Operation of Mortgaged Properties. The Mortgaged Properties, and with respect to Mortgaged Properties not operated by Mortgagor, to the best of Mortgagor’s knowledge, such non-operated Mortgaged Properties, (and properties unitized therewith) are being (and, to the extent the same could adversely affect the ownership or operation of the Mortgaged Properties after the date hereof, have in the past been), and hereafter will be, maintained, operated and developed in a good and workmanlike manner, in accordance with prudent industry standards and in conformity with all applicable laws and all rules, regulations and orders of all duly constituted authorities having jurisdiction and in conformity with all oil, gas and/or other mineral leases and other contracts and agreements forming a part of the Property and in conformity with the Permitted Encumbrances; specifically in this connection, (i) no Mortgaged Property is subject to having allowable production after the date hereof reduced below the full and regular allowable (including the maximum permissible tolerance) because of any overproduction (whether or not the same was permissible at the time) prior to the date hereof and (ii) none of the xxxxx located on the Mortgaged Properties (or properties unitized therewith) are or will be deviated from the vertical more than the maximum permitted by applicable laws, regulations, rules and orders, and such xxxxx are, and will remain, bottomed under and producing from, with the well bores wholly within, the Mortgaged Properties (or, in the case of xxxxx located on properties unitized therewith, such unitized properties). There are no xxxxx listed on Schedule I hereto (“Schedule I Xxxxx”) being redrilled, deepened, plugged back or reworked, and no other operations are being conducted for which consent is required under the applicable operating agreement (or which are other than normal operation of existing xxxxx on the Mortgaged Properties); except as otherwise disclosed to Agent in writing, there are no proposals in excess of $1,500,000 net to Mortgagor’s interest currently outstanding (whether made by Mortgagor or by any other party) to re-drill, deepen, plug back, or rework Schedule I Xxxxx, or to conduct any other operations under the applicable joint operating agreement, or to abandon any Schedule I Xxxxx (nor are there any such proposals which have been approved either by Mortgagor or any other party, with respect to which the operations covered thereby have not been commenced). Houston 3941837v.4 Except as otherwise disclosed to Agent in writing, there are no dry holes, or otherwise inactive xxxxx, located on the Mortgaged Properties or on lands pooled or unitized therewith (including, without limitation, any xxxxx which would, if located in Texas, require compliance with Railroad Commission Rule 14(b)(2)) that in the aggregate will cost more than $1,500,000, net to Mortgagor’s interest and net of salvage proceeds, to plug and abandon, except for xxxxx that have been properly plugged and abandoned that have not been taken into account in Mortgagor’s financial statements as furnished to Agent. Mortgagor has, and will have in the future, all governmental licenses and permits necessary or appropriate to own and operate the Property; Mortgagor has not received notice of any violations in respect of any such licenses or permits.
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Operation of Mortgaged Properties. The Mortgaged Properties, and with --------------------------------- respect to Mortgaged Properties not operated by Mortgagor, to the best of Mortgagor’s 's knowledge, such non-operated Mortgaged Properties, (and properties unitized therewith) are being (and, to the extent the same could adversely affect the ownership or operation of the Mortgaged Properties after the date hereof, have in the past been), and hereafter will be, maintained, operated and developed in a good and workmanlike manner, in accordance with prudent industry standards and in conformity with all applicable laws and all rules, regulations and orders of all duly constituted authorities having jurisdiction and in conformity with all oil, gas and/or other mineral leases and other contracts and agreements forming a part of the Property and in conformity with the Permitted Encumbrances; specifically in this connection, (i) no Mortgaged Property is subject to having allowable production after the date hereof reduced below the full and regular allowable (including the maximum permissible tolerance) because of any overproduction (whether or not the same was permissible at the time) prior to the date hereof and (ii) none of the xxxxx wells located on the Mortgaged Properties (or properties unitized therewithunitizxx xherewith) are or will be deviated from the vertical more than the maximum permitted by applicable laws, regulations, rules and orders, and such xxxxx wells are, and will remain, bottomed under and producing from, with the wxxx xhe well bores wholly within, the Mortgaged Properties (or, in the case of xxxxx wells located on properties unitized therewith, such unitized properties). There are no xxxxx listed on Schedule I hereto (“Schedule I Xxxxx”) being redrilled, deepened, plugged back or reworked, and