 9.18(b), or (iii) is a subsidiary of an Unrestricted Subsidiary. Each DevCo shall be an Unrestricted Subsidiary until such time that such DevCo is a Wholly-Owned Subsidiary, and shall thereafter be a Restricted Subsidiary for purposes of the Loan Documents. (b) The Parent and the Borrower may designate by written notification thereof to the Administrative Agent, any other Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no Default or Event of Default exists or would exist, exist and (ii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Parent or the Borrower’s direct and (iii) indirect ownership interest in such Subsidiary and such Investment would be permitted to be made under Section 9.05. Except as provided in this Section 9.18(b), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Parent and the Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after such designation, no Default or Event warranties of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basisthe Parent, the Borrower and its the other Restricted Subsidiaries would have been contained in compliance with all each of the covenants contained Loan Documents are true and correct in this Agreement, including, without limitation, Sections 7.11(a) all material respects on and 7.11(b) as of such date as if made on and as of the end date of such redesignation except to the most recent fiscal quarter. extent (dA) All Subsidiaries any such representations and warranties are expressly limited to an earlier date, in which case, on and as of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation such redesignation, such representations and warranties shall continue to be true and correct as of such specified earlier date and (B) to the extent that any such representation and warranty is expressly qualified by materiality or by reference to Material Adverse Effect, such representation and warranty (as so qualified) shall be true and correct in all respects on and as of the date of such redesignation, (ii) no Event of Default would exist or result therefrom and (iii) the Parent and the Borrower comply with the requirements of Section 8.14, Section 8.16 and Section 9.15. Upon any such designation, an amount equal to the lesser of the fair market value of the Parent’s or the Borrower’s direct and indirect ownership interest in such Subsidiary or applicable Loan Partythe amount of the Parent’s or the Borrower’s cash investment thereinpreviously made in such Subsidiary shall be deemed no longer outstanding for purposes of the limitation on Investments under Section 9.05. The designation of any Unrestricted Subsidiary Notwithstanding a foregoing, a DevCo may not be designated as a Restricted Subsidiary shall constitute the incurrence at the until such time of designation of as it becomes a Wholly-Owned Subsidiary. Furthermore, immediately upon any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted DevCo becoming a Wholly-Owned Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement the Parent and any Indebtedness and Liens of such Subsidiary will the Borrower shall be deemed to be incurred by automatically designate such DevCo as a Restricted Subsidiary and shall be required to take each of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under actions required by this Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.18(c).

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 7.14 as of the Closing Date in writing to the Administrative Agent pursuant to this Sectiondate hereof or thereafter, assuming compliance with Section 9.20(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no neither a Default or Event of Default exists or nor a Borrowing Base Deficiency would exist, exist and (ii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Borrower’s direct and (iii) indirect ownership interest in such Subsidiary and such Investment would be permitted to be made at the time of such designation under Section 9.05(i). Except as provided in this Section 9.20(b), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such designationdate as if made on and as of the date of such redesignation, except that (A) to the extent any such representations and warranties are expressly limited to an earlier date, such representations and warranties shall continue to be true and correct in all material respects as of such specified earlier date and (B) to the extent that any such representation and warranty is qualified by materiality, such representation and warranty (as so qualified) shall continue to be true and correct in all respects, (ii) no Default or Event of Default exists or would exist and (iiiii) after giving effect to the Borrower otherwise complies with the requirements of Section 8.14, Section 8.16 and Section 9.15. Any such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary treated as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation a cash dividend in an amount equal to the lesser of the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary or applicable Loan Partythe amount of the Borrower’s cash investment thereinpreviously made for purposes of the limitation on Investments under Section 9.05(i). The designation Any Subsidiary of any an Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease also be deemed to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenantSubsidiary.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 6.8 as of the Closing Date date of this Agreement or thereafter in writing to the Administrative Agent pursuant to this SectionSection 7.1.7, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may (x) designate any Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary or (y) merge a Restricted Subsidiary with an Unrestricted Subsidiary in which such Restricted Subsidiary is not the surviving entity only if (i) immediately before the representations and after warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such designation or merger (or, no Default or Event if stated to have been made expressly as of Default exists or would existan earlier date, were true and correct as of such date), (ii) after giving effect to such designation on a pro forma basisor merger, the Borrower and its Subsidiaries no Default or Event of Default would have been in compliance with all of the covenants contained in this Agreementexist, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) in the case of a Subsidiary which is already classified as a Restricted Subsidiary or a merger of a Restricted Subsidiary with an Unrestricted Subsidiary in which such Restricted Subsidiary is not the surviving entity, the Borrower has obtained the prior written consent of the Administrative Agent and the Required Lenders to such designation or merger. Except as provided in this Section, no Restricted Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementmay merge with an Unrestricted Subsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), and (ii) after giving effect to such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarterexist. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Section, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate any Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist, (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all of the covenants contained set forth in this AgreementSections 7.16 and 7.17, including, without limitation, Sections 7.11(a), 7.11(b), such compliance to be determined on the basis of the financial information most recently delivered to the Administrative Agent and 7.11(cthe Lenders pursuant to Section 6.01(a) or (b) as though such Investment had been consummated as of the end first day of the most recent fiscal quarter; and period covered thereby, (iiiiv) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indentureindenture or agreement governing Unsecured Note Indebtedness and (v) in the case of a Subsidiary which is already classified as a Restricted Subsidiary, credit agreementthe Borrower has obtained the prior written consent of the Administrative Agent and the Required Lenders. Except as provided in this Section, or similar agreementno Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist and (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all of the covenants contained set forth in this AgreementSections 7.16 and 7.17, including, without limitation, Sections 7.11(asuch compliance to be determined on the basis of the financial information most recently delivered to the Administrative Agent and the Lenders pursuant to Section 6.01(a) and 7.11(bor (b) as though such Investment had been consummated as of the end first day of the most recent fiscal quarterperiod covered thereby. (d) All The Borrower will not, and will not permit any of the Restricted Subsidiaries to Guarantee any Indebtedness or other obligations of an any Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. Subsidiary. (e) The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, the Borrower or any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 7.14 as of the Closing Date in writing to the Administrative Agent pursuant to this Sectiondate hereof or thereafter, assuming compliance with Section 9.24(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries (other than any Subsidiary of an Unrestricted Subsidiary) shall be classified as a Restricted Subsidiary. Any Person that becomes a Subsidiary of any Unrestricted Subsidiary shall be automatically classified as an Unrestricted Subsidiary. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary, including a newly formed or newly acquired Subsidiary (other than any Subsidiary of an Unrestricted Subsidiary), as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no neither a Default or Event of Default exists or nor a Borrowing Base Deficiency would exist, exist and (ii) after giving effect to such designation on is deemed to be a pro forma basis, cash Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Borrower’s direct and (iiiindirect ownership interest in such Subsidiary and such Investment would be permitted to be made at the time of such designation under Section 9.05(h) or Section 9.05(i). Except as provided in this Section 9.24(b), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default exists or would exist and (iiiii) after giving effect to the Borrower complies with the requirements of Section 8.14, Section 8.17 and Section 9.15. Any such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary treated as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation a cash dividend in an amount equal to the lesser of the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of direct and indirect ownership interest in such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet or the requirements amount of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary Borrower’s cash investment previously made for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date limitation on Investments under Section 7.01 and/or 9.05(h) or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.05(i).

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 7.14 as of the Closing Date in writing to the Administrative Agent pursuant to this Sectiondate hereof or thereafter, assuming compliance with Section 9.06(b), any Person that becomes a Subsidiary of the Borrower Parent or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary (other than the Borrower), including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no Default or neither an Event of Default exists or nor a Borrowing Base Deficiency would exist, (ii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Parent’s direct and indirect ownership interest in such Subsidiary and such Investment would be permitted to be made at the time of such designation under Section 9.05(i), and (iii) no such Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as is not a “restricted subsidiary” for purposes of or guarantor with respect to any indenturePermitted Senior Unsecured Notes or Permitted Junior Lien Debt. Except as provided in this Section 9.06(b), credit agreement, or similar agreementno Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of the Borrower, the Parent and its other Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default exists or would exist and (iiiii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance complies with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted SubsidiarySection 8.14, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement Section 8.16 and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.14.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Sectionby the Borrower in accordance with Section 1.07(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries after the Effective Date (whether by formation, acquisition, merger or otherwise) shall be classified as a Restricted Subsidiary. Notwithstanding anything to the contrary contained in this Section 1.07, during the Specified Unrestricted Period, each of the Xxxxxxx Entities shall be classified as an Unrestricted Subsidiary without further action (and for the avoidance of doubt, without compliance with the requirements under Section 1.07(b)). (b) The Borrower may designate by prior written notice thereof to the Administrative Agent, any Restricted Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if Subsidiary; provided that (i) both immediately before before, and immediately after giving effect, to such designation, (A) no Default or Event of Default or Borrowing Base Deficiency exists or would exist, (ii) after giving effect to result from such designation and (B) the Borrower shall be in compliance, on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained set forth in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(cSection 9.01; (ii) as of the end of the most recent fiscal quarter; and (iii) no such Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as is not a “restricted subsidiary” for purposes of any indenture, credit agreement, indenture or similar agreement. other agreement governing Debt for borrowed money of the Borrower or a Restricted Subsidiary; (ciii) The Borrower may designate an Unrestricted Subsidiary such designation shall be deemed to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before and after such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary and such designation shall be permitted only to the extent such Investment is permitted under Section 9.05(h) or applicable Section 9.05(n) on the date of such designation (without regard to any future fluctuations in value); (iv) such designation shall be deemed to be a Disposition pursuant to which the provisions of Section 2.07(e) and Section 9.12 shall apply; (v) after giving effect to such designation, such Subsidiary is in compliance with the requirements of Section 8.18; and (vi) the Administrative Agent shall have received a certificate of a Responsible Officer, in form and substance reasonably satisfactory to the Administrative Agent, certifying as to the satisfaction of the conditions and matters set forth in clauses (i)-(v) above (and in the case of clause (i)(B) above, setting forth reasonably detailed calculations demonstrating compliance on a pro forma basis with the covenants set forth in Section 9.01). Except as provided in this Section 1.07, no Subsidiary may be designated (and no Restricted Subsidiary may be redesignated) as an Unrestricted Subsidiary. (c) The Borrower may designate by prior written notice thereof to the Administrative Agent any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that (i) both immediately before, and immediately after giving effect, to such designation, (A) no Event of Default or Borrowing Base Deficiency exists or would result from such designation, (B) the Borrower shall be in compliance, on a pro forma basis, with the covenants set forth in Section 9.01, (C) the representations and warranties of the Loan Party’s investment therein. The Parties contained in this Agreement and each of the other Loan Documents shall be true and correct in all material respects (except that any representation and warranty that is qualified by materiality shall be true and correct in all respects) on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects (except that any representation and warranty that is qualified by materiality shall be true and correct in all respects) as of such date), (iii) the designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute be deemed to be the incurrence at the time of designation of any Indebtedness Investment, Debt, or Liens of such Subsidiary existing at such time. , and the Borrower shall be in compliance with Article IX after giving effect to such designation, (fiv) Ifimmediately after giving effect to such designation, at any time, any Unrestricted the Borrower and such Subsidiary would fail to meet shall be in compliance with the requirements of Section 8.14 and Section 8.17 and (v) the definition Administrative Agent shall have received a certificate of Unrestricted Subsidiarya Responsible Officer, it will thereafter cease in form and substance reasonably satisfactory to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed the Administrative Agent, certifying as to be incurred by a Restricted Subsidiary the satisfaction of the Borrower as conditions and matters set forth in clauses (i)-(iv) above (and in the case of such date andclause (i)(B) above, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under setting forth reasonably detailed calculations demonstrating compliance on a pro forma basis with the covenants set forth in Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.01).

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 4.13 as of the Closing Effective Date in writing to the Administrative Agent pursuant to this Sectionor thereafter, assuming compliance with Section 6.16(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by prior written notice thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, (A) the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), and (B) no Default or Event of Default exists or would existresult therefrom (and the Borrower shall be in compliance, (ii) after giving effect to such designation on a pro forma basis, with the Borrower covenant set forth in Section 7.13); (ii) such Subsidiary (A) is not the owner or the operator, by contract or otherwise, of any Oil and its Subsidiaries would have been in compliance Gas Interests and (B) is not a guarantor or the primary obligor with all of respect to the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarterRevolving Debt or any other Material Indebtedness; and (iii) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreement. (c) The Borrower may designate an Unrestricted Subsidiary the Investment deemed to be a Restricted made in such Subsidiary if after giving effect pursuant to such designation, (i) immediately before and after such designation, no Default or Event the next sentence would be permitted to be made at the time of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiariesunder Section 7.06. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Restricted Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such an Unrestricted Subsidiary at the date of designation in an amount equal to the aggregate amount of the Borrower’s or any Restricted Subsidiary’s Investments previously made in or to such Subsidiary. Except as provided in this Section 6.16(b), no Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. (c) The Borrower may designate by prior written notice thereof to the Administrative Agent and the Lead Lender any Unrestricted Subsidiary to be a Restricted Subsidiary if (i) immediately prior, and after giving effect to such designation, the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), (ii) no Default exists or would result therefrom (and the Borrower shall be in compliance, on a pro forma basis, with the covenant set forth in Section 7.13) and (iii) the Borrower is in compliance with the requirements of Section 6.10. Any such designation shall (x) be treated as a cash dividend in an amount equal to the lesser of the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary or applicable Loan Partythe amount of the Borrower’s cash investment therein. The designation previously made for purposes of the limitation on Investments under Section 7.06(b) or under any Unrestricted Subsidiary other subsection of Section 7.06, as a Restricted Subsidiary shall the case may be, and (y) constitute the incurrence at the time of such designation of any Investment, Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated as an Unrestricted Subsidiary after the Closing Date in writing to the Administrative Agent pursuant to this Sectioncompliance with Section 6.26(b) below, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries a Credit Party shall be classified as a Restricted SubsidiarySubsidiary of the Borrower. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and immediately after giving effect, to such designation, no Default or Event of Default exists or would existany Borrowing Base Deficiency shall have occurred and be continuing, (ii) after giving effect to such designation on a pro forma basis, is deemed to be an investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all fair market value as of the covenants contained date of such designation of the Borrower’s direct and indirect ownership interest in such Subsidiary and such investment would be permitted to be made at the time of such designation under Section 6.3(m), (iii) such designation would be permitted to be made as an Asset Sale for purposes of Section 6.8 and the other terms of this Agreement, including, without limitation, Sections 7.11(a), 7.11(b)(iv) the Borrower is in pro forma compliance with Section 6.16 and Section 6.17, and 7.11(c(v) the Borrower shall have delivered a certificate of a Responsible Officer as of the end such date of the most recent fiscal quarter; and (iii) no Subsidiary may be designated designation or redesignation, as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” applicable, certifying that each requirement for purposes of any indenture, credit agreement, such designation or similar agreementredesignation has been satisfied. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of the Credit Parties contained in each of the Credit Documents are true and correct on and as of such designationdate as if made on and as of the date of such redesignation (or, no Default or Event if stated to have been made expressly as of Default exists or would exist an earlier date, were true and correct as of such date), (ii) after giving effect to no Default would exist, and (iii) the Borrower complies with any applicable requirements of Section 5.6, Section 5.7, and Section 6.7. Any such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary treated as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation a cash dividend in an amount equal to the lesser of the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of direct and indirect ownership interest in such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet or the requirements amount of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary Borrower’s cash investment previously made for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date limitation on investments under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant6.3(m).

