CREDIT AGREEMENT dated as of April 9, 2019 among SAMSON OIL AND GAS USA, INC., as Borrower THE LENDERS FROM TIME TO TIME PARTY HERETO and AEP I FINCO LLC, as Administrative Agent

Exhibit 10.1

[Execution Version]

CREDIT AGREEMENT

dated as of April 9, 2019

among

SAMSON OIL AND GAS USA, INC.,

as Borrower

THE LENDERS FROM TIME TO TIME PARTY HERETO

and

AEP I XXXXX LLC,

as Administrative Agent

TABLE OF CONTENTS

		Page

ARTICLE I DEFINITIONS; CONSTRUCTION		1
Section 1.1.	Definitions	1
Section 1.2.	Classifications of Loans and Borrowings	30
Section 1.3.	Accounting Terms and Determination	30
Section 1.4.	Terms Generally	31

ARTICLE II AMOUNT AND TERMS OF THE COMMITMENTS		31
Section 2.1.	General Description of Facility; Termination of Commitments	31
Section 2.2.	Loans	31
Section 2.3.	Acquisition and Development Plan	31
Section 2.4.	Procedure for Borrowing	31
Section 2.5.	Reserved	32
Section 2.6.	Reserved	32
Section 2.7.	Reserved	32
Section 2.8.	Repayment of Loans	32
Section 2.9.	Cash Management Prior to an Event of Default	32
Section 2.10.	Cash Management After an Event of Default	32
Section 2.11.	Evidence of Indebtedness	34
Section 2.12.	Optional Prepayments	34
Section 2.13.	Mandatory Prepayments	35
Section 2.14.	Interest on Loans	35
Section 2.15.	Fees. The Borrower shall pay to the Administrative Agent for its own account fees in the amounts and at the times previously agreed upon in writing by the Borrower and the Administrative Agent	36
Section 2.16.	Computation of Interest and Fees	36
Section 2.17.	Inability to Determine Interest Rates	36
Section 2.18.	Illegality	36
Section 2.19.	Increased Costs	37
Section 2.20.	Funding Indemnity	38
Section 2.21.	Taxes	38
Section 2.22.	Payments Generally; Pro Rata Treatment; Sharing of Set-offs	42
Section 2.23.	Mitigation of Obligations	43
Section 2.24.	Defaulting Lenders	43

ARTICLE III CONDITIONS PRECEDENT TO LOANS		44
Section 3.1.	Conditions to Effectiveness	44
Section 3.2.	Conditions to Closing Date Borrowing	48
Section 3.3.	Delivery of Documents	49

ARTICLE IV REPRESENTATIONS AND WARRANTIES		49
Section 4.1.	Existence; Power	49
Section 4.2.	Organizational Power; Authorization	49
Section 4.3.	Governmental Approvals; No Conflicts	49
Section 4.4.	Financial Statements	50
Section 4.5.	Litigation and Environmental Matters	50

Section 4.6.	Compliance with Laws and Agreements	51
Section 4.7.	Investment Company Act	51
Section 4.8.	Taxes	52
Section 4.9.	Margin Regulations	52
Section 4.10.	ERISA	52
Section 4.11.	Ownership of Property; Insurance	53
Section 4.12.	Disclosure	54
Section 4.13.	Labor Relations	54
Section 4.14.	Subsidiaries	55
Section 4.15.	Solvency	55
Section 4.16.	Deposit and Disbursement Accounts	55
Section 4.17.	Collateral Documents	55
Section 4.18.	Restriction on Liens	55
Section 4.19.	Material Agreements	56
Section 4.20.	OFAC; Foreign Corrupt Practices Act	56
Section 4.21.	Patriot Act	56
Section 4.22.	Gas Imbalances; Prepayments	56
Section 4.23.	Marketing of Production	56
Section 4.24.	Hedging Transactions and Qualified ECP Guarantor	57
Section 4.25.	EEA Financial Institutions	57
Section 4.26.	Delay Payments	57