no other operations are being conducted for which consent is required under the applicable operating agreement (or which are other than normal operation of existing xxxxx on the Mortgaged Properties); except as otherwise disclosed to Agent in writing, there are no proposals in excess of $1,500,000 net to Mortgagor’s interest currently outstanding (whether made by Mortgagor or by any other party) to re-drill, deepen, plug back, or rework Schedule I Xxxxx, or to conduct any other operations under the applicable joint operating agreement, or to abandon any Schedule I Xxxxx (nor are there any such proposals which have been approved either by Mortgagor or any other party, with respect to which the operations covered thereby have not been commenced). Houston 3941837v.4 Except as otherwise disclosed to Agent in writing, there are no dry holes, or otherwise inactive xxxxx, located on the Mortgaged Properties or on lands pooled or unitized therewith (including, without limitation, any xxxxx which would, if located in Texas, require compliance with Railroad Commission Rule 14(b)(2)) that in the aggregate will cost more than $1,500,000, net to Mortgagor’s interest and net of salvage proceeds, to plug and abandon, except for xxxxx that have been properly plugged and abandoned that have not been taken into account in Mortgagor’s financial statements as furnished to Agent. Mortgagor has, and will have in the future, all governmental licenses and permits necessary or appropriate to own and operate the Property; Mortgagor has not received notice of any violations in respect of any such licenses or permits.unitixxx
Appears in 1 contract
Operation of Mortgaged Properties. The Mortgaged Properties, and with --------------------------------- respect to Mortgaged Properties not operated by Mortgagor, to the best of Mortgagor’s 's knowledge, such non-operated Mortgaged Properties, (and properties unitized therewith) are being (and, to the extent the same could adversely affect the ownership or operation of the Mortgaged Properties after the date hereof, have in the past been), and hereafter will be, maintained, operated and developed in a good and workmanlike manner, in accordance with prudent industry standards and in conformity with all applicable laws and all rules, regulations and orders of all duly constituted authorities having jurisdiction and in conformity with all oil, gas and/or other mineral leases and other contracts and agreements forming a part of the Property and in conformity with the Permitted Encumbrances; specifically in this connection, (i) no Mortgaged Property is subject to having allowable production after the date hereof reduced below the full and regular allowable (including the maximum permissible tolerance) because of any overproduction (whether or not the same was permissible at the time) prior to the date hereof and (ii) none of the xxxxx wells located on the Mortgaged Properties (or properties unitized therewithunitizex xxerewith) are or will be deviated from the vertical more than the maximum permitted by applicable laws, regulations, rules and orders, and such xxxxx wells are, and will remain, bottomed under and producing from, with the wixx xxe well bores wholly within, the Mortgaged Properties (or, in the case of xxxxx wells located on properties unitized therewith, such unitized propertiesunitizxx xxoperties). There are no xxxxx wells listed on Schedule I hereto (“"Schedule I Xxxxx”Wells") being redrilledredrillxx, deepenedxeepened, plugged back or reworked, and no other xxxxx operations are being conducted for which consent is required under the applicable operating agreement (or which are other than normal operation of existing xxxxx wells on the Mortgaged Properties); except as otherwise disclosed to Agent tx Xxxnt in writing, there are no proposals in excess of $1,500,000 500,000 net to Mortgagor’s 's interest currently outstanding (whether made by Mortgagor or by any other party) to re-drill, deepen, plug back, or rework Schedule I XxxxxWells, or to conduct any other operations under the applicable joint xxxxt operating agreement, or to abandon any Schedule I Xxxxx Wells (nor are there any such proposals which have been approved either approvex xxxher by Mortgagor or any other party, with respect to which the operations covered thereby have not been commenced). Houston 3941837v.4 Except as otherwise disclosed to Agent in writing, there are no dry holes, or otherwise inactive xxxxxwells, located on the Mortgaged Properties or on lands pooled or unitized xxxtized therewith (including, without limitation, any xxxxx wells which would, if located in Texas, require compliance with Railroad Commission Rule 14(b)(2)) that in the aggregate will cost more than $1,500,000500,000, net to Mortgagor’s 's interest and net of salvage proceeds, to plug and abandon, except for xxxxx wells that have been properly plugged and abandoned that have not been taken into account in Mortgagor’s financial statements as furnished to Agentabandoned. Mortgagor hashax, and xxd will have in the future, all governmental licenses and permits necessary or appropriate to own and operate the Property; Mortgagor has not received notice of any violations in respect of any such licenses or permits.
