Common use of Purchasers of Hydrocarbons Clause in Contracts

Purchasers of Hydrocarbons. (a) If Administrative Agent notifies Borrower that any Purchaser of Hydrocarbons is, in Administrative Agent’s reasonable judgment, not creditworthy, Borrower shall, to the extent that Borrower is the Operator, or to the extent Borrower is not the Operator Cause any Operator to, require the Purchaser to secure, to the satisfaction of Administrative Agent, the Purchaser’s obligations in respect of its purchase of Hydrocarbons attributable to the Properties. If the Purchaser refuses to secure its obligations, then Borrower shall, subject to any existing marketing arrangement with that Purchaser that is binding on Borrower and that is not terminable without penalty, (i) immediately cease selling Hydrocarbons to that Purchaser, or (ii) exercise its right to take the Hydrocarbons in kind and sell those Hydrocarbons to Purchasers Approved by Administrative Agent unless Borrower owns less than a 10% Working Interest in the subject Property and the Operator has acknowledged a notice of assignment of proceeds, then Borrower need not take the actions set forth in this Section 5.13(a). (b) Borrower shall give Administrative Agent at least 30 days prior written notice if Borrower proposes to sell, or, if Borrower is not the Operator, within 5 Business Days of receiving notice that the Operator proposes to sell or has sold, any Hydrocarbons to any additional or replacement Purchaser. The notice must (i) contain the proposed Purchaser’s complete name, address, telephone number, facsimile number and contact person, and (ii) identify the Properties to which the purchases relate.

Purchasers of Hydrocarbons. (a) If Administrative Agent notifies Borrower that any Purchaser of Hydrocarbons is, in Administrative Agent’s the Lenders’ reasonable judgment, not creditworthy, Borrower shall, to the extent that Borrower is the Operator, or to the extent Borrower is not the Operator Cause any Operator to, require the Purchaser to secure, to the satisfaction of Administrative Agentthe Lenders, the Purchaser’s obligations in respect of its purchase of Hydrocarbons attributable to the Properties. If the Purchaser refuses to secure its obligations, then Borrower shall, subject to any existing marketing arrangement with that Purchaser that is binding on Borrower and that is not terminable without penalty, (i) immediately cease selling Hydrocarbons to that Purchaser, or (ii) exercise its right to take the Hydrocarbons in kind and sell those Hydrocarbons to Purchasers Approved by Administrative Agent the Lenders unless Borrower owns less than a 10% Working Interest in the subject Property and the Operator has acknowledged a notice of assignment of proceeds, then Borrower need not take the actions set forth in this Section 5.13(a). (b) Borrower shall give Administrative Agent at least 30 days prior written notice if Borrower proposes to sell, or, if Borrower is not the Operator, within 5 Business Days of receiving notice that the Operator proposes to sell or has sold, any Hydrocarbons to any additional or replacement Purchaser. The notice must (i) contain the proposed Purchaser’s complete name, address, telephone number, facsimile number and contact person, and (ii) identify the Properties to which the purchases relate.