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 7.11 as of the Closing Effective Date in writing to the Administrative Agent pursuant to this Sectionor thereafter, assuming compliance with Section 9.07(b), any Person that becomes a Subsidiary of the Borrower Parent or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower Parent may designate by written notification thereof to the Global Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i1) immediately before prior, and after giving effect, to such designation, no neither a Default or Event of Default exists or nor a Global Borrowing Base Deficiency would exist, exist and (ii2) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Parent’s direct and indirect ownership interest in such Subsidiary and such Investment would be permitted to be made at the time of such designation under Section 9.06(j), (iiip) no Subsidiary may be designated as or (q). The Parent hereby notifies the Global Administrative Agent and the Lenders that upon the contribution of the Equity Interests of MLP Opco to MLP, MLP Opco shall become an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower Parent may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of the Parent and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default exists or would exist and (iiiii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance Parent complies with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement Section 8.13 and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant8.15.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 7.14 as of the Closing Date in writing to the Administrative Agent pursuant to this Sectiondate hereof or thereafter, assuming compliance with Section 9.20(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries a Loan Party shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before neither such Subsidiary nor any of its Subsidiaries owns any Equity Interests or Debt of, or owns or holds any Lien on any Property of, a Loan Party or any other Subsidiary of a Loan Party that is not a Subsidiary of the Subsidiary to be so designated, (ii) prior, and after giving effect, to such designation, (A) no Default or Event of Default exists or would existshall have occurred and be continuing and (B) the total Credit Exposures shall not exceed the Borrowing Base, (iiiii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Borrower’s direct and (iii) indirect ownership interest in such Subsidiary and such Investment would be permitted to be made at the time of such designation under Section 9.05(h). Except as provided in this Section 9.20(b), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation except to the extent (A) any such representation and warranty is expressly stated to have been made as of an earlier date, in which case, on an as of the date of such redesignation, such representation and warranty shall continue to be true and correct in all material respects as of such earlier date and (B) to the extent that any such representation and warranty is expressly qualified by materiality or by reference to Material Adverse Effect, such representation and warranty (as so qualified) shall be true and correct in all respects on and as of the date of such redesignation, (ii) after giving effect to such designation, no Default or Event of Default exists or would exist shall have occurred and be continuing, (iiiii) after giving effect to any Debt of such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall not be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence secured by Liens at the time of such designation of any Indebtedness or except for Liens of permitted by Section 9.03, and (iv) such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet Loan Party complies with the requirements of the definition of Unrestricted SubsidiarySection 8.14, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement Section 8.16 and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.15.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 7.14 as of the Closing Date in writing to the Administrative Agent pursuant to this Sectiondate hereof or thereafter, assuming compliance with Section 9.20(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no neither a Default or Event of Default exists or nor a Borrowing Base Deficiency would exist, exist and (ii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Borrower’s direct and (iii) indirect ownership interest in such Subsidiary and such Investment would be permitted to be made at the time of such designation under Section 9.05(i). Except as provided in this Section 9.20(b), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after such designation, no Default or Event warranties of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Restricted Subsidiaries would have been contained in compliance with all each of the covenants contained Loan Documents are true and correct in this Agreement, including, without limitation, Sections 7.11(a) all material respects on and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date andas if made on and as of the date of such redesignation, if except that (A) to the extent any such Indebtedness and/or Liens representations and warranties are not permitted expressly limited to an earlier date, such representations and warranties shall continue to be incurred true and correct in all material respects as of such specified earlier date under Section 7.01 and/or Section 7.02and (B) to the extent that any such representation and warranty is qualified by materiality, hereof, such representation and warranty (as applicable, the Borrower will so qualified) shall continue to be true and correct in default of such covenant.all respects,

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Sectionby the Borrower in accordance with Section 1.07(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries after the Effective Date (whether by formation, acquisition, merger or otherwise) shall be classified as a Restricted Subsidiary. On the Effective Date, there are no Unrestricted Subsidiaries. (b) The Borrower may designate by prior written notice thereof to the Administrative Agent, any Restricted Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if Subsidiary; provided that (i) both immediately before before, and immediately after giving effect, to such designation, (A) no Default or Event of Default or Borrowing Base Deficiency exists or would exist, (ii) after giving effect to result from such designation and (B) the Borrower shall be in compliance, on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained set forth in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(cSection 9.01; (ii) as of the end of the most recent fiscal quarter; and (iii) no such Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as is not a “restricted subsidiary” for purposes of the Revolving Credit Agreement or any indenture, credit agreement, indenture or similar agreement. other agreement governing Debt for borrowed money of the Borrower or a Restricted Subsidiary; (ciii) The Borrower may designate an Unrestricted Subsidiary such designation shall be deemed to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before and after such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary and such designation shall be permitted only to the extent such Investment is permitted under Section 9.05 on the date of such designation (without regard to any future fluctuations in value); (iv) such designation shall be deemed to be a Disposition pursuant to which the provisions of Section 9.12 shall apply; (v) after giving effect to such designation, such Subsidiary is in compliance with the requirements of Section 8.18; and (vi) the Administrative Agent shall have received a certificate of a Responsible Officer, in form and substance reasonably satisfactory to the Administrative Agent, certifying as to the satisfaction of the conditions and matters set forth in clauses (i)-(v) above (and in the case of clause (i)(B) above, setting forth reasonably detailed calculations demonstrating compliance on a pro forma basis with the covenants set forth in Section 9.01). Except as provided in this Section 1.07, no Subsidiary may be designated (and no Restricted Subsidiary may be redesignated) as an Unrestricted Subsidiary. (c) The Borrower may designate by prior written notice thereof to the Administrative Agent any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that (i) both immediately before, and immediately after giving effect, to such designation, (A) no Event of Default or applicable Borrowing Base Deficiency exists or would result from such designation, (B) the Borrower shall be in compliance, on a pro forma basis, with the covenants set forth in Section 9.01, (C) the representations and warranties of the Loan Party’s investment therein. The Parties contained in this Agreement and each of the other Loan Documents shall be true and correct in all material respects (except that any representation and warranty that is qualified by materiality shall be true and correct in all respects) on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects (except that any representation and warranty that is qualified by materiality shall be true and correct in all respects) as of such date), (iii) the designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute be deemed to be the incurrence at the time of designation of any Indebtedness Investment, Debt, or Liens of such Subsidiary existing at such time. , and the Borrower shall be in compliance with Article IX after giving effect to such designation, (fiv) Ifimmediately after giving effect to such designation, at any time, any Unrestricted the Borrower and such Subsidiary would fail to meet shall be in compliance with the requirements of Section 8.14 and (v) the definition Administrative Agent shall have received a certificate of Unrestricted Subsidiarya Responsible Officer, it will thereafter cease in form and substance reasonably satisfactory to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed the Administrative Agent, certifying as to be incurred by a Restricted Subsidiary the satisfaction of the Borrower as conditions and matters set forth in clauses (i)-(iv) above (and in the case of such date andclause (i)(B) above, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under setting forth reasonably detailed calculations demonstrating compliance on a pro forma basis with the covenants set forth in Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.01).

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 3.12 as of the Closing Date date of this Agreement or thereafter in writing to the Global Administrative Agent pursuant to this SectionAgent, any Person that becomes a Subsidiary of the Borrower Parent or any of its Restricted Subsidiaries (including Borrower) shall be classified as a Restricted Subsidiary. (b) The Borrower Parent may designate any Subsidiary of Parent (other than Borrower) (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if (i) immediately before and after such designation, no Default or Event of Default exists or would exist, (ii) after giving effect to such designation, no Default would exist as a result of a breach of Section 5.13 and ii) such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower fair market value of Parent’s direct and its Subsidiaries indirect ownership interest in such Subsidiary and such Investment would have been in compliance with all be permitted to be made at the time of the covenants contained such designation under Section 7.4(h). Except as provided in this Agreement, including, without limitation, Sections 7.11(aSection 1.5(b), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower Parent may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (iiii) immediately before the representations and after such designationwarranties of Borrower, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower Parent and its Restricted Subsidiaries would have been contained in compliance with all each of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) Loan Documents are true and 7.11(b) correct on and as of such date as if made on and as of the end date of the most recent fiscal quarter. such redesignation (d) All Subsidiaries or, if stated to have been made expressly as of an Unrestricted Subsidiary earlier date, were true and correct as of such date), iv) no Default would exist, and v) Borrower and Parent comply with the requirements of Section 5.12 and Section 5.15. Any such designation shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary treated as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation a cash dividend in an amount equal to the fair market value of the BorrowerParent’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of direct and indirect ownership interest in such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and the limitation on Investments under Section 7.4(h). (d) If, during any Indebtedness and Liens period, a Subsidiary is redesignated as either “Restricted” or “Unrestricted,” then for purposes of the calculation of EBITDA for such period, such Subsidiary will shall be deemed to be incurred by a Restricted Subsidiary have been redesignated as of the Borrower as first day of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenantrelevant period.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless As of July 1, 2004 and, unless designated after the Closing Date in writing to the Administrative Agent pursuant by the Borrower and approved by the Administrative Agent and the Majority Lenders in accordance with clause (b) below or, with respect to this SectionBois d'Arc Energy and the other Bois d'Arc Entities only, as provided in Section 2.15, at all times thereafter, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Any Subsidiary of the Borrower (including a newly formed or newly acquired Subsidiary) may designate a Subsidiary be designated (or redesignated) as an Unrestricted Subsidiary if (i) immediately before the Administrative Agent shall have received (1) a written request from the Borrower specifying the applicable Subsidiary and after such other information as the Administrative Agent may reasonably request, (2) the written consent of the Administrative Agent and the Majority Banks approving such designation, and (3) a certificate of a Responsible Officer of the Borrower that no Default or Event of Default exists shall then exist or would exist, result from such designation (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(bdesignation), and 7.11(c(ii) such designation is deemed to be an Investment in an amount equal to the fair market value of Borrower's direct and indirect ownership interest in such Subsidiary and such Investment would be permitted under Section 7.2 to be made at the time of such designation. Except as of provided in this Section 1.6(b) or, with respect to Bois d'Arc Energy and the end of the most recent fiscal quarter; and (iii) other Bois d'Arc Entities only, as provided in Section 2.15, no Subsidiary may be designated (and no Restricted Subsidiary may be redesignated) as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default then exists or would exist and result from such redesignation (ii) after giving effect to such designation on a pro forma basisredesignation), and (iii) the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreementcomplies, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted or causes such Subsidiary to hold any Equity Interests incomply, or any Indebtedness of, any Restricted Subsidiarywith the requirements of Sections 6.16 and 6.18." (e) The designation Clause (i) of Section 2.3.1 of the Credit Agreement is hereby amended and restated in its entirety to provide as follows: (i) Subject to the terms and conditions set forth herein, (A) the Issuing Bank agrees, in reliance upon the agreements of the other Lenders set forth in this Section 2.3, (1) from time to time on any Subsidiary Business Day during the period from the Closing Date until the Letter of Credit Availability Expiration Date, to issue Letters of Credit for the account of the Borrower and in the name of the Borrower or any of its Restricted Subsidiaries, and to amend or renew Letters of Credit previously issued by it, in accordance with subsection 2.3.2 below, and (2) to honor drafts under the Letters of Credit; and (B) the Lenders severally agree to participate in Letters of Credit issued for the account of the Borrower; provided that the Issuing Bank shall not be obligated to make any L/C Credit Extension with respect to any Letter of Credit, and no Lender shall be obligated to participate in, any Letter of Credit if as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at of the date of designation such L/C Credit Extension, (w) with respect to any renewal, extension or amendment to any previously issued Letter of Credit, the Restricted Subsidiary in whose name such Letter of Credit was originally issued (or was most recently renewed, extended or amended, if applicable) has become, or been redesignated as, an amount equal Unrestricted Subsidiary, (x) the Outstanding Amount of all L/C Obligations and all Loans would exceed the lesser of (A) the Aggregate Commitments on such date and (B) the Borrowing Base then in effect, (y) the aggregate Outstanding Amount of the Loans of any Lender, plus such Lender's Percentage Share of the Outstanding Amount of all L/C Obligations would exceed the lesser of (A) such Lender's Commitment or (B) such Lender's Percentage Share of the Borrowing Base then in effect, or (z) the Outstanding Amount of the L/C Obligations would exceed the Letter of Credit Sublimit. Within the foregoing limits, and subject to the fair market value of terms and conditions hereof, the Borrower’s 's ability to obtain Letters of Credit shall be fully revolving, and accordingly the Borrower may, during the foregoing period, obtain Letters of Credit to replace Letters of Credit that have expired or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such timethat have been drawn upon and reimbursed." (f) If, at any time, any Unrestricted Subsidiary would fail to meet The Credit Agreement is hereby amended by inserting the requirements of following new Sections 2.15 and 2.16 immediately following the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under existing Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.2.14:

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Effective Date in writing to the Administrative Agent pursuant to this Section, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries after the Effective Date shall be classified as a Restricted Subsidiary. (b) The Borrower may designate any Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if Subsidiary, provided that (i) any such designation shall be deemed to be an Investment on the date of such designation in an Unrestricted Subsidiary in an amount equal to the sum of the (A) the fair market value of the outstanding Investments of the Borrower and the Restricted Subsidiaries in such Unrestricted Subsidiary and (B) the aggregate principal amount of any Indebtedness owed by such Unrestricted Subsidiary to the Borrower and its Restricted Subsidiaries immediately before prior to such designation, all calculated, on a consolidated basis in accordance with GAAP, (ii) the representations and warranties of the Loan Parties contained in each of the Loan Documents shall be true and correct on and as of the date of such designation as if made on and as of such date (or, if stated to have been made expressly as of an earlier date, were true and correct as of such earlier date), (iii) after giving effect to such designation, no Default or Event of Default exists or would exist, (iiiv) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all of the covenants contained set forth in this AgreementSection 6.10, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c(v) as of the end of the most recent fiscal quarter; and (iii) no such Subsidiary may be designated as an Unrestricted Subsidiary if it will shall be treated as a an “restricted subsidiaryUnrestricted Subsidiary” for purposes of any indentureindenture or agreement governing notes which is permitted under the terms of this Agreement and to which any Loan Party is or becomes a party, credit agreement(vi) the Investment represented by such designation shall be permitted under Section 6.04(a)(xvi) and (vii) the Borrower shall provide to the Administrative Agent an Officer’s Certificate in form satisfactory to the Administrative Agent to the effect that each of the foregoing conditions has been satisfied. Except as provided in this Section, or similar agreementno Restricted Subsidiary may be re-designated as an Unrestricted Subsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct in all material respects on and as of the date of such designation as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such earlier date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist and (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all of the covenants contained set forth in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarterSection 6.10. (d) All The Borrower will not, and will not permit any of the Restricted Subsidiaries to, guarantee any Indebtedness or other obligations of any Unrestricted Subsidiary, other than (i) to the extent permitted by Section 6.04, (ii) Letters of Credit issued hereunder for the account of an Unrestricted Subsidiary shall be also subject to the limitations contained in Section 2.17 and (iii) guarantees of performance obligations of any Unrestricted Subsidiaries. Subsidiary arising in the ordinary course of business and related to the operation of such Unrestricted Subsidiary’s business; provided that, for the avoidance of doubt, no such Guarantee under the forgoing clause (ii) shall, directly or indirectly, (A) benefit the holder of Indebtedness of such Unrestricted Subsidiary or (B) guarantee payment obligations of an Unrestricted Subsidiary, including accounts payable and capital expenditures, or payment obligations related to the purchase, construction or development of property. (e) The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted SubsidiarySubsidiary or any Material Project JV. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Item 6.8 of the Closing Date Disclosure Schedule as of the date of this Agreement or thereafter in writing to the Administrative Agent pursuant to this SectionAgent, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate any Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if (i) immediately before the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist, (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) in the case of a Subsidiary which is already classified as a Restricted Subsidiary, the Borrower has obtained the prior written consent of the Administrative Agent and the Required Lenders. Except as provided in this Section, no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), and (ii) after giving effect to such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarterexist. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 3.12 as of the Closing Date date of this Agreement or thereafter in writing to the Administrative Agent pursuant to this SectionAgent, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate any Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if (i) immediately before and after giving effect to such designation, no Default or Event would exist as a result of Default exists or would exist, a breach of Section 5.13 and (ii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower fair market value of Borrower’s direct and its Subsidiaries indirect ownership interest in such Subsidiary and such Investment would have been in compliance with all be permitted to be made at the time of the covenants contained such designation under Section 7.4(h). Except as provided in this Agreement, including, without limitation, Sections 7.11(aSection 1.5(b), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such redesignation (or, no Default or Event if stated to have been made expressly as of Default exists or would exist an earlier date, were true and correct as of such date), (ii) after giving effect to no Default would exist, and (iii) Borrower complies with the requirements of Section 5.12 and Section 5.15. Any such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary treated as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation a cash dividend in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of direct and indirect ownership interest in such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and the limitation on Investments under Section 7.4(h). (d) If, during any Indebtedness and Liens period, a Subsidiary is redesignated as either “Restricted” or “Unrestricted,” then for purposes of the calculation of EBITDA for such period, such Subsidiary will shall be deemed to be incurred by a Restricted Subsidiary have been redesignated as of the Borrower as first day of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenantrelevant period.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 4.15 as of the Closing Date in writing to the Administrative Agent pursuant to this Sectionor thereafter, assuming compliance with Section 6.11(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by prior written notice thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after such designationgiving effect, no Default or Event of Default exists or would exist, (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreement. (c) The Borrower may designate an Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before (A) the representations and after warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), and (B) no Default or Event of Default exists or would exist (and the Borrower shall be in compliance, on a Pro Forma Basis, with the covenants set forth in Section 7.1); and (ii) after giving effect the Investment deemed to be made in such Subsidiary pursuant to the next sentence would be permitted to be made at the time of such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiariesunder Section 7.7(e). The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Restricted Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such an Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment thereindirect and indirect ownership interest in such Subsidiary. Except as provided in this Section 6.11(b), no Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. (c) The designation of Borrower may designate by prior written notice thereof to the Administrative Agent any Unrestricted Subsidiary as to be a Restricted Subsidiary if immediately prior, and after giving effect to such designation, (i) (A) the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), (ii) no Default or Event of Default exists or would exist (and the Borrower shall be in compliance, on a Pro Forma Basis, with the covenants set forth in Section 7.1) and (ii) the Borrower is in compliance with the requirements of Section 6.9 and Section 7.18. Any such designation shall (x) be treated as a cash dividend in an amount equal to the lesser of the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary or the amount of the Borrower’s cash investment previously made for purposes of the limitation on Investments under Section 7.7(e) and (y) constitute the incurrence at the time of such designation of any Investment, Indebtedness or Liens of such Subsidiary existing at such time. (fd) IfThe Borrower will cause the management, at any timebusiness and affairs of each Group Member to be conducted in such a manner (including, any without limitation, by keeping separate books of account, furnishing separate financial statements of Unrestricted Subsidiaries to creditors and potential creditors thereof and by not permitting Properties of the Group Members to be commingled) so that each Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary that is a corporation will be deemed to be incurred by treated as a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenantcorporate entity separate and distinct from each Group Member.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this SectionAssuming compliance with Section 9.19(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by prior written notice thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, (A) the representations and warranties of each Loan Party contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), (B) no Default or Event of Default exists or would existexist (and the Borrower shall be in compliance, (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained set forth in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; Section 9.01 and (iiiC) no such Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as is not a guarantor or “restricted subsidiary” for purposes of with respect to any indenture, credit agreement, Debt permitted pursuant to Section 9.02(c) or similar agreement. (c) The Borrower may designate an Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before and after such designation, no Default or Event of Default exists or would exist Section 9.02(i); and (ii) after giving effect the Investment deemed to be made in such Subsidiary (and its subsidiaries) pursuant to the next sentence would be permitted to be made at the time of such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiariesunder Section 9.05(l). The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Restricted Subsidiary as an Unrestricted Subsidiary shall (a) constitute an Investment in such an Unrestricted Subsidiary at the date of designation (and its subsidiaries) in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment direct and indirect ownership interest in such Subsidiary (and its subsidiaries) and (b) be deemed a disposition of the Property of such Subsidiary (and its subsidiaries) (and Equity Interests therein) for purposes of Section 9.12. Except as provided in this Section 9.19(b), no Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. (c) The designation of Borrower may designate by prior written notice thereof to the Administrative Agent any Unrestricted Subsidiary as to be a Restricted Subsidiary if (i) immediately prior, and after giving effect to such designation, (A) the representations and warranties of each Loan Party contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), (B) no Default exists or would exist (and the Borrower shall be in compliance, on a pro forma basis, with the covenants set forth in Section 9.01 and (ii) the Borrower is in compliance with the requirements of Section 8.14 and Section 9.20. Any such designation shall (x) be treated as a cash dividend in an amount equal to the lesser of the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary or the amount of the Borrower’s cash investment previously made for purposes of the limitation on Investments under Section 9.05(l) and (y) constitute the incurrence at the time of such designation of any Investment, Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 7.14 as of the Closing Date in writing to the Administrative Agent pursuant to this Sectiondate hereof or thereafter, assuming compliance with Section 9.22(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries (other than any Subsidiary of an Unrestricted Subsidiary) shall be classified as a Restricted Subsidiary. Any Person that becomes a Subsidiary of any Unrestricted Subsidiary shall be automatically classified as an Unrestricted Subsidiary. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary other than MEMP GP, including a newly formed or newly acquired Subsidiary (other than any Subsidiary of an Unrestricted Subsidiary), as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no neither a Default or Event of Default exists or nor a Borrowing Base Deficiency would exist, exist and (ii) after giving effect to such designation on is deemed to be a pro forma basis, cash Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Borrower’s direct and (iii) indirect ownership interest in such Subsidiary and such Investment would be permitted to be made at the time of such designation under Section 9.05(h). Except as provided in this Section 9.22(b), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default exists or would exist and (iiiii) after giving effect to the Borrower complies with the requirements of Section 8.14, Section 8.17 and Section 9.15. Any such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary treated as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation a cash dividend in an amount equal to the lesser of the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of direct and indirect ownership interest in such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet or the requirements amount of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary Borrower’s cash investment previously made for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date limitation on Investments under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.05(h).