Appears in 1 contract
Operation of Mortgaged Properties. The Mortgaged Properties, and with --------------------------------- respect to Mortgaged Properties not operated by Mortgagor, to the best of Mortgagor’s 's knowledge, such non-operated Mortgaged Properties, (and properties unitized therewith) are being (and, to the extent the same could adversely affect the ownership or operation of the Mortgaged Properties after the date hereof, have in the past been), and hereafter will be, maintained, operated and developed in a good and workmanlike manner, in accordance with prudent industry standards and in conformity with all applicable laws and all rules, regulations and orders of all duly constituted authorities having jurisdiction and in conformity with all oil, gas and/or other mineral leases and other contracts and agreements forming a part of the Property and in conformity with the Permitted Encumbrances; specifically in this connection, (i) no Mortgaged Property is subject to having allowable production after the date hereof reduced below the full and regular allowable (including the maximum permissible tolerance) because of any overproduction (whether or not the same was permissible at the time) prior to the date hereof and (ii) none of the xxxxx wells located on the Mortgaged Properties (or properties unitized therewithunitizxx xherewith) are or will be deviated from the vertical more than the maximum permitted by applicable laws, regulations, rules and orders, and such xxxxx wells are, and will remain, bottomed under and producing from, with the wxxx xhe well bores wholly within, the Mortgaged Properties (or, in the case of xxxxx wells located on properties unitized therewith, such unitized propertiesunitixxx xroperties). There are no xxxxx wells listed on Schedule I hereto (“"Schedule I Xxxxx”Wells") being redrilledredrilxxx, deepened, plugged back or reworked, and no other xxxxr operations are being conducted for which consent is required under the applicable operating agreement (or which are other than normal operation of existing xxxxx wells on the Mortgaged Properties); except as otherwise disclosed to Agent xx Xxent in writing, there are no proposals in excess of $1,500,000 500,000 net to Mortgagor’s 's interest currently outstanding (whether made by Mortgagor or by any other party) to re-drill, deepen, plug back, or rework Schedule I XxxxxWells, or to conduct any other operations under the applicable joint xxxnt operating agreement, or to abandon any Schedule I Xxxxx Wells (nor are there any such proposals which have been approved either approvxx xxther by Mortgagor or any other party, with respect to which the operations covered thereby have not been commenced). Houston 3941837v.4 Except as otherwise disclosed to Agent in writing, there are no dry holes, or otherwise inactive xxxxxwells, located on the Mortgaged Properties or on lands pooled or unitized ox xxitized therewith (including, without limitation, any xxxxx wells which would, if located in Texas, require compliance with xxxx Railroad Commission Rule 14(b)(2)) that in the aggregate will cost more than $1,500,000500,000, net to Mortgagor’s 's interest and net of salvage proceeds, to plug and abandon, except for xxxxx wells that have been properly plugged and abandoned that have not been taken into account in Mortgagor’s financial statements as furnished to Agentabandoned. Mortgagor hashxx, and xnd will have in the future, all governmental licenses and permits necessary or appropriate to own and operate the Property; Mortgagor has not received notice of any violations in respect of any such licenses or permits.