ARTICLE V AFFIRMATIVE COVENANTS		57
Section 5.1.	Financial Statements and Other Information	57
Section 5.2.	Notices of Material Events	59
Section 5.3.	Existence; Conduct of Business	60
Section 5.4.	Compliance with Laws	60
Section 5.5.	Payment of Obligations	61
Section 5.6.	Books and Records	61
Section 5.7.	Visitation and Inspection	61
Section 5.8.	Maintenance of Properties; Insurance	61
Section 5.9.	Use of Proceeds; Margin Regulations	62
Section 5.10.	Events of Loss	63
Section 5.11.	Cash Management	63
Section 5.12.	Additional Subsidiaries and Collateral	63
Section 5.13.	Reserve Reports	64
Section 5.14.	Title Information	65
Section 5.15.	Mortgaged Property	66
Section 5.16.	Further Assurances	66
Section 5.17.	Environmental Matters	66
Section 5.18.	Offtake Agreement	67
Section 5.19.	Hedging Transactions	67
Section 5.20.	Lockbox Account	67
Section 5.21.	Commodity Exchange Act Keepwell Provisions	67
Section 5.22.	Board Observer	68
Section 5.23.	Required Capital Reserve Amount	68
Section 5.24.	Required Debt Service Reserve Amount	68
Section 5.25.	Post-Closing Covenants	68

ARTICLE VI FINANCIAL COVENANTS		69
Section 6.1.	Leverage Ratio	69

Section 6.2.	Current Ratio	69
Section 6.3.	Asset Coverage Ratio	70
Section 6.4.	Asset Coverage Ratio (PDP)	70
Section 6.5.	Fixed Charge Coverage Ratio	70
Section 6.6.	Capital Expenditures	70

ARTICLE VII NEGATIVE COVENANTS		70
Section 7.1.	Indebtedness and Preferred Equity	70
Section 7.2.	Liens	71
Section 7.3.	Fundamental Changes	71
Section 7.4.	Investments, Loans	72
Section 7.5.	Restricted Payments	73
Section 7.6.	Sale of Properties; Termination of Hedging Transactions	73
Section 7.7.	Transactions with Affiliates	75
Section 7.8.	Restrictive Agreements	75
Section 7.9.	Sale and Leaseback Transactions	76
Section 7.10.	Hedging Transactions	76
Section 7.11.	Amendment to Material Documents	77
Section 7.12.	Sale or Discount of Receivables	77
Section 7.13.	Accounting Changes	77
Section 7.14.	Lease Obligations	77
Section 7.15.	Government Regulation	77
Section 7.16.	Gas Imbalances, Take-or-Pay or Other Prepayments	78
Section 7.17.	Marketing Activities	78
Section 7.18.	Non-Qualified ECP Guarantors	78
Section 7.19.	Environmental Matters	78
Section 7.20.	Sanctions and Anti-Corruption Laws	78
Section 7.21.	G&A Expenses	78

ARTICLE VIII EVENTS OF DEFAULT		79
Section 8.1.	Events of Default	79
Section 8.2.	Application of Proceeds from Collateral	81

ARTICLE IX THE ADMINISTRATIVE AGENT and the Collateral Agent		82
Section 9.1.	Appointment of the Administrative Agent and the Collateral Agent	82
Section 9.2.	Nature of Duties of the Administrative Agent	83
Section 9.3.	Lack of Reliance on the Administrative Agent	84
Section 9.4.	Certain Rights of the Administrative Agent	84
Section 9.5.	Reliance by the Administrative Agent	84
Section 9.6.	The Administrative Agent in its Individual Capacity	84
Section 9.7.	Successor Administrative Agent.	84
Section 9.8.	Withholding Tax	85
Section 9.9.	The Administrative Agent May File Proofs of Claim	85
Section 9.10.	Authorization to Execute Other Loan Documents	86
Section 9.11.	Collateral and Guaranty Matters	86
Section 9.12.	Right to Realize on Collateral and Enforce Guarantee	86
Section 9.13.	Reserved	87
Section 9.14.	Authority to Release Guarantors, Collateral and Liens	87