Designation and Conversion of Restricted and Unrestricted Subsidiaries. Borrower will not: (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Section, Designate any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified Subsidiary as a Restricted an Unrestricted Subsidiary. (b) The , except Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no Default or Event of Default exists or would exist, (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreement. (c) The Borrower may designate an Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before and after such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been is deemed to be an Investment in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value as of the date of such designation of Borrower’s or applicable Loan Party’s investment therein. The designation of any direct and indirect ownership interest in such Unrestricted Subsidiary as and such Investment would be a Restricted Subsidiary shall constitute the incurrence Permitted Investment made at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such timedesignation. (fb) If, at any time, Designate any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted be a Restricted Subsidiary, it will thereafter cease except if after giving effect to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will designation, which shall be deemed to be incurred by a Restricted Subsidiary cash dividend in an amount equal to the lesser of the fair market value of Borrower’s direct and indirect ownership interest in such Unrestricted Subsidiary or the amount of Borrower’s cash investment previously made for purposes of the limitation on Investments under Section 7.8, (i) the representations and warranties of Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such date andas if made on and as of the date of such redesignation (or, if such Indebtedness and/or Liens are not permitted stated to be incurred have been made expressly as of an earlier date, were true and correct as of such date under Section 7.01 and/or Section 7.02date), hereof(ii) no Default or Event of Default would exist, as applicableand (iii) Borrower and such newly-designated Restricted Subsidiary complies with the requirements of Sections 6.15 and 6.17. (c) Incur, assume, guarantee or otherwise be or become liable for any Indebtedness of any of the Unrestricted Subsidiaries. (d) Permit any Unrestricted Subsidiary to hold any Equity in, or any Indebtedness of, Borrower will be in default of such covenantor any Restricted Subsidiary.”

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule ‎7.11 as of the Closing Effective Date in writing to the Administrative Agent pursuant to this Sectionor thereafter, assuming compliance with Section 9.07(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by written notification thereof to the Global Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i1) immediately before prior, and after giving effect, to such designation, no neither a Default or Event of Default exists or nor a Global Borrowing Base Deficiency would exist, exist and (ii2) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Borrower’s direct and (iiiindirect ownership interest in such Subsidiary and such Investment would be permitted to be made at the time of such designation under ‎Section 9.06(j), ‎(p) no Subsidiary may be designated as or ‎(q). The Borrower hereby notifies the Global Administrative Agent and the Lenders that upon the contribution of the Equity Interests of MLP Opco to MLP, MLP Opco shall become an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default exists or would exist and (iiiii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance complies with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement Section 8.13 and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant‎Section 8.15.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Section, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate any Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist, (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all of the covenants contained set forth in this AgreementSections 7.14 and 7.15, including, without limitation, Sections 7.11(a), 7.11(b), such compliance to be determined on the basis of the financial information most recently delivered to the Administrative Agent and 7.11(cthe Lenders pursuant to Section 6.01(a) or (b) as though such Investment had been consummated as of the end first day of the most recent fiscal quarter; and period covered thereby, (iiiiv) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, indenture or similar agreement. (c) The Borrower may designate an Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before and after such designation, no Default or Event of Default exists or would exist agreement governing Unsecured Note Indebtedness and (iiv) after giving effect to such designation on in the case of a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary which is already classified as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted other than an Immaterial Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable), the Borrower will has obtained the prior written consent of the Administrative Agent and the Required Lenders. Except as provided in this Section, no Restricted Subsidiary may be in default of such covenantredesignated as an Unrestricted Subsidiary.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date as an Unrestricted Subsidiary in writing to the Administrative Agent pursuant to this Sectioncompliance with Section 9.18(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and immediately after giving effect, to such designation, no neither a Default or Event of Default exists or would existnor a Borrowing Base Deficiency shall have occurred and be continuing, (ii) after giving effect to such designation on a pro forma basis, is deemed to be (A) an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Borrower’s direct and indirect ownership interest in such Subsidiary and such Investment would be permitted to be made at the time of such designation under Section 9.7 and (B) a disposition of 100% of the assets of such Subsidiary and such disposition would be permitted to be made at the time of such designation under Section 9.5 and (iii) no such Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as is not a “restricted subsidiary” for purposes of party to any indenture, credit agreement, contract, arrangement or similar understanding with the Borrower or any other Credit Party unless the terms of such agreement., contract, arrangement or understanding are permitted or not prohibited (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary by written notification thereof to the Administrative Agent if after giving effect to such designation, (i) immediately before the representations and after warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects (or, if already qualified by materiality, Material Adverse Effect or a similar qualification, true and correct in all respects) as of such date), (ii) no Default or Event of Default exists or would exist shall have occurred and be continuing, (iiiii) after giving effect to such designation the Borrower shall be in compliance on a pro forma basis, basis with Section 10.1 and (iv) the Borrower and its Subsidiaries would have been in compliance complies with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement Section 5.4 and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant8.15.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing Any Person (other than any DevCo prior to the Administrative Agent pursuant to this Section, any Person date on which it is a Wholly-Owned Subsidiary) that becomes a Subsidiary of the Parent, the Borrower or any of its other Restricted Subsidiaries Subsidiary shall be classified as a Restricted Subsidiary unless such Person (i) is designated as an Unrestricted Subsidiary on Schedule 7.14, as of the date hereof, (ii) is hereafter designated as an Unrestricted Subsidiary in compliance with Section 9.18(b), or (iii) is a subsidiary of an Unrestricted Subsidiary. Each DevCo shall be an Unrestricted Subsidiary until such time that such DevCo is a Wholly-Owned Subsidiary, at which time it will become a Restricted Subsidiary for purposes of the Loan Documents. (b) The Parent and the Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary (for the avoidance of doubt, other than the Borrower), including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no Default or Event of Default exists or would exist, exist and (ii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Parent or the Borrower’s direct and (iii) indirect ownership interest in such Subsidiary and such Investment would be permitted to be made under Section 9.05. Except as provided in this Section 9.18(b), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Parent and the Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after such designation, no Default or Event warranties of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basisthe Parent, the Borrower and its the other Restricted Subsidiaries would have been contained in compliance with all each of the covenants contained Loan Documents are true and correct in this Agreement, including, without limitation, Sections 7.11(a) all material respects on and 7.11(b) as of such date as if made on and as of the end date of such redesignation except to the most recent fiscal quarter. extent (dA) All Subsidiaries any such representations and warranties are expressly limited to an earlier date, in which case, on and as of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation such redesignation, such representations and warranties shall continue to be true and correct as of such specified earlier date and (B) to the extent that any such representation and warranty is expressly qualified by materiality or by reference to Material Adverse Effect, such representation and warranty (as so qualified) shall be true and correct in all respects on and as of the date of such redesignation, (ii) no Event of Default would exist or result therefrom and (iii) the Parent and the Borrower comply with the requirements of Section 8.14, Section 8.16 and Section 9.15. Upon any such designation, an amount equal to the lesser of the fair market value of the Parent’s or the Borrower’s direct and indirect ownership interest in such Subsidiary or applicable Loan Partythe amount of the Parent’s or the Borrower’s cash investment thereinpreviously made in such Subsidiary shall be deemed no longer outstanding for purposes of the limitation on Investments under Section 9.05. The designation of any Unrestricted Subsidiary Notwithstanding the foregoing, a DevCo may not be designated as a Restricted Subsidiary shall constitute the incurrence at the until such time of designation of as it becomes a Wholly-Owned Subsidiary. Furthermore, immediately upon any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted DevCo becoming a Wholly-Owned Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement the Parent and any Indebtedness and Liens of such Subsidiary will the Borrower shall be deemed to be incurred by automatically designate such DevCo as a Restricted Subsidiary and shall be required to take each of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under actions required by this Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.18(c).

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Section, any Any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries Subsidiary shall be classified as a Restricted Subsidiary unless such Person (i) is designated as an Unrestricted Subsidiary on Schedule 7.14, as of the date hereof, (ii) is hereafter designated as an Unrestricted Subsidiary in compliance with Section 9.15(b), or (iii) is a subsidiary of an Unrestricted Subsidiary. Each OpCo shall be a Restricted Subsidiary at all times. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary (other than an OpCo), including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no Default or Event of Default exists or would exist, exist and (ii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Borrower’s direct and (iii) indirect ownership interest in such Subsidiary and such Investment would be permitted to be made under Section 9.05. Except as provided in this Section 9.15(b), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of the Borrower and the Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such designationdate as if made on and as of the date of such redesignation except to the extent (A) any such representations and warranties are expressly limited to an earlier date, in which case, on and as of the date of such redesignation, such representations and warranties shall continue to be true and correct as of such specified earlier date and (B) to the extent that any such representation and warranty is expressly qualified by materiality or by reference to Material Adverse Effect, such representation and warranty (as so qualified) shall be true and correct in all respects on and as of the date of such redesignation, (ii) no Default or Event of Default exists or would exist and (iiiii) after giving effect to such designation on a pro forma basis, the Borrower complies with the requirements of Section 8.14, Section 8.15 and its Subsidiaries would have been in compliance with all of the covenants contained in this AgreementSection 9.13. Upon any such designation, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the lesser of the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary or applicable Loan Partythe amount of the Borrower’s cash investment therein. The designation of any Unrestricted Subsidiary as a Restricted previously made in such Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary deemed no longer outstanding for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date limitation on Investments under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.05.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Section, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate any Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist, (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all of the covenants contained set forth in this Agreement, including, without limitation, Sections 7.11(a7.14(b) (prior to the Collateral Release Date) and 7.15(b), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iiiiv) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indentureindenture or agreement governing Unsecured Note Indebtedness and (v) in the case of a Subsidiary which is already classified as a Restricted Subsidiary (other than an Immaterial Subsidiary), credit agreementthe Borrower has obtained the prior written consent of the Administrative Agent and the Required Lenders. Notwithstanding the foregoing, the Borrower may designate as an “Unrestricted Subsidiary” a Person (whether formed before or similar agreementafter the Closing Date) that owns, directly or indirectly, Targa Downstream LLC’s 38.75% interest in Gulf Coast Fractionators. Except as provided in this Section, no Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist and (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all of the covenants contained set forth in this Agreement, including, without limitation, Sections 7.11(a7.14(b) (prior to the Collateral Release Date) and 7.11(b) as of the end of the most recent fiscal quarter7.15(b). (d) All The Borrower will not, and will not permit any of the Restricted Subsidiaries to, Guarantee any Indebtedness or other obligations of any Unrestricted Subsidiary, other than (i) Letters of Credit issued hereunder for the account of an Unrestricted Subsidiary shall be also subject to the limitations contained in Section 2.03(a) and (ii) Guarantees of obligations of any Unrestricted Subsidiary (other than Indebtedness) arising in the ordinary course of business and related to the operation of such Unrestricted Subsidiary’s business (A) to the extent existing on the Closing Date and set forth on Schedule 6.17(d) or (B) to the extent incurred after the Closing Date, subject to the aggregate contingent liabilities thereunder at any one time outstanding not exceeding $75,000,000 (when taken together with the aggregate face amount of Letters of Credit issued pursuant to Section 2.03(a) for the account of Unrestricted Subsidiaries. ). (e) The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of Subsidiary or any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Included Unrestricted Subsidiary, it will thereafter cease to be except that an Included Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be may hold Equity Interests in default of such covenantanother Included Unrestricted Subsidiary.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 7.15 as of the Closing Date in writing to the Administrative Agent pursuant to this Sectiondate hereof or thereafter, assuming compliance with Section 9.20(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries a Loan Party shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before neither such Subsidiary nor any of its Subsidiaries owns any Equity Interests or Debt of, or owns or holds any Lien on any Property of, a Loan Party or any other Subsidiary of a Loan Party that is not a Subsidiary of the Subsidiary to be so designated, (ii) prior, and after giving effect, to such designation, (A) no Default or Event of Default exists or would existshall have occurred and be continuing and (B) the total Credit Exposures shall not exceed the Borrowing Base, (iiiii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Borrower’s direct and (iii) indirect ownership interest in such Subsidiary and such Investment would be permitted to be made at the time of such designation under Section 9.05(h). Except as provided in this Section 9.20(b), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist shall have occurred and be continuing, (iiiii) after giving effect to any Debt of such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall not be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence secured by Liens at the time of such designation of any Indebtedness or except for Liens of permitted by Section 9.03, and (iv) such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet Loan Party complies with the requirements of the definition of Unrestricted SubsidiarySection 8.14, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement Section 8.16 and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.9.15. Resolute Energy Corporation Second Amended & Restated Credit Agreement