Appears in 1 contract
Operation of Mortgaged Properties. The Mortgaged Properties, and with respect to Mortgaged Properties not operated by Mortgagor, to the best of Mortgagor’s knowledge, such non-operated Mortgaged Properties, (and properties unitized therewith) are being (and, to the extent the same could adversely affect the ownership or operation of the Mortgaged Properties after the date hereof, have in the past been), and hereafter will be, maintained, operated and developed in a good and workmanlike manner, in accordance with prudent industry standards and in conformity with all applicable laws and all rules, regulations and orders of all duly constituted authorities having jurisdiction and in conformity with all oil, gas and/or other mineral leases and other contracts and agreements forming a part of the Property and in conformity with the Permitted Encumbrances; specifically in this connection, (i) no Mortgaged Property is subject to having allowable production after the date hereof hereof, reduced below the full and regular allowable (including the maximum permissible tolerance) because of any overproduction (whether or not the same was permissible at the time) prior to the date hereof hereof, and (ii) none of the xxxxx located on the Mortgaged Properties (or properties unitized therewith) are or will be deviated from the vertical more than the maximum permitted by applicable laws, regulations, rules and orders, and such xxxxx are, and will remain, bottomed under and producing from, with the well bores wholly within, the Mortgaged Properties (or, in the case of xxxxx located on properties unitized therewith, such unitized properties). There are no xxxxx listed on Schedule I hereto (“Schedule I Xxxxx”) being redrilleddrilled, deepened, plugged back or reworked, and no other operations are being conducted for which consent is required under the applicable operating agreement (or which are other than normal operation of existing xxxxx on the Mortgaged Properties); except as otherwise disclosed to Agent in writing, there are no proposals in excess of $1,500,000 net to Mortgagor’s interest currently outstanding (whether made by Mortgagor or by any other party) to re-drill, deepen, plug back, or rework Schedule I Xxxxxxxxxx, or to conduct any such other operations under the applicable joint operating agreementoperations, or to abandon any Schedule I Xxxxx xxxxx on the Mortgaged Properties (nor are there any such proposals which have been approved approved, either by Mortgagor or any other party, with respect to which the operations covered thereby have not been commencedcommenced other than those disclosed by Mortgagor to Mortgagee in writing prior to the execution hereof). Houston 3941837v.4 Except as otherwise disclosed to Agent in writing, there There are no dry holes, or otherwise inactive xxxxx, located on the Mortgaged Properties or on lands pooled or unitized therewith (including, without limitation, any xxxxx which would, if located in Texas, require compliance with Railroad Commission Rule 14(b)(2)) that in the aggregate will cost more than $1,500,000, net to Mortgagor’s interest and net of salvage proceeds, to plug and abandon, except for xxxxx that have been properly plugged and abandoned that have not been taken into account in Mortgagor’s financial statements as furnished to Agentabandoned. Mortgagor has, and will have in the future, all governmental licenses and permits necessary or appropriate to own and operate the Property; and Mortgagor has not received notice of any violations in respect of any such licenses or permits.