iii

ARTICLE X MISCELLANEOUS		87
Section 10.1.	Notices	87
Section 10.2.	Waiver; Amendments	89
Section 10.3.	Expenses; Indemnification	90
Section 10.4.	Successors and Assigns	92
Section 10.5.	Governing Law; Jurisdiction; Consent to Service of Process	94
Section 10.6.	WAIVER OF JURY TRIAL	95
Section 10.7.	Right of Set-off	96
Section 10.8.	Counterparts; Integration	96
Section 10.9.	Survival	96
Section 10.10.	Severability	96
Section 10.11.	Confidentiality	97
Section 10.12.	Interest Rate Limitation	97
Section 10.13.	Waiver of Effect of Corporate Seal	97
Section 10.14.	Patriot Act	98
Section 10.15.	No Advisory or Fiduciary Responsibility	98
Section 10.16.	Acknowledgment and Consent to Bail-In of EEA Financial Institutions	98
Section 10.17.	Collateral Matters; Hedge Agreements	99
Section 10.18.	INTERCREDITOR AGREEMENTS	99

Schedules

Schedule I	-	Maximum Loan Amounts
Schedule II	-	Federal and State Lease Filings
Schedule 2.3	-	Initial Acquisition and Development Plan
Schedule 4.5	-	Environmental Matters
Schedule 4.11	-	Insurance
Schedule 4.14	-	Subsidiaries
Schedule 4.16	-	Deposit and Disbursement Accounts
Schedule 4.19	-	Material Agreements
Schedule 4.22	-	Gas Imbalances; Prepayments
Schedule 4.23	-	Marketing of Production
Schedule 4.24	-	Hedging Transactions
Schedule 7.7	-	Affiliated Transactions

Exhibits

Exhibit A	-	Form of Assignment and Acceptance
Exhibit B	-	Form of Promissory Note
Exhibit C	-	Form of Guaranty Agreement
Exhibit 2.4	-	Form of Notice of Borrowing
Exhibit 2.20	-	Tax Certificates
Exhibit 5.1(c)	-	Form of Compliance Certificate

CREDIT AGREEMENT

THIS CREDIT AGREEMENT (this “Agreement”) is made and entered into as of April 9, 2019, by and among SAMSON OIL AND GAS USA, INC., a Colorado corporation (the “Borrower”), the several banks and other financial institutions and lenders from time to time party hereto (the “Lenders”), and AEP I XXXXX LLC, a Delaware limited liability company, in its capacity as administrative agent for the Lenders (the “Administrative Agent”) and collateral agent for the Secured Parties (the “Collateral Agent”).

WITNESETH:

WHEREAS, the Borrower has requested that the Lenders establish a $33,500,000 term loan facility in favor of the Borrower; and

WHEREAS, subject to the terms and conditions of this Agreement, the Lenders, to the extent of their respective Commitments as defined herein, are willing severally to establish the requested term loan facility in favor of the Borrower;

NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained, the Borrower, the Lenders and the Administrative Agent agree as follows:

ARTICLE I

DEFINITIONS; CONSTRUCTION

Section 1.1. Definitions. In addition to the other terms defined herein, the following terms used herein shall have the meanings herein specified (to be equally applicable to both the singular and plural forms of the terms defined):

“Acquisition” shall mean (a) any Investment by the Borrower or any of its Subsidiaries in any other Person organized in the United States (with substantially all of the assets of such Person and its Subsidiaries located in the United States), pursuant to which such Person shall become a Subsidiary of the Borrower or any of its Subsidiaries or shall be merged with the Borrower or any of its Subsidiaries or (b) any acquisition by the Borrower or any of its Subsidiaries of the assets of any Person (other than a Subsidiary of the Borrower) that constitute all or substantially all of the assets of such Person or a division or business unit of such Person, whether through purchase, merger or other business combination or transaction (and substantially all of such assets, division or business unit are located in the United States). With respect to a determination of the amount of an Acquisition, such amount shall include all consideration (including any deferred payments) set forth in the applicable agreements governing such Acquisition as well as the assumption of any Indebtedness in connection therewith.