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Sectionby the Borrower in accordance with clause (b) below, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries after the date hereof (whether by formation, acquisition or merger) shall be classified as a Restricted Subsidiary. On the date hereof, all Subsidiaries of the Borrower are Restricted Subsidiaries. (b) The Beginning on the date on which the first financial statements have been delivered pursuant to Section 8.01(a), the Borrower may designate designate, by prior or concurrent written notice thereof to the Administrative Agent, any Restricted Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if Subsidiary, provided that (i) both immediately before before, and immediately after giving effect, to such designation, (A) no Default or Default, Event of Default or Borrowing Base Deficiency exists or would existresult from such designation, and (iiB) after giving effect the Pro Forma Net Leverage Ratio shall not exceed 3.253.50 to such designation 1.00 and the Borrower shall be in compliance, on a pro forma basis, with the Borrower financial covenant set forth in Section 9.01(b) (determined on a pro forma basis using Current Assets and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) Current Liabilities as of the end last day of the Borrower’s most recent recently ended fiscal quarterquarter for which financial statements have been delivered pursuant to Section 8.01(a) or Section 8.01(b)); and (iiiii) no such Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as is not a “restricted subsidiary” for purposes of any indenture, credit agreement, indenture or similar agreement. other agreement governing Debt of the Credit Parties or a Restricted Subsidiary; (ciii) The Borrower may designate an Unrestricted Subsidiary such designation shall be deemed to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before and after such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary on the date of such designation and such designation shall be permitted only to the extent such Investment is permitted under Section 9.05 on the date of such designation; (iv) such designation shall be deemed to be a Disposition pursuant to which the provisions of Section 2.07(f) shall apply; (v) after giving effect to such designation, the Borrower is in compliance with the requirements of Section 9.20; and (vi) the Administrative Agent shall have received a certificate of a Responsible Officer, in form and substance reasonably satisfactory to the Administrative Agent, certifying as to the satisfaction of the conditions and matters set forth in clauses (i) through (v) above (and in the case of clause (i)(B) above, setting forth reasonably detailed calculations demonstrating that the Pro Forma Net Leverage Ratio will not exceed 3.253.50 to 1.00 and the Borrower will be in compliance, on a pro forma basis, with the financial covenant set forth in Section 9.01(b) (determined on a pro forma basis using Current Assets and Current Liabilities as of the last day of the Borrower’s most recently ended fiscal quarter for which financial statements have been delivered pursuant to Section 8.01(a) or applicable Section 8.01(b))). Except as provided in this Section 1.06, no Subsidiary may be designated (and no Restricted Subsidiary may be redesignated) as an Unrestricted Subsidiary. (c) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements for an Unrestricted Subsidiary set forth in Section 9.20, it shall thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement (and, for the avoidance of doubt, any Investment, Debt and Liens of such Subsidiary existing at such time shall be deemed to be incurred by such Subsidiary as of such time and, if such Investments, Debt and Liens are not permitted to be incurred as of such time under Article IX, an Event of Default shall occur). (d) Beginning on the date on which the first financial statements have been delivered pursuant to Section 8.01(b), the Borrower may designate, by prior or concurrent written notice thereof to the Administrative Agent any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that (i) both immediately before, and immediately after giving effect, to such designation, (A) no Default, Event of Default or Borrowing Base Deficiency exists or would result from such designation, (B) the Pro Forma Net Leverage Ratio shall not exceed 3.253.50 to 1.00 and the Borrower shall be in compliance, on a pro forma basis, with the financial covenant set forth in Section 9.01(b) (determined on a pro forma basis using Current Assets and Current Liabilities as of the last day of the Borrower’s most recently ended fiscal quarter for which financial statements have been delivered pursuant to Section 8.01(a) or Section 8.01(b)) and (C) the representations and warranties of the Credit Parties and the Restricted Subsidiaries contained in this Agreement and each of the other Loan Party’s investment therein. The Documents shall be true and correct in all material respects (except that any representation and warranty that is qualified by materiality shall be true and correct in all respects) on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects (except that any representation and warranty that is qualified by materiality shall have been true and correct in all respects) on and as of such earlier date), (ii) the designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness Investment, Debt, or Liens of such Subsidiary existing at such time. , and the Borrower shall be in compliance with Article IX after giving effect to such designation, (fiii) Ifimmediately after giving effect to such designation, at any time, any Unrestricted the Borrower and such Subsidiary would fail to meet shall be in compliance with the requirements of Section 8.14 and (iv) the definition Administrative Agent shall have received a certificate of Unrestricted Subsidiarya Responsible Officer, it will thereafter cease in form and substance reasonably satisfactory to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed the Administrative Agent, certifying as to be incurred by a Restricted Subsidiary the satisfaction of the Borrower as conditions and matters set forth in clauses (i)-(iii) above (and in the case of such date andclause (i)(B) above, if such Indebtedness and/or Liens are setting forth reasonably detailed calculations demonstrating that the Pro Forma Net Leverage Ratio will not permitted exceed 3.253.50 to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, 1.00 and the Borrower will be in default compliance, on a pro forma basis, with the financial covenant set forth in Section 9.01(b) (determined on a pro forma basis using Current Assets and Current Liabilities as of such covenantthe last day of the Borrower’s most recently ended fiscal quarter for which financial statements have been delivered pursuant to Section 8.01(a) or Section 8.01(b))).

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated as an Unrestricted Subsidiary after the Closing Date date of this Agreement in writing to the Administrative Agent pursuant to this SectionAgent, any Person that becomes a Subsidiary of the Borrower or Pacific Energy Partners or any of its their Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower and Pacific Energy Partners may designate any of its Subsidiaries (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if (i) immediately before and if, after giving effect to such designation, no Default or Event of Default exists or would exist; provided, however, that neither Pacific Pipeline System LLC, Pacific Terminals LLC, Rocky Mountain Pipeline System LLC nor any other Subsidiary whose net earnings (ii) after giving effect to such designation on a or pro forma basis, net earnings in the Borrower and its Subsidiaries would have been in compliance with all case of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(ca newly formed Subsidiary) as of the end of the most recent fiscal quarter; and (iii) no Subsidiary Fiscal Quarter end prior to such designation exceeded 10% of Consolidated net earnings of Pacific Energy Partners may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes and no material assets (other than cash) of any indentureRestricted Subsidiary may be contributed to an Unrestricted Subsidiary except assets acquired by a Restricted Subsidiary after the date of this Agreement and contributed to an Unrestricted Subsidiary within ninety (90) days after the date such assets are acquired by the Restricted Subsidiary. Except as provided in this Section 6.18, credit agreement, or similar agreementno Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. (c) The Borrower and Pacific Energy Partners may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if if, after giving effect to such designation, (i) immediately before and after such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarterexist. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Section, any Any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries Subsidiary shall be classified as a Restricted SubsidiarySubsidiary unless such Person is hereafter designated as an Unrestricted Subsidiary in compliance with Section 7.19(b). (b) The Borrower may designate by written notification thereof (including, for the avoidance of doubt, by delivering a Subsidiary supplement to Section 5.13 of the Disclosure Schedule) to the Administrative Agent, any Restricted Subsidiary, including a newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no Default or Event of Default exists or would exist, (ii) such designation is deemed to be an Investment in such Unrestricted Subsidiary on the date of such designation and such Investment is a Permitted Investment under Section 7.7(i) and (iii) after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Subsidiaries would have been will be in compliance with all of the financial covenants contained set forth in Section 7.14. To the extent that any newly designated Unrestricted Subsidiary itself has any Subsidiaries when it is designated as an Unrestricted Subsidiary, such Subsidiaries must also be designated as Unrestricted Subsidiaries in compliance with this Section 7.19(b). Except as provided in this Agreement, including, without limitation, Sections 7.11(aSection 7.19(b), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Restricted Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of Borrower and the Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such designationdate as if made on and as of the date of such redesignation except to the extent (A) any such representations and warranties are expressly limited to an earlier date, in which case, on and as of the date of such redesignation, such representations and warranties shall continue to be true and correct as of such specified earlier date and (B) to the extent that any such representation and warranty is expressly qualified by materiality or by reference to a Material Adverse Effect, such representation and warranty (as so qualified) shall be true and correct in all respects on and as of the date of such redesignation, (ii) no Default or Event of Default exists or would exist and exist, (iiiii) after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Subsidiaries would have been will be in compliance with all the financial covenants set forth in Section 7.14 and (iv) Borrower complies with the requirements of the covenants contained in this AgreementSection 6.16, includingSection 6.17 and Section 7.18 with respect to such Subsidiary. Upon any such designation, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the lesser of the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary or applicable Loan Partythe amount of Borrower’s cash investment therein. The designation of any Unrestricted Subsidiary as a Restricted previously made in such Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary deemed no longer outstanding for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date limitation on Investments under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.7.7. 92 CREDIT AGREEMENT

