Common use of LIMITATION ON SALE OF PROPERTIES Clause in Contracts

LIMITATION ON SALE OF PROPERTIES. Company will not, and will not permit any of the Subsidiaries to, (a) sell, assign, convey, exchange, lease or otherwise dispose of any of its properties, rights, or assets, whether now owned or hereafter acquired, except for sales of severed hydrocarbons or used, obsolete or worn-out equipment which are made in the ordinary course of its business and for a fair consideration; provided, however, that Company or any Subsidiary may, for fair consideration, sell, assign, convey, exchange, lease or otherwise dispose of (i) properties, rights, assets or business which are not included for purpose of determining the Borrowing Base, and (ii) provided no Event of Default exists hereunder, Mineral Properties which are included for the purpose of determining the Borrowing Base if the net aggregate proceeds (cash or otherwise) received by Company and its Subsidiaries from all such sale or sales of such Mineral Properties do not exceed $35,000,000 during any calendar year or (b) sell, assign or discount, except for fair consideration, any accounts receivable. As to such permitted sales of Mineral Properties, (i) the initial $5,000,000 in net sales proceeds per any calendar year shall be retained by Company without any obligation for payment to Banks of any portion of such proceeds as a mandatory principal payment on the Loan, and there shall be no reduction to the Borrowing Base under Section 5.05 hereof on account of such sales, and (ii) for all permitted sales in excess of $5,000,000 per any calendar year, the Borrowing Base shall be reduced by excluding the Mineral Properties that are subject to such sales according to Section 5.05 and Company shall pay to Banks as a mandatory principal payment on the Loan such portion of the net proceeds derived from such sales as is necessary to cause the then Total Outstandings to not exceed the Borrowing Base then in effect after redetermination under Section 5.05 on account of -63- such sales. The provisions of this Section 9.07 shall not apply to Company's transfer or assignment of Mineral Properties to the Proposed Royalty Trust upon formation of the Proposed Royalty Trust or Company's transfer or sale of any of its units in the Proposed Royalty Trust; provided, however, that Section 5.05(b) shall apply upon Company's transfer or sale of any of its units in the Proposed Royalty Trust.

LIMITATION ON SALE OF PROPERTIES. Company will not, and will not -------------------------------- permit any of the Subsidiaries to, (a) sell, assign, convey, exchange, lease or otherwise dispose of any of its properties, rights, or assets, whether now owned or hereafter acquired, except for sales of severed hydrocarbons or used, obsolete or worn-out equipment which are made in the ordinary course of its business and for a fair consideration; provided, however, that Company or any -------- ------- Subsidiary may, for fair consideration, sell, assign, convey, exchange, lease or otherwise dispose of (i) properties, rights, assets or business which are not included for purpose of determining the Borrowing Base, and (ii) provided no Event of Default exists hereunder, Mineral Properties which are included for the purpose of determining the Borrowing Base if the net aggregate proceeds (cash or otherwise) received by Company and its Subsidiaries from all such sale or sales of such Mineral Properties do not exceed $35,000,000 during any calendar year or (b) sell, assign or discount, except for fair consideration, any accounts receivable. As to such permitted sales of Mineral Properties, (i) the initial $5,000,000 in net sales proceeds per any calendar year shall be retained by Company without any obligation for payment to Banks of any portion of such proceeds as a mandatory principal payment on the Loan, and there shall be no reduction to the Borrowing Base under Section 5.05 hereof on account of such sales, and (ii) for all permitted sales in excess of $5,000,000 per any calendar year, the Borrowing Base shall be reduced by excluding the Mineral Properties that are subject to such sales according to Section 5.05 and Company shall pay to Banks as a mandatory principal payment on the Loan such portion of the net proceeds derived from such sales as is necessary to cause the then Total Outstandings to not exceed the Borrowing Base then in effect after redetermination under Section 5.05 on account of -63- such sales. The provisions of this Section 9.07 shall not apply to Company's transfer (i) the Trade Properties or assignment the Defect Properties, or (ii) any transaction pursuant to which Company transfers its interest (or a portion thereof) in any of the Mineral Properties that would entitle the assignee of such properties to receive certain credits against its federal income tax under Section 29 of the Internal Revenue Code of 1986, as amended, with Company retaining or receiving an interest in such properties, and a portio of the proceeds received by Company upon the transfer of its interest (or a portion thereof) in such properties is attributable to the Proposed Royalty Trust upon formation Section 29 tax credits allocable to such properties (such a transaction is herein called a "Section 29 Transaction"). Company may sell, assign, exchange or otherwise dispose of its interest (or a portion thereof) in any of the Proposed Royalty Trust or Company's transfer or sale Mineral Properties pursuant to a Section 29 Transaction with consent of Majority Banks, whereupon Majority Banks shall approve any of its units adjustments to the Borrowing Base after giving effect to such Section 29 Transaction and the value to be assigned to the interest in the Proposed Royalty Trust; provided, however, that Section 5.05(b) shall apply upon Mineral Properties retained or received by Company's transfer or sale of any of its units in the Proposed Royalty Trust.