“Acquisition and Development Plan” shall mean the comprehensive plan or plans in effect from time to time with respect to the acquisition and development of the Mortgaged Properties, including, without limitation, the Initial Acquisition and Development Plan and the Updated Acquisition and Development Plan, detailing for a twelve-month period, all capital expenditures in connection with the acquisition and development of such Mortgaged Properties and any other expenditures that have been Approved by the Majority Lenders. An Acquisition and Development Plan shall provide for, among other things, (a) the location, timing and estimated costs of (i) all acquisitions and lease extensions, (ii) Xxxxx to be drilled, completed or recompleted or reworked and (iii) base capital, for which all or any part of the proceeds of the Loans are being utilized, (b) the description, timing and estimated costs of all capital expenditure development projects (including the performance of seismic explorations) proposed on the Mortgaged Properties using all or any part of the proceeds of any Loans, (c) the establishment of the Reserve Account and subsequent maintenance thereof along with the Required Capital Reserve Amount and the Required Debt Service Reserve Amount, and (d) the Approved Budget.

“Adjusted LIBO Rate” shall mean, with respect to each Interest Period for a Eurodollar Loan, (i) the rate per annum equal to the London interbank offered rate for deposits in U.S. Dollars appearing on Reuters screen page LIBOR 01 (or on any successor or substitute page of such service or any successor to such service, or such other commercially available source providing such quotations as may be designated by the Administrative Agent from time to time) at approximately 11:00 A.M. (London time) two (2) Business Days prior to the first day of such Interest Period, with a maturity comparable to such Interest Period (provided that if such rate is less than zero, such rate shall be deemed to be zero), divided by (ii) a percentage equal to 1.00% minus the then stated maximum rate of all reserve requirements (including any marginal, emergency, supplemental, special or other reserves and without benefit of credits for proration, exceptions or offsets that may be available from time to time) applicable to any member bank of the Federal Reserve System in respect of Eurocurrency liabilities as defined in Regulation D (or any successor category of liabilities under Regulation D); provided, that if the rate referred to in clause (i) above is not available at any such time for any reason, then the rate referred to in clause (i) shall instead be the interest rate per annum, as reasonably determined by the Administrative Agent, to be the arithmetic average of the rates per annum at which deposits in U.S. Dollars in an amount equal to the amount of such Eurodollar Loan are offered by major banks in the London interbank market to the Administrative Agent at approximately 11:00 A.M. (London time), two (2) Business Days prior to the first day of such Interest Period with a term equivalent to such Interest Period. For purposes of this Agreement, the Adjusted LIBO Rate will not be less than one and three-quarters percent (1.75%).

“Administrative Agent” shall have the meaning set forth in the introductory paragraph hereof.

“Administrative Questionnaire” shall mean, with respect to each Lender, an administrative questionnaire in the form provided by the Administrative Agent and submitted to the Administrative Agent duly completed by such Lender.

“AFE” shall mean an authorization for expenditure representing an estimate of work to be performed for a specific drilling, completion or other operation.

“Affiliate” shall mean, as to any Person, any other Person that directly, or indirectly through one or more intermediaries, Controls, is Controlled by, or is under common Control with, such Person. For the purposes of this definition, “Control” shall mean the power, directly or indirectly, either to direct or cause the direction of the management and policies of a Person, whether through the ability to exercise voting power, by control or otherwise; provided that, without limiting the generality of the foregoing, any Person that owns directly or indirectly more than 50% of Capital Stock having ordinary voting power for the election of the directors or other governing body of a Person (other than as a limited partner of such other Person) will be deemed to “Control” such other Person. The terms “Controlled by” and “under common Control with” have the meanings correlative thereto.

“Aggregate Commitment Amount” shall mean the aggregate principal amount of the Aggregate Commitments.