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Section, any Person that becomes a Subsidiary of the either Borrower or any of its their Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower Partnership may designate a Subsidiary as an Unrestricted Subsidiary if (i) immediately before and after such designation, no Default or Event of Default exists or would existexist (including after the reclassification of Investments in, Indebtedness of, and Liens on the applicable Subsidiary), (ii) after giving effect to such designation on a pro forma basis, the Borrower Borrowers and its their Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of guarantor under any indenture, credit agreement, or similar agreementagreement to which either Borrower or any Restricted Subsidiaries are a party. (c) The Borrower Partnership may designate an Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before and after such designation, no Default or Event of Default exists or would exist (including after the reclassification of Investments in, Indebtedness of, and Liens on the applicable Subsidiary) and (ii) after giving effect to such designation on a pro forma basis, the Borrower Borrowers and its their Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b) and 7.11(b7.11(c) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower Borrowers will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, or be liable for any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the applicable Borrower’s or applicable Loan PartyRestricted Subsidiary’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall (i) constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. time and (fii) If, constitute a return on any Investment pursuant to the preceding sentence in an amount equal to the fair market value at any time, any Unrestricted Subsidiary would fail to meet the requirements date of such designation of the definition of Unrestricted Borrowers’ and the Restricted Subsidiaries’ Investment in such Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Sectionby the Borrower and approved by the Administrative Agent and the Majority Lenders in accordance with clause (b) below, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries (whether by formation, acquisition or merger) shall be classified as a Restricted Subsidiary; provided, however, that Bois d’Arc Energy and the other Bois d’Arc Entities shall be classified and designated as Unrestricted Subsidiaries unless redesignated as Restricted Subsidiaries in accordance with clause (c) below. (b) The Any Subsidiary of the Borrower (including a newly formed or newly acquired Subsidiary) may designate a Subsidiary be designated (or redesignated) as an Unrestricted Subsidiary if (i) immediately before the Administrative Agent shall have received (1) a written request from the Borrower specifying the applicable Subsidiary and after such other information as the Administrative Agent may reasonably request, (2) the written consent of the Administrative Agent and the Majority Lenders approving such designation, and (3) a certificate of a Responsible Officer of the Borrower certifying that no Default or Event of Default exists shall then exist or would exist, result from such designation (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(bdesignation), and 7.11(c(ii) such designation is deemed to be an Investment in an amount equal to the fair market value of Borrower’s direct and indirect ownership interest in such Subsidiary and such Investment would be permitted under Section 7.2 to be made at the time of such designation. Except as of the end of the most recent fiscal quarter; and (iii) provided in this Section 1.6(b), no Subsidiary may be designated (and no Restricted Subsidiary may be redesignated) as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default then exists or would exist and result from such redesignation (ii) after giving effect to such designation on a pro forma basisredesignation), and (iii) the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreementcomplies, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted or causes such Subsidiary to hold any Equity Interests incomply, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet with the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement Sections 6.16 and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant6.18.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 7.14 as of the Closing Date in writing to the Administrative Agent pursuant to this Sectiondate hereof or thereafter, assuming compliance with Section 9.20(b), any Person that becomes a Subsidiary of the Borrower Ultimate Parent or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower Ultimate Parent may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired 100 [AMENDED AND RESTATED CREDIT AGREEMENT] Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no neither a Default or Event of Default exists or nor a Borrowing Base Deficiency would exist, exist and (ii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Ultimate Parent’s direct and (iii) indirect ownership interest in such Subsidiary and such Investment would be permitted to be made at the time of such designation under Section 9.05(i). Except as provided in this Section 9.20(b), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower Ultimate Parent may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of the Group Members contained in each of the Loan Documents are true and correct in all material respects on and as of such designationdate as if made on and as of the date of such redesignation, except that (A) to the extent any such representations and warranties are expressly limited to an earlier date, such representations and warranties shall continue to be true and correct in all material respects as of such specified earlier date and (B) to the extent that any such representation and warranty is qualified by materiality, such representation and warranty (as so qualified) shall continue to be true and correct in all respects, (ii) no Default or Event of Default exists or would exist and (iiiii) after giving effect to Ultimate Parent and the Borrower otherwise complies with the requirements of Section 8.14, Section 8.16 and Section 9.15. Any such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary treated as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation a cash dividend in an amount equal to the lesser of the fair market value of Ultimate Parent’s direct and indirect ownership interest in such Subsidiary or the Borroweramount of Ultimate Parent’s or applicable Loan Party’s cash investment thereinpreviously made for purposes of the limitation on Investments under Section 9.05(i). The designation Any Subsidiary of any an Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease also be deemed to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenantSubsidiary.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 4.15 as of the Closing Date in writing to the Administrative Agent pursuant to this Sectionor thereafter, assuming compliance with Section 6.11(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by prior written notice thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after such designationgiving effect, no Default or Event of Default exists or would exist, (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreement. (c) The Borrower may designate an Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (iA) immediately before the representations and after warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), and (B) no Default or Event of Default exists or would exist (and the Borrower shall be in compliance, on a Pro Forma Basis, with the covenants set forth in Section 7.1); and (ii) after giving effect the Investment deemed to be made in such Subsidiary pursuant to the next sentence would be permitted to be made at the time of such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiariesunder Section 7.7(e). The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Restricted Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such an Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment thereindirect and indirect ownership interest in such Subsidiary. Except as provided in this Section 6.11(b), no Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. (c) The designation of Borrower may designate by prior written notice thereof to the Administrative Agent any Unrestricted Subsidiary as to be a Restricted Subsidiary if (i) immediately prior, and after giving effect to such designation, (A) the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), (ii) no Default or Event of Default exists or would exist (and the Borrower shall be in compliance, on a Pro Forma Basis, with the covenants set forth in Section 7.1) and (ii) the Borrower is in compliance with the requirements of Section 6.9 and Section 7.19. Any such designation shall (x) be treated as a cash dividend in an amount equal to the lesser of the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary or the amount of the Borrower’s cash investment previously made for purposes of the limitation on Investments under Section 7.7(e) and (y) constitute the incurrence at the time of such designation of any Investment, Indebtedness or Liens of such Subsidiary existing at such time. (fd) IfThe Borrower will cause the management, at any timebusiness and affairs of each Group Member to be conducted in such a manner (including, any without limitation, by keeping separate books of account, furnishing separate financial statements of Unrestricted Subsidiaries to creditors and potential creditors thereof and by not permitting Properties of the Group Members to be commingled) so that each Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary that is a corporation will be deemed to be incurred by treated as a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenantcorporate entity separate and distinct from each Group Member.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 7.14 as of the Closing Date in writing to the Administrative Agent pursuant to this Sectiondate hereof or thereafter, assuming compliance with Section 9.15(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no neither a Default or Event of Default exists or nor a Borrowing Base Deficiency would exist, exist and (ii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Borrower’s direct and (iiiindirect ownership interest in such Subsidiary and such Investment would be permitted to be made under Section 9.05. Except as provided in this Section 9.15(b) or the following Section 9.15(c), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) In addition to the provisions of the preceding subsection (b), upon any transfer to an Unrestricted Subsidiary, as permitted under Section 9.05(g), of the Equity Interests in either or both of Rice Olympus Midstream LLC and Rice Poseidon Midstream LLC, Rice Olympus Midstream LLC and/or Rice Poseidon Midstream LLC, as applicable, shall thereupon automatically be deemed and become an Unrestricted Subsidiary and, so long as no Event of Default then exists, be released from its obligations under the Loan Documents. (d) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such designationdate as if made on and as of the date of such redesignation except to the extent (A) any such representations and warranties are expressly limited to an earlier date, in which case, on and as of the date of such redesignation, such representations and warranties shall continue to be true and correct as of such specified earlier date and (B) to the extent that any such representation and warranty is expressly qualified by materiality or by reference to Material Adverse Effect, such representation and warranty (as so qualified) shall be true and correct in all respects on and as of the date of such redesignation, (ii) no Default or Event of Default exists or would exist and (iiiii) after giving effect to such designation on a pro forma basis, the Borrower complies with the requirements of Section 8.14, Section 8.15 and its Subsidiaries would have been in compliance with all of the covenants contained in this AgreementSection 9.13. Upon any such designation, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the lesser of the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary or applicable Loan Partythe amount of the Borrower’s cash investment therein. The designation of any Unrestricted Subsidiary as a Restricted previously made in such Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary deemed no longer outstanding for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date limitation on Investments under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.05.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date as an Unrestricted Subsidiary in writing to the Administrative Agent pursuant to this Sectioncompliance with Section 9.18(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and immediately after giving effect, to such designation, no neither a Default or Event of Default exists or would existnor a Borrowing Base Deficiency shall have occurred and be continuing, (ii) after giving effect to such designation on a pro forma basis, is deemed to be (A) an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Borrower’s direct and indirect ownership interest in such Subsidiary and such Investment would be permitted to be made at the time of such designation under Section 9.7 and (B) a disposition of 100% of the assets of such Subsidiary and such disposition would be permitted to be made at the time of such designation under Section 9.5 and (iii) such Subsidiary is not a party to any agreement, contract, arrangement or understanding with the Borrower or any other Credit Party unless the terms of such agreement, contract, arrangement or understanding are permitted or not prohibited by Section 9.8. Except as provided in this Section 9.18(b), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary by written notification thereof to the Administrative Agent if after giving effect to such designation, (i) immediately before the representations and after warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan DocumentsPapers are true and correct in all material respects on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects (or, if already qualified by materiality, Material Adverse Effect or a similar qualification, true and correct in all respects) as of such date), (ii) no Default or Event of Default exists or would exist shall have occurred and be continuing, (iiiii) after giving effect to such designation the Borrower shall be in compliance on a pro forma basis, basis with Section 10.1 and (iv) the Borrower and its Subsidiaries would have been in compliance complies with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement Section 5.4 and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant8.15.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Sectionby the Borrower and approved by the Administrative Agent and the Majority Lenders in accordance with clause (b) below, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries (whether by formation, acquisition or merger) shall be classified as a Restricted Subsidiary; provided, however, that CAM shall be classified and designated as an Unrestricted Subsidiary. (b) The Any Subsidiary of the Borrower (including a newly formed or newly acquired Subsidiary) may designate a Subsidiary be designated (or redesignated) as an Unrestricted Subsidiary if (i) immediately before the Administrative Agent shall have received (1) a written request from the Borrower specifying the applicable Subsidiary and after such other information as the Administrative Agent may reasonably request, (2) the written consent of the Administrative Agent and the Majority Lenders approving such designation, and (3) a certificate of a Responsible Officer of the Borrower certifying that no Default or Event of Default exists shall then exist or would exist, result from such designation (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(bdesignation), and 7.11(c(ii) such designation is deemed to be an Investment in an amount equal to the fair market value of Borrower’s direct and indirect ownership interest in such Subsidiary and such Investment would be permitted under Section 7.2 to be made at the time of such designation. Except as of the end of the most recent fiscal quarter; and (iii) provided in this Section 1.6(b), no Subsidiary may be designated (and no Restricted Subsidiary may be redesignated) as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default then exists or would exist and result from such redesignation (ii) after giving effect to such designation on a pro forma basisredesignation), and (iii) the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreementcomplies, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted or causes such Subsidiary to hold any Equity Interests incomply, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet with the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement Sections 6.16 and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant6.18.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date (but prior to the Amendment No. 5 Effective Date), in writing to the Administrative Agent pursuant to this Section, any Person that becomes a Subsidiary of the US Borrower or any of its the Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The US Borrower may designate a Subsidiary as an Unrestricted Subsidiary if (i) immediately before and after such designation, no Default or Event of Default exists or would exist, (ii) after giving effect to such designation on a pro forma basis, the US Borrower and its the Restricted Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Subsidiary may be designated as an Unrestricted Subsidiary if (A) it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, Indebtedness of the US Borrower or similar agreementany Restricted Subsidiary or (B) owns any Material Asset. (c) The US Borrower may designate an Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before and after such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the US Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) ), 7.11(b), and 7.11(b7.11(c) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The US Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) IfNotwithstanding anything herein to the contrary, at in no event shall (i) any timeLoan Party contribute, or otherwise invest, any Material Asset in, or Dispose of any Material Asset to, any Subsidiary that is not a Loan Party nor (ii) any Restricted Subsidiary contribute, or otherwise invest, any Material Asset in or Dispose of any Material Asset to, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 6.8 as of the Closing Date date of this Agreement or thereafter in writing to the Administrative Agent pursuant to this SectionAgent, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate any Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if (i) immediately before the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), and (ii) after giving effect to such designation, no Default or Event of Default exists or would exist; provided, (ii) after giving effect to such designation on a pro forma basishowever, that the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained may not designate either EDC or SOC as Unrestricted Subsidiaries. Except as provided in this AgreementSection, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), and (ii) after giving effect to such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarterexist. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 6.8 as of the Closing Date date of this Agreement or thereafter in writing to the Administrative Agent pursuant to this SectionAgent, any Person that becomes a Subsidiary of the Borrower Borrower, the Guarantor or any of its their Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate any Subsidiary (including a newly formed or newly acquired Subsidiary of the Guarantor) as an Unrestricted Subsidiary if (i) immediately before the representations and warranties of the Guarantor and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), and (ii) after giving effect to such designation, no Default or Event of Default exists or would exist; provided, (ii) after giving effect to such designation on a pro forma basishowever, that the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained Guarantor may not designate EDC as an Unrestricted Subsidiary. Except as provided in this AgreementSection, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower Guarantor may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Guarantor and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), and (ii) after giving effect to such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarterexist. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 3.14 as of the Closing Effective Date in writing to the Administrative Agent pursuant to this Sectionor thereafter, assuming compliance with Section 6.17(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. The Borrower will not, and will not permit any Restricted Subsidiary to, create or acquire any additional Subsidiary unless the Borrower gives written notice to the Administrative Agent of such creation or acquisition and complies with Section 5.13. (b) The Borrower may designate by prior written notice thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, (A) the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects (without duplication of any materiality qualifier contained therein) on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, are true and correct in all material respects (without duplication of any materiality qualifier contained therein) as of such earlier date), and (B) no Default or Event of Default Borrowing Base Deficiency exists or would existresult therefrom (and E/H MLP shall be in compliance, (ii) after giving effect to such designation on a pro forma basis, with the Borrower covenants set forth in Section 6.18); (ii) such Subsidiary (A) is not a Material Domestic Subsidiary, (B) is not the owner or the operator, by contract or otherwise, of any Oil and its Subsidiaries would have been Gas Properties included in compliance with all the Borrowing Base, (C) does not provide gathering, transporting, processing, marketing or other midstream services in respect of the covenants contained Oil and Gas Properties included in this Agreementthe Borrowing Base and (D) is not a guarantor or the primary obligor with respect to any indebtedness, including, without limitation, Sections 7.11(aliabilities or other obligations under any Senior Notes (or any Permitted Refinancing thereof), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no the investment deemed to be made in such Subsidiary may pursuant to the next sentence would be designated permitted to be made at the time of such designation under Section 6.04. The designation of any Restricted Subsidiary as an Unrestricted Subsidiary if it will shall constitute an investment in an Unrestricted Subsidiary in an amount equal to the aggregate amount of the Loan Parties’ investments previously made in or to such Subsidiary. Except as provided in this Section 6.17(b), no Restricted Subsidiary may be treated redesignated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementan Unrestricted Subsidiary. (c) The Borrower may designate an by prior written notice thereof to the Administrative Agent any Unrestricted Subsidiary to be a Restricted Subsidiary if (i) immediately prior, and after giving effect to such designation, the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects (iwithout duplication of any materiality qualifier contained therein) immediately before on and after as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, are true and correct in all material respects (without duplication of any materiality qualifier contained therein) as of such earlier date), (ii) no Default or Event of Default exists or would exist result therefrom (and (ii) after giving effect to such designation E/H MLP shall be in compliance, on a pro forma basis, with the covenants set forth in Section 6.18) and (iii) the Borrower complies with the requirements of Section 5.13 and its Subsidiaries would have been Section 5.15. Any such designation shall be treated as a cash dividend in compliance with all an amount equal to the lesser of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as fair market value of the end Borrower’s direct and indirect ownership interest in such Subsidiary or the amount of the most recent fiscal quarterBorrower’s cash investment previously made for purposes of limitations on investments under Section 6.04. (d) All No Loan Party will, nor will any Loan Party permit any of its Restricted Subsidiaries to, (i) incur, assume, guarantee or be or become liable for any Indebtedness of an Unrestricted Subsidiary shall be also any of the Unrestricted Subsidiaries. The Borrower will not , (ii) grant any Lien on any of its Property to secure any Indebtedness of, or provide any other form of credit support to, any of the Unrestricted Subsidiaries, or (iii) permit any Unrestricted Subsidiary to hold any Equity Interests Interest in, or any Indebtedness of, the Borrower or any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Section, any Any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries Subsidiary shall be classified as a Restricted SubsidiarySubsidiary unless such Person is hereafter designated as an Unrestricted Subsidiary in compliance with Section 5.15(b). (b) The Borrower may designate by written notification thereof (including, for the avoidance of doubt, by delivering a supplement to Section 3.13 of the Disclosure Schedule) to the Administrative Agent, any Subsidiary acquired or formed after the Closing Date, as an Unrestricted Subsidiary if (i) immediately before before, and after giving effect, to such designation, no Default or Event of Default exists or would exist, (ii) such designation is deemed to be an Investment in such Unrestricted Subsidiary on the date of such designation and such Investment is a Permitted Investment, (iii) after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Subsidiaries would have been will be in compliance with all the financial covenants set forth in Article VI, (iv) such Unrestricted Subsidiary has no Indebtedness other than Indebtedness that is non-recourse to any Restricted Person, (v) such Unrestricted Subsidiary has not guaranteed or otherwise directly or indirectly provided credit support for any Indebtedness of any Restricted Person, (vi) such Unrestricted Subsidiary is not party to any agreement, contract, arrangement or understanding with any Restricted Person the covenants contained terms of which agreement, contract, arrangement or understanding are materially less favorable to such Restricted Person than those that might be obtained at the time from Persons who are not Affiliates, (vii) such Unrestricted Subsidiary may not have any Indebtedness that has been guaranteed or is otherwise subject to any direct or indirect credit support from a Restricted Person, and (viii) such Unrestricted Subsidiary may not have any Indebtedness the default on which in any respect would permit any holder of any other Indebtedness of a Restricted Person to declare a default on such other Indebtedness or cause payment thereof to be accelerated or payable prior to its stated maturity. To the extent that any newly designated Unrestricted Subsidiary itself has any Subsidiaries when it is designated as an Unrestricted Subsidiary, such Subsidiaries must also be designated as Unrestricted Subsidiaries in compliance with this Section 5.15(b). Except as provided in this Agreement, including, without limitation, Sections 7.11(aSection 5.15(b), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Restricted Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before and after such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail ceases to meet comply with the requirements of the definition of Unrestricted Subsidiaryset forth above in paragraph (b), it will thereafter cease shall immediately thereupon be deemed to be an Unrestricted Subsidiary a Restricted Person for all purposes of this Agreement and the other Loan Documents, including that any Indebtedness and Liens of such Subsidiary will be deemed to be have been incurred by a Restricted Subsidiary of the Borrower as of such date and, and must be permitted by Section 5.1 and any Liens on assets of such Restricted Person must be Permitted Liens. The Borrower may at any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that such designation will be deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of the Borrower in an amount equal to the outstanding Indebtedness of such Unrestricted Subsidiary on such date of designation and such designation will only be permitted if (i) such Indebtedness and/or Liens are not is Indebtedness permitted to be incurred as by Section 5.1 and (ii) no Default or Event of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will Default would be in default existence upon such designation. On the date of any such covenantdesignation of an Unrestricted Subsidiary as a Restricted Subsidiary, such Restricted Subsidiary shall comply with Section 4.14 and Section 4.15. On any such redesignation, an amount equal to the lesser of the fair market value of Borrower’s direct and indirect ownership interest in such Subsidiary or the amount of Borrower’s cash investment previously made in such Subsidiary shall be deemed no longer outstanding for purposes of the limitation on Investments.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 6.8 as of the Closing Date date of this Agreement or thereafter in writing to the Administrative Agent pursuant to this SectionSection 7.1.7, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate any Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if (i) immediately before the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist, (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) in the case of a Subsidiary which is already classified as a Restricted Subsidiary, the Borrower has obtained the prior written consent of the Administrative Agent and the Required Lenders; provided however that the Borrower may not designate the Target or the Noble Merger Subsidiary as an Unrestricted Subsidiary. Except as provided in this Section, no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), and (ii) after giving effect to such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarterexist. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 7.15 as of the Closing Date in writing to the Administrative Agent pursuant to this Sectiondate hereof or thereafter, assuming compliance with Section 9.20(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries a Loan Party shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before neither such Subsidiary nor any of its Subsidiaries owns any Equity Interests or Debt of, or owns or holds any Lien on any Property of, a Loan Party or any other Subsidiary of a Loan Party that is not a Subsidiary of the Subsidiary to be so designated, (ii) prior, and after giving effect, to such designation, no Default or Event of Default exists or would existshall have occurred and be continuing, (iiiii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Borrower’s direct and (iii) indirect ownership interest in such Subsidiary and such Investment would be permitted to be made at the time of such designation under Section 9.05(h). Except as provided in this Section 9.20(b), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before and after giving effect to such designation, no Default or Event of Default exists or would exist shall have occurred and be continuing and (ii) after giving effect to any Debt of such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall not be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence secured by Liens at the time of such designation of any Indebtedness or except for Liens of permitted by Section 9.03, and (iv) such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet Loan Party complies with the requirements of the definition of Unrestricted SubsidiarySection 8.14, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement Section 8.16 and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.15.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Sectionby the Borrower and approved by the Administrative Agent and the Majority Lenders in accordance with clause (b) below, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries (whether by formation, acquisition or merger) shall be classified as a Restricted Subsidiary; provided, however, that CAM shall be classified and designated as an Unrestricted Subsidiary and shall at all times remain an Unrestricted Subsidiary so long as it is a Subsidiary and meets the requirements set forth in Section 6.18. (b) The Any Subsidiary of the Borrower (including a newly formed or newly acquired Subsidiary), excluding any Guarantor, may designate a Subsidiary be designated (or redesignated) as an Unrestricted Subsidiary if (i) immediately before the Administrative Agent shall have received (1) a written request from the Borrower specifying the applicable Subsidiary and after such other information as the Administrative Agent may reasonably request, (2) the written consent of the Administrative Agent and the Majority Lenders approving such designation, and (3) a certificate of a Responsible Officer of the Borrower certifying that no Default or Event of Default exists shall then exist or would exist, result from such designation (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(bdesignation), and 7.11(c(ii) such designation is deemed to be an Investment in an amount equal to the fair market value of Borrower’s direct and indirect ownership interest in such Subsidiary and such Investment would be permitted under Section 7.2 to be made at the time of such designation. Except as of the end of the most recent fiscal quarter; and (iii) provided in this Section 1.6(b), no Subsidiary may be designated (and no Restricted Subsidiary may be redesignated) as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The If, at any time, any Unrestricted Subsidiary would fail to meet the requirements for an Unrestricted Subsidiary set forth in Section 6.18, it shall thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness of such Subsidiary shall be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness is not permitted to be incurred as of such date under Section 7.3, the Borrower shall be in default of such covenant. (d) Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such redesignation (or, no Default or Event if stated to have been made expressly as of Default exists or would exist an earlier date, were true and correct as of such date), (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time, and the Borrower is in compliance with Sections 7.1 and 7.3 after giving effect to such designation, (iii) no Default or Event of Default then exists or would result from such redesignation (after giving effect to such redesignation), and (iv) the Borrower complies, or causes such Subsidiary to comply, with the requirements of Sections 6.16 and 6.18. Any such designation shall be evidenced by a certificate of a Responsible Officer of the Borrower delivered to the Administrative Agent prior to such designation certifying that the conditions of this Section 1.6(c) are satisfied as of the date of such designation (and, as a condition precedent to the effectiveness of any such designation, the Borrower shall deliver to the Administrative Agent a certificate setting forth in reasonable detail the calculations demonstrating compliance on a pro forma basis with the covenants set forth in Section 7.13). (fe) If, at any time, any Unrestricted No Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to may be designated as an Unrestricted Subsidiary hereunder unless it is also designated as an “Unrestricted Subsidiary” for purposes of this Agreement any Indenture Debt Documents and any Indebtedness and Liens of such (ii) no Subsidiary will designated as an Unrestricted Subsidiary may be deemed to be incurred by designated as a Restricted Subsidiary hereunder unless it is also designated as a “Restricted Subsidiary” for purposes of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenantany Indenture Debt Documents.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated as an Unrestricted Subsidiary after the Closing Date date of this Agreement in writing to the Administrative Agent pursuant to this SectionAgent, any Person that becomes a Subsidiary of the Borrower or Pacific Energy Partners or any of its their Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower and Pacific Energy Partners may designate any of its Subsidiaries (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if (i) immediately before and if, after giving effect to such designation, no Default or Event of Default exists or would exist; PROVIDED, HOWEVER, that neither Pacific Pipeline System LLC, Pacific Terminals LLC, Rocky Mountain Pipeline System LLC nor any other Subsidiary whose net earnings (ii) after giving effect to such designation on a or pro forma basis, net earnings in the Borrower and its Subsidiaries would have been in compliance with all case of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(ca newly formed Subsidiary) as of the end of the most recent fiscal quarter; and (iii) no Subsidiary Fiscal Quarter end prior to such designation exceeded 10% of Consolidated net earnings of Pacific Energy Partners may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes and no material assets (other than cash) of any indentureRestricted Subsidiary may be contributed to an Unrestricted Subsidiary except assets acquired by a Restricted Subsidiary after the date of this Agreement and contributed to an Unrestricted Subsidiary within ninety (90) days after the date such assets are acquired by the Restricted Subsidiary. Except as provided in this Section 6.18, credit agreement, or similar agreementno Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. (c) The Borrower and Pacific Energy Partners may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if if, after giving effect to such designation, (i) immediately before and after such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarterexist. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 4.13 as of the Closing Effective Date in writing to the Administrative Agent pursuant to this Sectionor thereafter, assuming compliance with Section 6.15(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by prior written notice thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, (A) the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), and (B) no Default or Event of Default exists or would existresult therefrom (and the Borrower shall be in compliance, (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained set forth in this AgreementSection 7.13); (ii) such Subsidiary (A) is not the owner or the operator, includingby contract or otherwise, without limitationof any Oil and Gas Interests and (B) is not a guarantor or the primary obligor with respect to any indebtedness, Sections 7.11(a)liabilities or other obligations under any Senior Notes, 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarterSecond Lien Debt or other Material Indebtedness; and (iii) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreement. (c) The Borrower may designate an Unrestricted Subsidiary the Investment deemed to be a Restricted made in such Subsidiary if after giving effect pursuant to such designation, (i) immediately before and after such designation, no Default or Event the next sentence would be permitted to be made at the time of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiariesunder Section 7.06. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Restricted Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such an Unrestricted Subsidiary at the date of designation in an amount equal to the aggregate amount of the Borrower’s or any Restricted Subsidiary’s Investments previously made in or to such Subsidiary. Except as provided in this Section 6.15(b), no Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. (c) The Borrower may designate by prior written notice thereof to the Administrative Agent any Unrestricted Subsidiary to be a Restricted Subsidiary if (i) immediately prior, and after giving effect to such designation, the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), (ii) no Default exists or would result therefrom (and the Borrower shall be in compliance, on a pro forma basis, with the covenants set forth in Section 7.13) and (iii) the Borrower is in compliance with the requirements of Section 6.09. Any such designation shall (x) be treated as a cash dividend in an amount equal to the lesser of the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary or applicable Loan Partythe amount of the Borrower’s cash investment therein. The designation previously made for purposes of the limitation on Investments under Section 7.06(b) or under any Unrestricted Subsidiary other subsection of Section 7.06, as a Restricted Subsidiary shall the case may be, and (y) constitute the incurrence at the time of such designation of any Investment, Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 7.14 as of the Closing Date in writing to the Administrative Agent pursuant to this Sectiondate hereof or thereafter, assuming compliance with Section 9.06(b), any Person that becomes a Domestic Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. Any Foreign Subsidiary of the Borrower or any Restricted Subsidiary shall be an Unrestricted Subsidiary. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no neither a Default or Event of Default exists or nor a Borrowing Base Deficiency would exist, exist and (ii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Borrower’s direct and (iiiindirect ownership interest in such Subsidiary and such Investment would be permitted to be made at the time of such designation under Section 9.05(l) or Section 9.05(n). Except as provided in this Section 9.06(b), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary (other than a Foreign Subsidiary) to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), (ii) no Default or Event of Default exists or would exist and (iiiii) after giving effect to the Borrower complies with the requirements of Section 8.14, Section 8.17 and Section 9.13. Any such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary treated as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation a cash dividend in an amount equal to the lesser of the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of direct and indirect ownership interest in such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet or the requirements amount of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary Borrower’s cash investment previously made for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date limitation on Investments under Section 7.01 and/or 9.05(l) or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.05(n).