Appears in 1 contract
Operation of Mortgaged Properties. The Whether or not the Grantor is ------------------------------------ the operator of the Mortgaged Properties, the Grantor shall, at the Grantor's sole expense:
(a) Perform, or cause to be performed, all covenants, terms and conditions imposed upon the Grantor or its predecessors in interest and expressly contained in such Oil and Gas Leases (including without limitation the payment of all delay rentals and other amounts necessary to keep the Oil and Gas Leases in full force and effect), or expressly contained in any assignments or farmouts, under or through which such Oil and Gas Leases or undivided interest therein are now held, and perform or cause to be performed all implied covenants and obligations imposed upon the Grantor or its predecessors in interest in connection with such Oil and Gas Leases, insofar as such Oil and Gas Leases cover the properties mortgaged hereby, except in those circumstances where (1) a reasonably prudent operator under similar circumstances and in accordance with customary industry practice would deem it prudent not to so perform such covenants or conditions, and (2) such non-performance individually or in the aggregate is not such as to interfere materially with the development, operation or value of the Mortgaged Properties;
(b) Keep, or cause to be kept, in full force and effect throughout their respective terms as provided therein, the Oil and Gas Leases, insofar as they cover properties mortgaged hereby, and not abandon any well or forfeit, surrender, release or permit to expire any Oil and Gas Lease or any rights in the Mortgaged Properties, or any part thereof, or permit any of the foregoing to occur, except in those circumstances where (1) a reasonably' prudent operator under similar circumstances in accordance with customary industry practice would deem it prudent to do so, arid (2) such actions individually or in the aggregate are not such as to interfere materially with the development, operation or value of the Mortgaged Properties; provided that the foregoing exception shall not -------- apply to any Oil and Gas Lease or part thereof that may be maintained in force by production of Hydrocarbons from existing xxxxx capable of producing in paying quantities, or by payment of delay rentals or shut-in royalties, and provided -------- further that Grantor shall under no circumstances be obligated to drill any well ------- to keep any Oil and Gas Lease in full force and effect;
(c) Operate, or cause to be operated, in a good workmanlike manner as would a prudent operator under similar circumstances and in accordance with all applicable federal, state and local laws, rules and regulations, the Mortgaged Properties, and with continuously operate or cause to be operated for the production of Hydrocarbons in a good workmanlike manner as would a prudent operator under similar circumstances the xxxxx now or hereafter drilled on the Mortgaged Properties;
(d) Pay, or cause to be paid, promptly as and when due and payable, all rentals and royalties payable in respect to of the Mortgaged Properties not operated by Mortgagor, to and Grantor's share of all costs and expenses incurred under any joint operating agreement affecting the best of Mortgagor’s knowledge, such non-operated Mortgaged Properties, (or any portion thereof, and properties unitized therewith) are being (and, in connection therewith furnish to the extent Holder, as and when requested, full information as to the same could status of any joint account maintained with others under any such operating agreement or other agreement constituting a part of the Mortgaged Properties;
(e) Cause the Operating Equipment to be maintained, preserved and kept in good and effective operating condition, and from time to time make or cause to be made all necessary and proper repairs, renewals, replacements, substitutions and improvements thereof or thereto necessary for the production of Hydrocarbons from the Mortgaged Properties to be promptly made;
(f) Cause the Mortgaged Properties to be kept free and clear of liens, charges and encumbrances of every character, other than (1) the lien hereof, (2) defects and irregularities in title, and liens, charges or encumbrances, which are not such as to interfere materially with the development, operation or value of the Mortgaged Properties and not such as to affect materially title thereto, (3) liens arising under standard operating agreements which are usual and customary in accordance with routine industry practice, (4) taxes constituting a lien but not due and payable, (5) those set forth or referred to in Exhibit A, (6) those arising from obligations being contested by the Grantor in good faith as permitted by Section 4.2(k) hereof, (7) those consented to in writing by the Holder, and (8) those arising in connection with workmen's compensation insurance, unemployment insurance or old age pension, or of mechanics and materialmen or operators for sums not due;
(g) Not agree to any amendment to the terms of any Oil and Gas Lease constituting part of the Mortgaged Properties, or of any assignment, farm-out, or other instrument that affects Grantor's title to the Mortgaged Properties;
(h) Not take any action to incur any liability or lien under any operating agreement, or enter into any new operating agreement or amend any existing operating agreement affecting the Mortgaged Properties;
(i) Not enter into, become bound by, or subject the Mortgaged Properties to, any contract or agreement, including without limitation contracts containing a "take or pay", "market-out' or "FERC-out" clause, which is burdensome on the Grantor or materially adversely affect affects the ownership or operation of the Mortgaged Properties after Properties;