LIMITATION ON SALE OF PROPERTIES. Company will not, and will not permit any of the Subsidiaries to, (a) sell, assign, convey, exchange, lease or otherwise dispose of any of its properties, rights, or assets, whether now owned or hereafter acquired, except for sales of severed hydrocarbons or used, obsolete or worn-out equipment which are made in the ordinary course of its business and for a fair consideration; provided, however, that Company or any Subsidiary may, for fair consideration, sell, assign, convey, exchange, lease or otherwise dispose of (i) properties, rights, assets or business which are not included for purpose of determining the Borrowing Base, and (ii) provided no Event of Default exists hereunder, (1) Mineral Properties (exclusive of HGT Units and ART Units) which are included for the purpose of determining the Borrowing Base if the aggregate net aggregate proceeds (cash or otherwise) received by Company and its Subsidiaries from all such sale or sales of such Mineral Properties do not exceed $35,000,000 110,000,000 during any calendar year and (2) HGT Units and/or ART Units which are included for the purpose of determining the Borrowing Base if the net proceeds (cash or otherwise) received by Company and its Subsidiaries from all of such sale or sales of such HGT Units and/or ART Units do not exceed $175,000,000 during any calendar year, or (b) sell, assign or discount, except for fair consideration, any accounts receivable. As to such permitted sales of Mineral Properties, HGT Units and ART Units that are permitted under this Section 9.07, (i) unless and to the extent Section 8.24(a) or (b) shall apply, the initial $5,000,000 in net sales proceeds per any calendar year from such sales shall be retained by Company without any obligation for payment to Banks of any portion of such proceeds as a mandatory principal payment on the LoanLoan according Section 8.24, and (ii) there shall be no reduction to the Borrowing Base under Section 5.05 hereof on account of such salessales until the Property Sale Threshold has occurred, and (iiiii) for all permitted sales in excess of $5,000,000 per any Mineral Properties, HGT Units and ART Units that occur after the Property Sale Threshold has occurred for each calendar year, the Borrowing Base shall be reduced by excluding the Borrowing Base value of the Mineral Properties Properties, HGT Units and ART Units that are subject to such sales according to Section 5.05 5.05(a) and (b) and Company shall pay to Banks as a mandatory principal payment on the Loan such portion of use and apply the net proceeds derived from such sales as is necessary to cause in the then Total Outstandings to not exceed the Borrowing Base then manner provided in effect after redetermination under Section 5.05 on account of -63- 8.24 and (iv) following such sales, Company shall comply with Section 8.20, if applicable. The provisions of this Section 9.07 shall not apply to Company's transfer or assignment of Mineral Properties to the Proposed any Additional Royalty Trust upon the formation of the Proposed Royalty Trust or Company's transfer or sale of any of its units in the Proposed Royalty Trust; provided, however, that Section 5.05(b) shall apply upon Company's transfer or sale of any of its units in the Proposed such Additional Royalty Trust.

LIMITATION ON SALE OF PROPERTIES. Company will not, and will not -------------------------------- permit any of the Subsidiaries to, (a) sell, assign, convey, exchange, lease or otherwise dispose of any of its properties, rights, or assets, whether now owned or hereafter acquired, except for sales of severed hydrocarbons or used, obsolete or worn-out equipment which are made in the ordinary course of its business and for a fair consideration; provided, however, that Company or any -------- ------- Subsidiary -57- may, for fair consideration, sell, assign, convey, exchange, lease or otherwise dispose of (i) properties, rights, assets or business which are not included for purpose of determining the Borrowing Base, and (ii) provided no Event of Default exists hereunder, Mineral Properties which are included for the purpose of determining the Borrowing Base if the net aggregate proceeds (cash or otherwise) received by Company and its Subsidiaries from all such sale or sales of such Mineral Properties do not exceed $35,000,000 during any calendar year or (b) sell, assign or discount, except for fair consideration, any accounts receivable. As to such permitted sales of Mineral Properties, (i) the initial $5,000,000 in net sales proceeds per any calendar year shall be retained by Company without any obligation for payment to Banks of any portion of such proceeds as a mandatory principal payment on the Loan, and there shall be no reduction to the Borrowing Base under Section 5.05 hereof on account of such sales, and (ii) for all permitted sales in excess of $5,000,000 per any calendar year, the Borrowing Base shall be reduced by excluding the Mineral Properties that are subject to such sales according to Section 5.05 and Company shall pay to Banks as a mandatory principal payment on the Loan such portion of the net proceeds derived from such sales as is necessary to cause the then Total Outstandings to not exceed the Borrowing Base then in effect after redetermination under Section 5.05 on account of -63- such sales. The provisions Notwithstanding the foregoing, Company and Banks agree that if the Approved Property Sale is consummated, the Borrowing Base then in effect shall be reduced by $5,000,000 effective as of the date of such sale; further, the proceeds received by Company upon consummation of the Approved Property Sale shall not be included in the initial $5,000,000 in net sales proceeds for the 1997 calendar year that Company otherwise is permitted to retain according to this Section 9.07 shall not apply without any obligation for payment to Company's transfer Banks or assignment of Mineral Properties to the Proposed Royalty Trust upon formation of the Proposed Royalty Trust or Company's transfer or sale of any of its units causing a reduction in the Proposed Royalty Trust; provided, however, that Section 5.05(b) shall apply upon Company's transfer or sale of any of its units in the Proposed Royalty TrustBorrowing Base.