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 6.8 as of the Closing Date date of this Agreement or thereafter in writing to the Administrative Agent pursuant to this SectionSection 7.1.7, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate any Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if (i) immediately before the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist, (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) in the case of a Subsidiary which is already classified as a Restricted Subsidiary, the Borrower has obtained the prior written consent of the Administrative Agent and the Required Lenders. Except as provided in this Section, no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), and (ii) after giving effect to such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarterexist. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this SectionAssuming compliance with Section 9.21(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by prior written notice thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after such designationgiving effect, no Default or Event of Default exists or would exist, (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreement. (c) The Borrower may designate an Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (iA) immediately before the representations and after warranties of each Loan Party contained in each of the Loan Documents are true and correct in all material respects on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), and (B) no Default or Event of Default exists or would exist (and (ii) after giving effect to such designation the Borrower shall be in compliance, on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained set forth in this Agreement, including, without limitation, Sections 7.11(aSection 9.01); and (ii) and 7.11(b) as the Investment deemed to be made in such Subsidiary pursuant to the next sentence would be permitted to be made at the time of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiariessuch designation under Section 9.05(l). The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Restricted Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such an Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment thereindirect and indirect ownership interest in such Subsidiary. Except as provided in this Section 9.21(b), no Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. (c) The designation of Borrower may designate by prior written notice thereof to the Administrative Agent any Unrestricted Subsidiary as to be a Restricted Subsidiary if (i) immediately prior, and after giving effect to such designation, (A) the representations and warranties of each Loan Party contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), (B) no Default or Event of Default exists or would exist (and the Borrower shall be in compliance, on a pro forma basis, with the covenants set forth in Section 9.01) and (ii) the Borrower is in compliance with the requirements of Section 8.14 and Section 9.22. Any such designation shall (x) be treated as a cash dividend in an amount equal to the lesser of the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary or the amount of the Borrower’s cash investment previously made for purposes of the limitation on Investments under Section 9.05(l) and (y) constitute the incurrence at the time of such designation of any Investment, Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Sectionby the Borrower, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries (whether by formation, acquisition or merger) shall be classified as a Restricted Subsidiary. Initially, Xxxxxxxx Escrow Corporation shall be classified and designated as an Unrestricted Subsidiary. (b) The Any Subsidiary of the Borrower (including a newly formed or newly acquired Subsidiary) may designate a Subsidiary be designated (or redesignated) as an Unrestricted Subsidiary if (i) immediately before the Administrative Agent shall have received (1) a written designation from the Borrower specifying the applicable Subsidiary and after such designationother information as the Administrative Agent may reasonably request, and (2) a certificate of a Responsible Officer of the Borrower certifying that the condition set forth in Section 1.7(b)(ii) is satisfied as of the date of such designation and that no Default or Event of Default exists Borrowing Base deficiency shall then exist or would exist, result from such designation (ii) after giving effect to such designation designation) (and, as a condition precedent to the effectiveness of any such designation, the Borrower shall deliver to the Administrative Agent a certificate setting forth in reasonable detail the calculations demonstrating compliance on a pro forma basis, with the covenants set forth in Section 6.1 (including Pro Forma Compliance with the financial ratio covenant set forth in Section 6.1(a)), (ii) the representations and warranties of Borrower and its Restricted Subsidiaries would contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (iii) such designation is deemed to be an Investment in an amount equal to the fair market value of Borrower’s direct and indirect ownership interest in such Subsidiary and such Investment would be permitted under Section 6.6(k) to be made at the time of such designation, (iv) such Subsidiary is in compliance with all the requirements of Section 5.16, and (v) such Subsidiary (A) is not a Material Domestic Subsidiary, (B) is not the owner or the operator, by contract or otherwise, of any Oil and Gas Properties included in the Borrowing Base, (C) does not provide gathering, transporting, processing, marketing or other midstream services in respect of the covenants contained Oil and Gas Properties included in the Borrowing Base and (D) is not a guarantor or the primary obligor with respect to any Indebtedness, liabilities or other obligations under any Permitted Debt or the Senior Notes (or any Permitted Refinancing Debt thereof). Except as provided in this AgreementSection 1.7, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Subsidiary may be designated (and no Restricted Subsidiary may be redesignated) as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The If, at any time, any Unrestricted Subsidiary would fail to meet the requirements for an Unrestricted Subsidiary set forth in Section 5.16, it shall thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness of such Subsidiary shall be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness is not permitted to be incurred as of such date under Section 6.2, the Borrower shall be in default of such covenant. (d) Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default then exists or would exist and result from such redesignation (ii) after giving effect to such designation on a pro forma basisredesignation), (iii) the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time, and the Borrower is in compliance with Sections 6.2 and 6.3 after giving effect to such designation, and (iv) the Borrower complies, or causes such Subsidiary to comply, with the requirements of Section 5.9. Any such designation shall be evidenced by a certificate of a Responsible Officer of the Borrower delivered to the Administrative Agent prior to such designation certifying that the conditions of this Section 1.7(d) are satisfied as of the date of such designation (and, as a condition precedent to the effectiveness of any such designation, the Borrower shall deliver to the Administrative Agent a certificate setting forth in reasonable detail the calculations demonstrating compliance on a pro forma basis, with the covenants set forth in Section 6.1 (including Pro Forma Compliance with the financial ratio covenant set forth in Section 6.1(a)). (fe) If, at any time, any Unrestricted No Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to may be designated as an Unrestricted Subsidiary hereunder unless it is also designated as an “Unrestricted Subsidiary” for purposes of this Agreement the Senior Notes or any Permitted Debt Documents and any Indebtedness and Liens of such (ii) no Subsidiary will designated as an Unrestricted Subsidiary may be deemed to be incurred by designated as a Restricted Subsidiary hereunder unless it is also designated as a “Restricted Subsidiary” for purposes of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenantany Permitted Debt Documents.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 7.13 as of the Closing Initial Funding Date in writing to the Administrative Agent pursuant to this Sectionor thereafter, assuming compliance with Section 9.14(b) below, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and immediately after giving effect, to such designationdesignation (including the effect of any repayments of Revolving Credit Exposure occurring contemporaneously therewith), no Default or Event of Default exists or would exist, nor any Borrowing Base Deficiency shall have occurred and be continuing and (ii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Borrower’s direct and (iii) indirect ownership interest in such Subsidiary and such Investment would be permitted to be made at the time of such designation under Section 9.04(b)(ii). Except as provided in this Section 9.14(b), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after such designation, no Default or Event warranties of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Restricted Subsidiaries would have been contained in compliance with all each of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) Loan Documents are true and 7.11(b) correct on and as of such date as if made on and as of the end date of the most recent fiscal quarter. such redesignation (d) All Subsidiaries or, if stated to have been made expressly as of an Unrestricted Subsidiary earlier date, were true and correct as of such date), (ii) no Event of Default would exist, and (iii) the Borrower complies with the requirements of Sections 8.13, 8.16 and 9.11. Any such designation shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary treated as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation a cash dividend in an amount equal to the lesser of the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of direct and indirect ownership interest in such Subsidiary existing at such timeor the amount of the Borrower’s cash investment previously made for purposes of the limitation on Investments under Section 9.04(b)(ii). (fd) IfThe Borrower will cause the management, at any time, any Unrestricted Subsidiary would fail to meet the requirements business and affairs of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary each of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted and its Restricted Subsidiaries to be incurred as conducted in such a manner (including, without limitation, by keeping separate books of such date under Section 7.01 and/or Section 7.02account, hereof, as applicable, furnishing separate financial statements of Unrestricted Subsidiaries to creditors and potential creditors thereof and by not permitting Properties of the Borrower and its respective Restricted Subsidiaries to be commingled) so that each Unrestricted Subsidiary that is a corporation will be in default of such covenanttreated as a corporate entity separate and distinct from Borrower and the Restricted Subsidiaries.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 4.15 as of the Closing Date in writing to the Administrative Agent pursuant to this Sectionor thereafter, assuming compliance with Section 6.11(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by prior written notice thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after such designationgiving effect, no Default or Event of Default exists or would exist, (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreement. (c) The Borrower may designate an Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before (A) the representations and after warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), and (B) no Default or Event of Default exists or would exist (and the Borrower shall be in compliance, on a Pro Forma Basis, with the covenants set forth in Section 7.1); and (ii) after giving effect the Investment deemed to be made in such Subsidiary pursuant to the next sentence would be permitted to be made at the time of such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiariesunder Section 7.7(e). The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Restricted Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such an Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment thereindirect and indirect ownership interest in such Subsidiary. Except as provided in this Section 6.11(b), no Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. (c) The designation of Borrower may designate by prior written notice thereof to the Administrative Agent any Unrestricted Subsidiary as to be a Restricted Subsidiary if immediately prior, and after giving effect to such designation, (i) (A) the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), (ii) no Default or Event of Default exists or would exist (and the Borrower shall be in compliance, on a Pro Forma Basis, with the covenants set forth in Section 7.1) and (ii) the Borrower is in compliance with the requirements of Section 6.9 and Section 7.18. Any such designation shall (x) be treated as a cash dividend in an amount equal to the lesser of the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary or the amount of the Borrower’s cash investment previously made for purposes of the limitation on Investments under Section 7.7(e) or Section 7.7(j) and (y) constitute the incurrence at the time of such designation of any Investment, Indebtedness or Liens of such Subsidiary existing at such time. (fd) IfThe Borrower will cause the management, at any timebusiness and affairs of each Group Member to be conducted in such a manner (including, any without limitation, by keeping separate books of account, furnishing separate financial statements of Unrestricted Subsidiaries to creditors and potential creditors thereof and by not permitting Properties of the Group Members to be commingled) so that each Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary that is a corporation will be deemed to be incurred by treated as a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenantcorporate entity separate and distinct from each Group Member.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 7.14 as of the Closing Date in writing to the Administrative Agent pursuant to this Sectiondate hereof or thereafter, assuming compliance with Section 9.06(b), any Person that becomes a Subsidiary of the Borrower Parent or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary (other than the Borrower), including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no Default or neither an Event of Default exists or nor a Borrowing Base Deficiency would exist, (ii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Parent’s direct and indirect ownership interest in such Subsidiary and such Investment would be permitted to be made at the time of such designation under Section 9.05(i), and (iii) no such Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as is not a “restricted subsidiary” for purposes of or guarantor with respect to any indenturePermitted Senior Unsecured Notes, credit agreementPermitted Junior Lien Debt or Permitted Pari Term Loan Debt. Except as provided in this Section 9.06(b), or similar agreementno Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of the Borrower, the Parent and its other Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default exists or would exist and (iiiii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance complies with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted SubsidiarySection 8.14, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement Section 8.16 and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.14.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated as an Unrestricted Subsidiary on Schedule 7.14 as of the date hereof or otherwise in compliance with this Section 9.08 for any designation after the Closing Date in writing to the Administrative Agent pursuant to this Sectiondate hereof, assuming compliance with Section 9.08(b), any Person that becomes a Subsidiary of the Borrower Parent or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate (on behalf of itself or the Person that owns the Equity Interests of the applicable Subsidiary) by written notification thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no neither a Default or Event of Default exists or nor a Borrowing Base Deficiency would exist, and (ii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Parent’s direct and (iii) indirect ownership interest in such Subsidiary and such Investment would be permitted to be made at the time of such designation under Section 9.05. Except as provided in this Section 9.08(b), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of the Parent Group and their respective Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such designationdate as if made on and as of the date of such redesignation (or, no Default if stated to have been made expressly as of an earlier date, were true and correct in all material respects (or, if already qualified by materiality, Material Adverse Effect or Event a similar qualification, true and correct in all respects) as of Default exists or would exist and such date), (ii) after giving effect to no Default would exist, and (iii) the Borrower complies with the requirements of Section 8.13, Section 8.17 and Section 9.15. Any such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary treated as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation a cash dividend in an amount equal to the lesser of the fair market value of the Parent’s direct and indirect ownership interest in such Subsidiary or the amount of the Borrower’s or applicable Loan Party’s cash investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary previously made for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date limitation on Investments under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.05.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Section, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate any Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist, (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all of the covenants contained set forth in this Agreement, including, without limitation, Sections 7.11(a7.14(b) and 7.15(b), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iiiiv) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indentureindenture or agreement governing Unsecured Note Indebtedness and (v) in the case of a Subsidiary which is already classified as a Restricted Subsidiary (other than an Immaterial Subsidiary), credit agreementthe Borrower has obtained the prior written consent of the Administrative Agent and the Required Lenders. Except as provided in this Section, or similar agreementno Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist and (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all of the covenants contained set forth in this Agreement, including, without limitation, Sections 7.11(a7.14(b) and 7.11(b) as of the end of the most recent fiscal quarter7.15(b). (d) All The Borrower will not, and will not permit any of the Restricted Subsidiaries to, Guarantee any Indebtedness or other obligations of any Unrestricted Subsidiary, other than (i) Letters of Credit issued hereunder for the account of an Unrestricted Subsidiary shall be also subject to the limitations contained in Section 2.03(a) and (ii) Guarantees of performance obligations of any Unrestricted Subsidiaries. Subsidiary arising in the ordinary course of business and related to the operation of such Unrestricted Subsidiary’s business; provided that, for the avoidance of doubt, no such Guarantee under the forgoing clause (ii) shall, directly or indirectly, (A) benefit the holder of Indebtedness of such Unrestricted Subsidiary or (B) Guarantee payment obligations of an Unrestricted Subsidiary, including accounts payable and capital expenditures, or payment obligations related to the purchase, construction or development of property. (e) The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of Subsidiary or any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Included Unrestricted Subsidiary, it will thereafter cease to be except that an Included Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be may hold Equity Interests in default of such covenantanother Included Unrestricted Subsidiary.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Section, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Subject to the limitations set forth in the definition of “Unrestricted Subsidiary,” the Borrower may designate any Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist, (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all of the covenants contained set forth in this Agreement, including, without limitation, Sections 7.11(a), 7.11(bSection 7.11 as of the last day of the immediately preceding Test Period for which a Compliance Certificate has been delivered (determined on a Pro Forma Basis giving effect to such designation), and 7.11(c) as of the end of the most recent fiscal quarter; and (iiiiv) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indentureindenture or agreement governing Indebtedness in an aggregate principal amount of at least $25,000,000. The designation of any Restricted Subsidiary as an Unrestricted Subsidiary shall constitute an Investment by the Borrower and the Restricted Subsidiaries therein at the date of designation in an amount equal to the net book value of their investments therein at the time of such designation. In the event any Person becomes a Subsidiary as a result of the Borrower or a Restricted Subsidiary making a further Investment (an “Investment Increase”) in a Person in which the Borrower or such Restricted Subsidiary had previously made or had an Investment and such Person was not then a Subsidiary, credit agreement, the Borrower or similar agreementsuch Restricted Subsidiary may designate such Subsidiary as an Unrestricted Subsidiary without any change or adjustment in the amount of any Investment under Section 7.02 other than giving effect to the amount of such Investment Increase. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist and (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all of the covenants contained set forth in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) Section 7.11 as of the end last day of the most recent fiscal quarter. immediately preceding Test Period for which a Compliance Certificate has been delivered (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary determined on a Pro Forma Basis giving effect to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment thereindesignation). The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Section, any Person that becomes a Subsidiary of the MLP, the Borrower or any of its Restricted Subsidiaries Subsidiary after the Closing Date shall be classified as a Restricted Subsidiary. (b) The Borrower may designate a any Subsidiary (including any newly-formed or newly-acquired Subsidiary) of the MLP or the Borrower as an Unrestricted Subsidiary if (i) immediately before the representations and after warranties of the Loan Parties contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such designation (or, if made as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default then exists or would existresult therefrom, (iiiii) immediately after giving effect to such designation, the MLP, the Borrower and their Restricted Subsidiaries are in pro forma compliance with all of the covenants set forth in Section 7.14, and (iv) after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Subsidiary may be designated as an such Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenturehas no Indebtedness, credit agreement, or similar agreementother than Non-Recourse Obligations. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if (i) the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if made as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default then exists or would result therefrom, and (iii) immediately after giving effect to such designation, (i) immediately before and after such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basisthe MLP, the Borrower and its the Restricted Subsidiaries would have been are in pro forma compliance with all of the covenants contained set forth in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarterSection 7.14. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary At least ten (10) days prior to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of any designation in an amount equal or re-designation pursuant to clauses (b) or (c) above (or such shorter period as the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.Administrative Agent shall