(j) Use the date hereof, have Operating Equipment in the past been)business or Grantor, and, except where under the control of an operator other than the Grantor, keep same in Grantor's possession or control at all times at Grantor's risk of loss and hereafter will bekeep same on the Mortgaged Properties, maintainedexcept for its temporary removal in connection with its ordinary use in the ordinary course of business unless Grantor notifies the Holder in writing and the Holder consents in writing in advance of its removal to another location;
(k) Duly pay and discharge, operated or cause to be duly paid and developed dis-charged, (1) before delinquent all gross ad valorem taxes, production taxes, severance taxes, occupation taxes, windfall profit taxes, or other charges of every kind and character whatsoever in respect of the Mortgaged Properties, or any portion thereof, or incident to or in connection with the operation or development of the Grantor's interests in the Mortgaged Properties or the production of Hydrocarbons and other minerals therefrom, as well as all federal and state income taxes payable generally by the Grantor regardless of their relation to the Mortgaged Properties; (2) all lawful claims in respect of the Mortgaged Properties, whether for labor, materials, supplies, services or anything else, which might or could, if unpaid, become a good lien or charge upon the Mortgaged Properties; and workmanlike manner, (3) all trade bills when due in accordance with prudent customary industry standards practice and in conformity such manner so that the Mortgaged Properties, business, assets, condition (financial or otherwise) and the credit standing of the Grantor are not materially and adversely affected; provided that the Grantor ------------- shall not be required to pay or cause to be paid such taxes, charges, assessments, claims or trade bills if the payment thereof is being contested in good faith by appropriate proceedings with all applicable laws adequate reserves with respect thereto, determined in accordance with generally accepted accounting principles, having been set aside on the Grantor's books. In the event the Grantor shall fail or neglect to pay or cause to be paid any charges of any nature, except with respect to charges not then due, which may or might become superior or pari passu to the lien created by this Deed of Trust, the Holder at its option may pay or cause to be paid such charges or any part thereof, and the Grantor will promptly reimburse the Holder therefor, and any and all rules, regulations sums so paid hereunder shall be reimbursed by the Grantor to the Holder upon demand and orders of all duly constituted authorities having jurisdiction and in conformity with all oil, gas and/or other mineral leases and other contracts and agreements forming stall constitute a part of the Property and in conformity with Secured Indebtedness. In the Permitted Encumbrances; specifically in this connection, (i) no Mortgaged Property is subject to having allowable production after event the date hereof reduced below the full and regular allowable (including the maximum permissible tolerance) because payment of any overproduction (whether or not charges of any nature herein described is contested for any reason whatsoever, the same was permissible at Grantor will, if requested by the time) prior Holder, provide the Holder with a bond in an amount and with surety satisfactory to the date hereof Holder to protect the Holder against any and all coats, losses, damages or liabilities in connection with contesting such charge;
(iil) none File and deliver, or cause to be filed and delivered, all necessary reports, notices, petitions and certificates and obtain all necessary regulatory approvals to authorize any operation conducted on the Mortgaged Properties, the sale of production therefrom, and the xxxxx located collection of prices charged therefor;
(m) Permit the Holder and its agents, representatives, independent accountants, attorneys and employees, at all times, to go upon, examine, inspect, test and remain on the Mortgaged Properties (or properties unitized therewith) are or will be deviated from the vertical more than the maximum permitted by applicable lawsand any parts thereof, regulations, rules including its books of account and ordersother hooks and records, and such xxxxx areto strap, gauge, measure and will remain, bottomed under inspect any and producing from, with the well bores wholly within, the Mortgaged Properties (or, in the case of xxxxx located on properties unitized therewith, such unitized properties). There are no xxxxx listed on Schedule I hereto (“Schedule I Xxxxx”) being redrilled, deepened, plugged back or reworked, and no other operations are being conducted for which consent is required under the applicable operating agreement (or which are other than normal operation of existing xxxxx on the Mortgaged Properties); except as otherwise disclosed to Agent in writing, there are no proposals in excess of $1,500,000 net to Mortgagor’s interest currently outstanding (whether made by Mortgagor or by all tanks at any other party) to re-drill, deepen, plug back, or rework Schedule I Xxxxx, or to conduct any other operations under the applicable joint operating agreement, or to abandon any Schedule I Xxxxx (nor are there any such proposals which have been approved either by Mortgagor or any other party, with respect to which the operations covered thereby have not been commenced). Houston 3941837v.4 Except as otherwise disclosed to Agent in writing, there are no dry holes, or otherwise inactive xxxxx, located time on the Mortgaged Properties or on lands pooled holding Hydrocarbons or unitized therewith other minerals therefrom, and Grantor will furnish the Holder, upon request, all pertinent information in regard to the development and operation and value of the Mortgaged Properties as well as any other information which the Holder may from time to time request concerning any matter in connection with the Grantor's business or operations; and