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) As of the Effective Date, each Subsidiary of the Borrower, including, without limitation, each Xxxxxxx Entity and each Existing Guarantor, shall be classified and designated as a Restricted Subsidiary. Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Sectionby the Borrower in accordance with Section 1.07(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries after the Effective Date (whether by formation, acquisition, merger or otherwise) shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by prior written notice thereof to the Administrative Agent, any Restricted Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if Subsidiary; provided that (i) both immediately before before, and immediately after giving effect, to such designation, (A) no Default or Event of Default or Borrowing Base Deficiency exists or would exist, (ii) after giving effect to result from such designation and (B) the Borrower shall be in compliance, on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained set forth in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(cSection 9.01; (ii) as of the end of the most recent fiscal quarter; and (iii) no such Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as is not a “restricted subsidiary” for purposes of any indenture, credit agreement, indenture or similar agreement. other agreement governing Debt for borrowed money of the Borrower or a Restricted Subsidiary; (ciii) The Borrower may designate an Unrestricted Subsidiary such designation shall be deemed to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before and after such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary and such designation shall be permitted only to the extent such Investment is permitted under Section 9.05(h) or applicable Section 9.05(n) on the date of such designation (without regard to any future fluctuations in value); (iv) such designation shall be deemed to be a Disposition pursuant to which the provisions of Section 2.07(e) and Section 9.12 shall apply; (v) after giving effect to such designation, such Subsidiary is in compliance with the requirements of Section 8.18; and (vi) the Administrative Agent shall have received a certificate of a Responsible Officer, in form and substance reasonably satisfactory to the Administrative Agent, certifying as to the satisfaction of the conditions and matters set forth in clauses (i)-(v) above (and in the case of clause (i)(B) above, setting forth reasonably detailed calculations demonstrating compliance on a pro forma basis with the covenants set forth in Section 9.01). Except as provided in this Section 1.07, no Subsidiary may be designated (and no Restricted Subsidiary may be redesignated) as an Unrestricted Subsidiary. (c) The Borrower may designate by prior written notice thereof to the Administrative Agent any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that (i) both immediately before, and immediately after giving effect, to such designation, (A) no Event of Default or Borrowing Base Deficiency exists or would result from such designation, (B) the Borrower shall be in compliance, on a pro forma basis, with the covenants set forth in Section 9.01, (C) the representations and warranties of the Loan Party’s investment therein. The Parties contained in this Agreement and each of the other Loan Documents shall be true and correct in all material respects (except that any representation and warranty that is qualified by materiality shall be true and correct in all respects) on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects (except that any representation and warranty that is qualified by materiality shall be true and correct in all respects) as of such date), (iii) the designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute be deemed to be the incurrence at the time of designation of any Indebtedness Investment, Debt, or Liens of such Subsidiary existing at such time. , and the Borrower shall be in compliance with Article IX after giving effect to such designation, (fiv) Ifimmediately after giving effect to such designation, at any time, any Unrestricted the Borrower and such Subsidiary would fail to meet shall be in compliance with the requirements of Section 8.14 and Section 8.17 and (v) the definition Administrative Agent shall have received a certificate of Unrestricted Subsidiarya Responsible Officer, it will thereafter cease in form and substance reasonably satisfactory to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed the Administrative Agent, certifying as to be incurred by a Restricted Subsidiary the satisfaction of the Borrower as conditions and matters set forth in clauses (i)-(iv) above (and in the case of such date andclause (i)(B) above, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under setting forth reasonably detailed calculations demonstrating compliance on a pro forma basis with the covenants set forth in Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.01).

Designation and Conversion of Restricted and Unrestricted Subsidiaries. 108 (a) Unless designated after as an Unrestricted Subsidiary on Schedule 7.14 as of the Closing Date in writing to the Administrative Agent pursuant to this Sectiondate hereof or thereafter, assuming compliance with Section 9.06(b), any Person that becomes a Subsidiary of the Borrower Parent or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary (other than the Borrower), including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no Default or neither an Event of Default exists or nor a Borrowing Base Deficiency would exist, (ii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Parent’s direct and indirect ownership interest in such Subsidiary and such Investment would be permitted to be made at the time of such designation under Section 9.05(i), and (iii) no such Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as is not a “restricted subsidiary” for purposes of or guarantor with respect to any indenturePermitted Senior Unsecured Notes or Permitted Junior Lien Debt. Except as provided in this Section 9.06(b), credit agreement, or similar agreementno Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of the Borrower, the Parent and its other Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default exists or would exist and (iiiii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance complies with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted SubsidiarySection 8.14, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement Section 8.16 and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.14.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated as an Unrestricted Subsidiary after the Closing Date in writing to the Administrative Agent pursuant to this Section, any Person that becomes a Subsidiary of the Borrower Borrowers or any of its the Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The MLP Borrower may designate a Subsidiary as an Unrestricted Subsidiary if (i) immediately before and after such designation, no Default or Event of Default exists or would exist, (ii) after giving effect to such designation on a pro forma basis, the MLP Borrower and its the Restricted Subsidiaries would have been in compliance with all of the financial covenants contained set forth in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) Section 7.9 as of the end of the most recent fiscal quarter; and quarter for which financial statements have been delivered pursuant to Section 7.1, (iii) such Subsidiary has no Lien on the assets of a Borrower other than Liens permitted under Section 8.2 and (iv) such Subsidiary may be has not previously been designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementpursuant to this Section 7.18(a). (c) The MLP Borrower may designate an Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before and after such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower Borrowers and its their Restricted Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) Section 7.9 as of the end of the most recent fiscal quarterquarter for which financial statements have been delivered pursuant to Section 7.1. (d) All Subsidiaries of an Unrestricted Subsidiary shall also be also Unrestricted Subsidiaries. The Borrower Borrowers will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, in any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Credit Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Sectionby the Borrower, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries (whether by formation, acquisition or merger) shall be classified as a Restricted Subsidiary. (b) The Any Subsidiary of the Borrower (including a newly formed or newly acquired Subsidiary) may designate a Subsidiary be designated (or redesignated) as an Unrestricted Subsidiary if (i) immediately before the Administrative Agent shall have received (1) a written designation from the Borrower specifying the applicable Subsidiary and after such designationother information as the Administrative Agent may reasonably request, and (2) a certificate of a Responsible Officer of the Borrower certifying that the condition set forth in Section 1.7(b)(ii) is satisfied as of the date of such designation and that no Default or Event of Default exists Borrowing Base deficiency shall then exist or would exist, result from such designation (ii) after giving effect to such designation designation) (and, as a condition precedent to the effectiveness of any such designation, the Borrower shall deliver to the Administrative Agent a certificate setting forth in reasonable detail the calculations demonstrating compliance on a pro forma basis, with the covenants set forth in Section 6.1 (including Pro Forma Compliance with the financial ratio covenant set forth in Section 6.1(a)), (ii) the representations and warranties of Borrower and its Restricted Subsidiaries would contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (iii) such designation is deemed to be an Investment in an amount equal to the fair market value of Borrower’s direct and indirect ownership interest in such Subsidiary and such Investment would be permitted under clause (ii) in the proviso at the end of Section 6.6, (iv) such Subsidiary is in compliance with all the requirements of Section 5.16, and (v) such Subsidiary (A) is not a Material Domestic Subsidiary, (B) is not the owner or the operator, by contract or otherwise, of any Oil and Gas Properties included in the Borrowing Base, (C) does not provide gathering, transporting, processing, marketing or other midstream services in respect of the covenants contained Oil and Gas Properties included in the Borrowing Base and (D) is not a guarantor or the primary obligor with respect to any Indebtedness, liabilities or other obligations under any Permitted Debt, the Senior Notes or the Preferred Stock (or any Permitted Refinancing Debt thereof). Except as provided in this AgreementSection 1.7, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Subsidiary may be designated (and no Restricted Subsidiary may be redesignated) as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The If, at any time, any Unrestricted Subsidiary would fail to meet the requirements for an Unrestricted Subsidiary set forth in Section 5.16, it shall thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness of such Subsidiary shall be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness is not permitted to be incurred as of such date under Section 6.2, the Borrower shall be in default of such covenant. (d) Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default then exists or would exist and result from such redesignation (ii) after giving effect to such designation on a pro forma basisredesignation), (iii) the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time, and the Borrower is in compliance with Sections 6.2 and 6.3 after giving effect to such designation, and (iv) the Borrower complies, or causes such Subsidiary to comply, with the requirements of Section 5.9. Any such designation shall be evidenced by a certificate of a Responsible Officer of the Borrower delivered to the Administrative Agent prior to such designation certifying that the conditions of this Section 1.7(d) are satisfied as of the date of such designation (and, as a condition precedent to the effectiveness of any such designation, the Borrower shall deliver to the Administrative Agent a certificate setting forth in reasonable detail the calculations demonstrating compliance on a pro forma basis, with the covenants set forth in Section 6.1 (including Pro Forma Compliance with the financial ratio covenant set forth in Section 6.1(a)). (fe) If, at any time, any Unrestricted No Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to may be designated as an Unrestricted Subsidiary hereunder unless it is also designated as an “Unrestricted Subsidiary” for purposes of this Agreement the Senior Notes Documents or any Permitted Debt Documents and any Indebtedness and Liens of such (ii) no Subsidiary will designated as an Unrestricted Subsidiary may be deemed to be incurred by designated as a Restricted Subsidiary hereunder unless it is also designated as a “Restricted Subsidiary” for purposes of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenantSenior Notes Documents or any Permitted Debt Documents.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 7.14 as of the Closing Date in writing to the Administrative Agent pursuant to this Sectiondate hereof or thereafter, assuming compliance with Section 9.15(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary, including a newly formed or newly acquired Subsidiary (including any member of the Alpha Shale Group if such Person becomes a Subsidiary at any time), as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no a Default or Event of Default exists or would exist, not exist and (ii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Borrower’s direct and (iiiindirect ownership interest in such Subsidiary and such Investment would be permitted to be made under Section 9.05(h) and/or, in the case of any designation of any member of the Alpha Shale Group as an Unrestricted Subsidiary, Section 9.05(i). Except as provided in this Section 9.15(b), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default exists or would exist and (iiiii) after giving effect to such designation on a pro forma basis, the Borrower complies with the requirements of Section 8.14, Section 8.15 and its Subsidiaries would have been in compliance with all of the covenants contained in this AgreementSection 9.13. Upon any such designation, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the lesser of the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary or applicable Loan Partythe amount of the Borrower’s cash investment therein. The designation of any Unrestricted Subsidiary as a Restricted previously made in such Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary deemed no longer outstanding for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date limitation on Investments under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.05(h).

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Effective Date in writing to the Administrative Agent pursuant to this Section, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries after the Effective Date shall be classified as a Restricted Subsidiary. (b) The Borrower may designate any Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if Subsidiary, provided that (i) any such designation shall be deemed to be an Investment on the date of such designation in an Unrestricted Subsidiary in an amount equal to the sum of the (A) the fair market value of the outstanding Investments of the Borrower and the Restricted Subsidiaries in such Unrestricted Subsidiary and (B) the aggregate principal amount of any Indebtedness owed by such Unrestricted Subsidiary to the Borrower and its Restricted Subsidiaries immediately before prior to such designation, all calculated, on a consolidated basis in accordance with GAAP, (ii) the representations and warranties of the Loan Parties contained in each of the Loan Documents shall be true and correct on and as of the date of such designation as if made on and as of such date (or, if stated to have been made expressly as of an earlier date, were true and correct as of such earlier date), (iii) after giving effect to such designation, no Default or Event of Default exists or would exist, (iiiv) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all of the covenants contained set forth in this AgreementSection 6.10, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c(v) as of the end of the most recent fiscal quarter; and (iii) no such Subsidiary may be designated as an Unrestricted Subsidiary if it will shall be treated as a an “restricted subsidiaryUnrestricted Subsidiary” for purposes of any indentureindenture or agreement governing notes which is permitted under the terms of this Agreement and to which any Loan Party is or becomes a party, credit agreement(vi) the Investment represented by such designation shall be permitted under Section 6.04(a)(xiv) and (vii) the Borrower shall provide to the Administrative Agent an Officer’s Certificate in form satisfactory to the Administrative Agent to the effect that each of the foregoing conditions has been satisfied. Except as provided in this Section, or similar agreementno Restricted Subsidiary may be re-designated as an Unrestricted Subsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct in all material respects (or in all respects if such representation or warranty is by its terms already qualified as to materiality) on and as of the date of such designation as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such earlier date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist and (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all of the covenants contained set forth in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarterSection 6.10. (d) All The Borrower will not, and will not permit any of the Restricted Subsidiaries to, guarantee any Indebtedness or other obligations of any Unrestricted Subsidiary, other than (i) to the extent permitted by Section 6.04 and (ii) guarantees of performance obligations of any Unrestricted Subsidiary arising in the ordinary course of business and related to the operation of such Unrestricted Subsidiary’s business; provided that, for the avoidance of doubt, no such Guarantee under the forgoing clause (ii) shall, directly or indirectly, (A) benefit the holder of Indebtedness of such Unrestricted Subsidiary or (B) guarantee payment obligations of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. Subsidiary, including accounts payable and capital expenditures, or payment obligations related to the purchase, construction or development of property. (e) The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted SubsidiarySubsidiary or any Material Project JV. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Section, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Subject to the limitations set forth in the definition of “Unrestricted Subsidiary,” the Borrower may designate any Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist, (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all the covenant set forth in Section 7.11 as of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(blast day of the immediately preceding Test Period for which a Compliance Certificate has been delivered (determined on a Pro Forma Basis giving effect to such designation), and 7.11(c) as of the end of the most recent fiscal quarter; and (iiiiv) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indentureindenture or agreement governing Indebtedness in an aggregate principal amount of at least $25,000,000. The designation of any Restricted Subsidiary as an Unrestricted Subsidiary shall constitute an Investment by the Borrower and the Restricted Subsidiaries therein at the date of designation in an amount equal to the net book value of their investments therein at the time of such designation. In the event any Person becomes a Subsidiary as a result of the Borrower or a Restricted Subsidiary making a further Investment (an “Investment Increase”) in a Person in which the Borrower or such Restricted Subsidiary had previously made or had an Investment and such Person was not then a Subsidiary, credit agreement, the Borrower or similar agreementsuch Restricted Subsidiary may designate such Subsidiary as an Unrestricted Subsidiary without any change or adjustment in the amount of any Investment under Section 7.02 other than giving effect to the amount of such Investment Increase. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist and (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all of the covenants contained covenant set forth in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) Section 7.11 as of the end last day of the most recent fiscal quarter. immediately preceding Test Period for which a Compliance Certificate has been delivered (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary determined on a Pro Forma Basis giving effect to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment thereindesignation). The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Section, any Person that becomes a Subsidiary of the MLP, the Borrower or any of its Restricted Subsidiaries Subsidiary after the Closing Date shall be classified as a Restricted Subsidiary. (b) The Borrower may designate a any Subsidiary (including any newly-formed or newly-acquired Subsidiary) of the MLP or the Borrower as an Unrestricted Subsidiary if (i) immediately before the representations and after warranties of the Loan Parties contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such designation (or, if made as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default then exists or would existresult therefrom, (iiiii) immediately after giving effect to such designation, the MLP, the Borrower and their Restricted Subsidiaries are in pro forma compliance with all of the covenants set forth in Section 7.14, and (iv) after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Subsidiary may be designated as an such Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenturehas no Indebtedness, credit agreement, or similar agreementother than Non-Recourse Obligations. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if (i) the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if made as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default then exists or would result therefrom, and (iii) immediately after giving effect to such designation, (i) immediately before and after such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basisthe MLP, the Borrower and its the Restricted Subsidiaries would have been are in pro forma compliance with all of the covenants contained set forth in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarterSection 7.14. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary At least ten (10) days prior to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of any designation in an amount equal or re-designation pursuant to clauses (b) or (c) above (or such shorter period as the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary Administrative Agent shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicableagree), the Borrower will be shall provide a certificate to the Administrative Agent, in default of such covenantform and substance satisfactory to the Administrative Agent, demonstrating compliance with the covenants set forth in this Section 6.17.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 7.14 as of the Closing Date in writing to the Administrative Agent pursuant to this Sectiondate hereof or thereafter, assuming compliance with Section 9.15(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by written notification thereof to the Administrative Agent, any Restricted Subsidiary, including a newly formed or newly acquired Subsidiary (including any member of the Alpha Shale Group if such Person becomes a Subsidiary at any time), as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, no neither a Default or Event of Default exists or nor a Borrowing Base Deficiency would exist, exist and (ii) after giving effect to such designation on a pro forma basis, is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) fair market value as of the end date of such designation of the most recent fiscal quarter; Borrower’s direct and (iiiindirect ownership interest in such Subsidiary and such Investment would be permitted to be made under Section 9.05(h) and/or, in the case of any designation of any member of the Alpha Shale Group as an Unrestricted Subsidiary, Section 9.05(i). Except as provided in this Section 9.15(b), no Restricted Subsidiary may be designated redesignated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreementSubsidiary. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and after warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default exists or would exist and (iiiii) after giving effect to such designation on a pro forma basis, the Borrower complies with the requirements of Section 8.14, Section 8.15 and its Subsidiaries would have been in compliance with all of the covenants contained in this AgreementSection 9.13. Upon any such designation, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the lesser of the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary or applicable Loan Partythe amount of the Borrower’s cash investment therein. The designation of any Unrestricted Subsidiary as a Restricted previously made in such Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary deemed no longer outstanding for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date limitation on Investments under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant9.05(h).

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after as an Unrestricted Subsidiary on Schedule 4.13 as of the Closing Effective Date in writing to the Administrative Agent pursuant to this Sectionor thereafter, assuming compliance with Section 6.15(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) . The Borrower may designate by prior written notice thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after giving effect, to such designation, (A) the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), and (B) no Default or Event of Default exists or would existresult therefrom (and the Borrower shall be in compliance, (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained set forth in this AgreementSection 7.13); (ii) such Subsidiary (A) is not the owner or the operator, includingby contract or otherwise, without limitationof any Oil and Gas Interests and (B) is not a guarantor or the primary obligor with respect to any indebtedness, Sections 7.11(a)liabilities or other obligations under any Senior Notes, 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarterSecond Lien Debt or other Material Indebtedness; and (iii) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreement. (c) The Borrower may designate an Unrestricted Subsidiary the Investment deemed to be a Restricted made in such Subsidiary if after giving effect pursuant to such designation, (i) immediately before and after such designation, no Default or Event the next sentence would be permitted to be made at the time of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiariesunder Section 7.06. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Restricted Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such an Unrestricted Subsidiary at the date of designation in an amount equal to the aggregate amount of the Borrower’s or any Restricted Subsidiary’s Investments previously made in or to such Subsidiary. Except as provided in this Section 6.15(b), no Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. The Borrower may designate by prior written notice thereof to the Administrative Agent any Unrestricted Subsidiary to be a Restricted Subsidiary if (i) immediately prior, and after giving effect to such designation, the representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), (ii) no Default exists or would result therefrom (and the Borrower shall be in compliance, on a pro forma basis, with the covenants set forth in Section 7.13) and (iii) the Borrower is in compliance with the requirements of Section 6.09. Any such designation shall (x) be treated as a cash dividend in an amount equal to the lesser of the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary or applicable Loan Partythe amount of the Borrower’s cash investment therein. The designation previously made for purposes of the limitation on Investments under Section 7.06(b) or under any Unrestricted Subsidiary other subsection of Section 7.06, as a Restricted Subsidiary shall the case may be, and (y) constitute the incurrence at the time of such designation of any Investment, Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be in default of such covenant.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this SectionAssuming compliance with Section 9.23(b), any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate by prior written notice thereof to the Administrative Agent, any Restricted Subsidiary, including a Subsidiary newly formed or newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) immediately before prior, and after such designationgiving effect, no Default or Event of Default exists or would exist, (ii) after giving effect to such designation on a pro forma basis, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenture, credit agreement, or similar agreement. (c) The Borrower may designate an Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (iA) immediately before the representations and after warranties of each Credit Party contained in each of the Loan Papers are true and correct in all material respects (without duplication of any materiality qualifier contained therein) on and as of such designationdate as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects (without duplication of any materiality qualifier contained therein) as of such date), (B) no Default or Event of Default exists or would exist (and (ii) after giving effect to such designation the Borrower shall be in compliance, on a pro forma basis, with the covenants set forth in Section 9.01 and, as a condition precedent to the effectiveness of any such designation, the Borrower shall deliver to the Administrative Agent a certificate setting forth in reasonable detail the calculations demonstrating such compliance on a pro forma basis and certifying as to the satisfaction of the other conditions set forth in this Section 9.23(b)), (C) such Subsidiary (1) is not the owner or the operator, by contract or otherwise, of any Oil and Gas Properties included in the Borrowing Base, (2) does not provide gathering, transporting, processing, marketing or other midstream services in respect of the Oil and Gas Properties included in the Borrowing Base and (3) is not a guarantor, “restricted subsidiary” or the primary obligor with respect to any Debt, liabilities or other obligations under any Permitted Debt or the Senior Notes (or any Permitted Refinancing Debt thereof) and (D) no Borrowing Base Deficiency would exist; and (ii) the Investment deemed to be made in such Subsidiary (and its Subsidiaries subsidiaries) pursuant to the next sentence would have been in compliance with all be permitted to be made at the time of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarter. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiariessuch designation under Section 9.06. The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Restricted Subsidiary as an Unrestricted Subsidiary shall (a) constitute an Investment in such an Unrestricted Subsidiary at the date of designation (and its subsidiaries) in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation direct and indirect ownership interest in such Subsidiary (and its subsidiaries) and (b) be deemed a disposition of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens Property of such Subsidiary existing at such time. (fand its subsidiaries) (and Equity Interests therein) for purposes of Section 9.05(d) (and, for the avoidance of doubt, Section 3.04(c)(ii)). Except as provided in this Section 9.23(b), no Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of for an Unrestricted SubsidiarySubsidiary set forth in Section 8.16, it will shall thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens Debt of such Subsidiary will shall be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are Debt is not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable9.02, the Borrower will shall be in default of such covenant. (c) The Borrower may designate by prior written notice thereof to the Administrative Agent any Unrestricted Subsidiary to be a Restricted Subsidiary if (i) immediately prior, and after giving effect to such designation, (A) the representations and warranties of each Credit Party contained in each of the Loan Papers are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), (B) no Event of Default exists or would exist (and the Borrower shall be in compliance, on a pro forma basis, with the covenants set forth in Section 9.01) and (ii) the Borrower is in compliance with the requirements of Section 8.14 and Section 8.16. Any such designation shall (x) be treated as a cash dividend in an amount equal to the lesser of the fair market value of the Borrower’s direct and indirect ownership interest in such Subsidiary or the amount of the Borrower’s cash investment previously made for purposes of any applicable limitations on Investments under Section 9.06 and (y) constitute the incurrence at the time of such designation of any Investment, Debt or Liens of such Subsidiary existing at such time. Any such designation shall be evidenced by a certificate of a Responsible Officer of the Borrower delivered to the Administrative Agent prior to such designation certifying that the conditions of this Section 9.23(c) are satisfied as of the date of such designation (and, as a condition precedent to the effectiveness of any such designation, the Borrower shall deliver to the Administrative Agent a certificate setting forth in reasonable detail the calculations demonstrating compliance on a pro forma basis, with the covenants set forth in Section 9.01 (including Pro Forma Compliance with the financial ratio covenant set forth in Section 9.01(a))). (d) (i) No Subsidiary may be designated as an Unrestricted Subsidiary hereunder unless it is also designated as an “Unrestricted Subsidiary” (or an analogous designation) for purposes of the Senior Notes Documents or any Permitted Debt Documents and (ii) no Subsidiary designated as an Unrestricted Subsidiary may be designated as a Restricted Subsidiary hereunder unless it is also designated as a “Restricted Subsidiary” (or an analogous designation) for purposes of the Senior Notes Documents or any Permitted Debt Documents.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Section, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. (b) The Borrower may designate any Subsidiary (including a Subsidiary newly formed or newly acquired Subsidiary) as an Unrestricted Subsidiary if (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist, (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all of the covenants contained set forth in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), 7.14(b) (prior to the Collateral Release Date) and 7.11(c7.15(b) as of the end of the most recent fiscal quarter; and (iiiiv) no Subsidiary may be designated as an Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indentureindenture or agreement governing Unsecured Note Indebtedness. Notwithstanding the foregoing, credit agreementthe Borrower may designate as an “Unrestricted Subsidiary” a Person (whether formed before or after the Closing Date) that owns, directly or similar agreementindirectly, Targa Downstream LLC’s 38.75% interest in Gulf Coast Fractionators. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) immediately before the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct as of such date), (ii) after giving effect to such designation, no Default or Event of Default exists or would exist and (iiiii) immediately after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Restricted Subsidiaries would have been shall be in pro forma compliance with all of the covenants contained set forth in this Agreement, including, without limitation, Sections 7.11(a7.14(b) (prior to the Collateral Release Date) and 7.11(b) as of the end of the most recent fiscal quarter7.15(b). (d) All The Borrower will not, and will not permit any of the Restricted Subsidiaries to, Guarantee any Indebtedness or other obligations of any Unrestricted Subsidiary, other than (i) letters of credit issued for the account of an Unrestricted Subsidiary shall be also (other than letters of credit constituting Guarantees of Indebtedness) and (ii) Guarantees (other than Letters of Credit) of obligations of any Unrestricted Subsidiaries. Subsidiary (other than Indebtedness) arising in the ordinary course of business and related to the operation of such Unrestricted Subsidiary’s business (A) to the extent existing on the Closing Date and set forth on Schedule 6.17(d) or (B) to the extent incurred after the Closing Date, so long as such Guarantee is permitted by Section 7.02. (e) The Borrower will not permit any Unrestricted Subsidiary to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of Subsidiary or any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of designation in an amount equal to the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Included Unrestricted Subsidiary, it will thereafter cease to be except that an Included Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicable, the Borrower will be may hold Equity Interests in default of such covenantanother Included Unrestricted Subsidiary.

Designation and Conversion of Restricted and Unrestricted Subsidiaries. (a) Unless designated after the Closing Date in writing to the Administrative Agent pursuant to this Section, any Person that becomes a Subsidiary of the MLP, the Borrower or any of its Restricted Subsidiaries Subsidiary after the Restatement Effective Date shall be classified as a Restricted Subsidiary. (b) The Borrower may designate a any Subsidiary (including any newly-formed or newly-acquired Subsidiary) of the MLP or the Borrower as an Unrestricted Subsidiary if (i) immediately before the representations and after warranties of the Loan Parties contained in each of the Loan Documents are true and correct on and as of such designationdate as if made on and as of the date of such designation (or, if made as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default then exists or would existresult therefrom, (iiiii) immediately after giving effect to such designation, the MLP, the Borrower and their Restricted Subsidiaries are in pro forma compliance with all of the covenants set forth in Section 7.14, and (iv) after giving effect to such designation on a pro forma basisdesignation, the Borrower and its Subsidiaries would have been in compliance with all of the covenants contained in this Agreement, including, without limitation, Sections 7.11(a), 7.11(b), and 7.11(c) as of the end of the most recent fiscal quarter; and (iii) no Subsidiary may be designated as an such Unrestricted Subsidiary if it will be treated as a “restricted subsidiary” for purposes of any indenturehas no Indebtedness, credit agreement, or similar agreementother than Non-Recourse Obligations. (c) The Borrower may designate an any Unrestricted Subsidiary to be a Restricted Subsidiary if (i) the representations and warranties of the Loan Parties contained in each of the Loan Documents are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if made as of an earlier date, were true and correct as of such date), (ii) no Default or Event of Default then exists or would result therefrom, and (iii) immediately after giving effect to such designation, (i) immediately before and after such designation, no Default or Event of Default exists or would exist and (ii) after giving effect to such designation on a pro forma basisthe MLP, the Borrower and its the Restricted Subsidiaries would have been are in pro forma compliance with all of the covenants contained set forth in this Agreement, including, without limitation, Sections 7.11(a) and 7.11(b) as of the end of the most recent fiscal quarterSection 7.14. (d) All Subsidiaries of an Unrestricted Subsidiary shall be also Unrestricted Subsidiaries. The Borrower will not permit any Unrestricted Subsidiary At least ten (10) days prior to hold any Equity Interests in, or any Indebtedness of, any Restricted Subsidiary. (e) The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment in such Unrestricted Subsidiary at the date of any designation in an amount equal or re-designation pursuant to clause (b) or clause (c) above (or such shorter period as the fair market value of the Borrower’s or applicable Loan Party’s investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary Administrative Agent shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time. (f) If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the definition of Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness and Liens of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness and/or Liens are not permitted to be incurred as of such date under Section 7.01 and/or Section 7.02, hereof, as applicableagree), the Borrower will be shall provide a certificate to the Administrative Agent, in default of such covenantform and substance satisfactory to the Administrative Agent, demonstrating compliance with the covenants set forth in this Section 6.17.