(n) Comply with and perform, or cause to be complied with and performed, all applicable laws, rules and regulations of the United States and every other governmental body having jurisdiction with respect to the operation and development of the Mortgaged Properties and the production and sale of Hydrocarbons or other minerals therefrom. As to any part of the Mortgaged Properties which is not a working interest, Grantor agrees to take all such reasonable action and to exercise all rights and remedies as are available to Grantor to cause the owner or owners of the working interest in such properties to comply with the covenants and agreements contained herein; and as to any part of the Mortgaged Properties which is a working interest but which is operated by a party other than Grantor, Grantor agrees to take all such reasonable action and to exercise all rights and remedies as are available to Grantor (including, without limitationbut not limited to, all rights under any xxxxx which would, if located in Texas, require compliance operating agreement) to cause the party who is the operator of such property to comply with Railroad Commission Rule 14(b)(2)) that in the aggregate covenants and agreements contained herein. Grantor will cost more than $1,500,000, net immediately notify the Holder of any failure of the operator of any of the Mortgaged Properties to Mortgagor’s interest and net of salvage proceeds, to plug and abandon, except for xxxxx that have been properly plugged and abandoned that have not been taken into account in Mortgagor’s financial statements as furnished to Agent. Mortgagor hasperform any such obligation, and in cooperation with the Holder, will have in the futuretake such steps as may be expedient to secure compliance therewith, all governmental licenses and permits necessary or appropriate to own and operate the Property; Mortgagor has not received notice obtain appointment of any violations in respect of any such licenses or permitsa different operator.
Appears in 1 contract
Operation of Mortgaged Properties. The Mortgaged Properties, and with respect to Mortgaged Properties not operated by Mortgagor, to the best of Mortgagor’s knowledge, such non-operated Mortgaged Properties, (and properties unitized therewith) are being (and, to the extent the same could adversely affect the ownership or operation of the Mortgaged Properties after the date hereof, have in the past been), and hereafter will be, maintained, operated and developed in a good and workmanlike manner, in accordance with prudent industry standards and in conformity with all applicable laws and all rules, regulations and orders of all duly constituted authorities having jurisdiction and in conformity with all oil, gas and/or other mineral leases and other contracts and agreements forming a part of the Property and in conformity with the Permitted Encumbrances, except for such failures as could not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the Mortgaged Properties; specifically in this connection, (i) no Mortgaged Property is subject to having allowable production after the date hereof reduced below the full and regular allowable (including the maximum permissible tolerance) because of any overproduction (whether or not the same was permissible at the time) prior to the date hereof and (ii) none of the xxxxx wxxxx located on the Mortgaged Properties (or properties unitized therewith) are or will be deviated from the vertical more than the maximum permitted by applicable laws, regulations, rules and orders, and such xxxxx wxxxx are, and will remain, bottomed under and producing from, with the well bores wholly within, the Mortgaged Properties (or, in the case of xxxxx wxxxx located on properties unitized therewith, such unitized properties). There are no xxxxx listed on Schedule I hereto (“Schedule I Xxxxx”) wxxxx being redrilleddrilled, deepened, plugged back or reworked, and no other operations are being conducted for which consent is required under the applicable operating agreement (or which are other than normal operation of existing xxxxx wxxxx on the Mortgaged Properties); except as otherwise disclosed to Agent in writing, there are no proposals in excess of $1,500,000 net to Mortgagor’s interest currently outstanding (whether made by Mortgagor or by any other party) to re-drill, deepen, plug back, or rework Schedule I Xxxxxwxxxx, or to conduct any such other operations under the applicable joint operating agreementoperations, or to abandon any Schedule I Xxxxx wxxxx on the Mortgaged Properties (nor are there any such proposals which have been approved either by Mortgagor or any other party, with respect to which the operations covered thereby have not been commenced). Houston 3941837v.4 Except as otherwise disclosed to Agent in writing, there are no dry holes, or otherwise inactive xxxxx, located on the Mortgaged Properties or on lands pooled or unitized therewith (including, without limitation, any xxxxx which would, if located in Texas, require compliance with Railroad Commission Rule 14(b)(2)) that in the aggregate will cost more than $1,500,000, net to Mortgagor’s interest and net of salvage proceeds, to plug and abandon, except for xxxxx that have been properly plugged and abandoned that have not been taken into account in Mortgagor’s financial statements as furnished to Agent. Mortgagor has, and will have in the future, all governmental licenses and permits necessary or appropriate to own and operate the Property; and Mortgagor has not received notice of any violations in respect of any such licenses or permits.
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Operation of Mortgaged Properties. The Mortgaged Properties, and with respect to Mortgaged Properties not operated by Mortgagor, to the best of Mortgagor’s knowledge, such non-operated Mortgaged Properties, (and properties unitized therewith) are being (and, to the extent the same could adversely affect the ownership or operation of the Mortgaged Properties after the date hereof, have in the past been), and hereafter will be, maintained, operated and developed in a good and workmanlike manner, in accordance with prudent industry standards and in conformity with all applicable laws and all rules, regulations and orders of all duly constituted authorities having jurisdiction and in conformity with all oil, gas and/or other mineral leases and other contracts and agreements forming a part of the Property and in conformity with the Permitted Encumbrances; specifically in this connection, (i) no Mortgaged Property is subject to having allowable production after the date hereof reduced below the full and regular allowable (including the maximum permissible tolerance) because of any overproduction (whether or not the same was permissible at the time) prior to the date hereof and (ii) none of the xxxxx located welxx xxcated on the Mortgaged Properties (or properties unitized therewith) are or will be deviated from the vertical more than the maximum permitted by applicable laws, regulations, rules and orders, and such xxxxx arewelxx xxe, and will remain, bottomed under and producing from, with the well bores wholly within, the Mortgaged Properties (or, in the case of xxxxx welxx located on properties unitized therewith, such unitized properties). There are no xxxxx listed on Schedule I hereto (“Schedule I Xxxxx”) being redrilledwelxx xxing drilled, deepened, plugged back or reworked, and no other operations are being conducted for which consent is required under the applicable operating agreement (or which are other than normal operation of existing xxxxx on welxx xx the Mortgaged Properties); except as otherwise disclosed to Agent in writing, there are no proposals in excess of $1,500,000 net to Mortgagor’s interest currently outstanding (whether made by Mortgagor or by any other party) to re-drill, deepen, plug back, or rework Schedule I Xxxxxwelxx, or xr to conduct any such other operations under the applicable joint operating agreementoperations, or to abandon any Schedule I Xxxxx welxx xx the Mortgaged Properties (nor are there any such proposals which have been approved either by Mortgagor or any other party, with respect to which the operations covered thereby have not been commenced). Houston 3941837v.4 Except as otherwise disclosed to Agent in writing, there There are no dry holes, or otherwise inactive xxxxxwelxx, located xocated on the Mortgaged Properties or on lands pooled or unitized therewith (including, without limitation, any xxxxx which welxx xxich would, if located in Texas, require compliance with Railroad Commission Rule 14(b)(2)) that in the aggregate will cost more than $1,500,000, net to Mortgagor’s interest and net of salvage proceeds, to plug and abandon), except for xxxxx welxx that have been properly plugged and abandoned that have not been taken into account in Mortgagor’s financial statements as furnished to Agentabandoned. Mortgagor has, and will have in the future, all governmental licenses and permits necessary or appropriate to own and operate the Property; Mortgagor has not received notice of any violations in respect of any such licenses or permits.
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