“Aggregate Commitments” shall mean, collectively, all Commitments of all Lenders outstanding on the Closing Date immediately prior to the making of the initial Borrowing on the Closing Date.

“Aggregate Maximum Loan Amount” shall mean the Aggregate Maximum Loan Amount as set forth on Schedule I.

“Agreed Pricing” shall mean:

(a) for anticipated sales of Hydrocarbons that are fixed in a firm fixed price sales contract with an Approved Counterparty, the fixed price or prices provided for in such sales contract during the term thereof;

(b) for anticipated sales of Hydrocarbons that are hedged by a fixed price Hedging Transaction with an Approved Counterparty, the fixed price or prices provided for in such Hedging Transaction during the term thereof, as modified by any necessary adjustment specified by the Administrative Agent for quality and geographical differentials; and

(c) for all other anticipated sales of Hydrocarbons, the then current average NYMEX 5-Year Strip price for the applicable Hydrocarbon.

“Anti-Corruption Laws” shall mean all laws, rules and regulations of any jurisdiction applicable to any Person concerning or relating to bribery or corruption.

“Anti-Terrorism Order” shall mean Executive Order 13224, signed by President Xxxxxx X. Xxxx on September 24, 2001.

“Applicable Lending Office” shall mean, for each Lender and for each Type of Loan, the “Lending Office” of such Lender (or an Affiliate of such Lender) designated for such Type of Loan in the Administrative Questionnaire submitted by such Lender or such other office of such Lender (or such Affiliate of such Lender) as such Lender may from time to time specify to the Administrative Agent and the Borrower as the office by which its Loans of such Type are to be made and maintained.

“Applicable Margin” shall mean, as of any date, with respect to interest on all Loans outstanding on such date, as the case may be, a percentage per annum equal to (a) for Eurodollar Loans, 10.5% and (b) for Base Rate Loans, 9.5%.

“Approval” and “Consent” shall mean, with respect to any consent or approval sought by Borrower and given by Administrative Agent or any Lender, the writings (which may be by facsimile or electronic mail) by Administrative Agent or Lenders that (a) authorize Borrower to take the action for which the consent or approval is sought and (b) set forth the conditions, if any, upon which the consent or approval is given by Administrative Agent or such Lender. “Approve” and “Approved” have the correlative meaning.

“Approved Budget” shall mean any budget for the Borrower and its Subsidiaries for the current Fiscal Year delivered pursuant to Section 5.1(g) which has the Approval of the Administrative Agent in its sole discretion.

“Approved Counterparty” shall mean (a) BP Energy Company, (b) any Person whose (or guarantor of such Person whose) long term senior unsecured debt rating at the time a particular swap agreement transaction is entered into is A- or A2 by S&P or Xxxxx’x (or their equivalent), respectively, or higher or (c) any other Person agreed by the Administrative Agent or the Majority Lenders.

“Approved Fund” shall mean any Person (other than a natural Person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business and that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

“Approved Petroleum Engineers” shall mean (a) Netherland Xxxxxx & Associates, Inc., Xxxxxx, Xxxxxxxxx & Associates, Inc., and Xxxxx Xxxxx Company, and (b) any other independent petroleum engineers reasonably acceptable to the Administrative Agent.

“Asset Coverage Ratio” shall mean, on the date of any determination, the ratio of (a) the Modified Proved NPV to (b) Consolidated Total Debt.

“Asset Coverage Ratio (PDP)” shall mean, on the date of any determination, the ratio of (a) the Modified Proved NPV for PDP reserves to (b) Consolidated Total Debt.

“Asset Coverage Ratio Test Date” shall mean the last day of each Fiscal Quarter and the date of each Interim Asset Coverage Ratio Test Date, beginning with the Fiscal Quarter ending June 30, 2019.

“Asset Sale” shall have the meaning set forth in Section 7.6.

“Assignment and Acceptance” shall mean an assignment and acceptance entered into by a Lender and an assignee (with the consent of any party whose consent is required by Section 10.4(b)) and accepted by the Administrative Agent, in the form of Exhibit A attached hereto or any other form approved by the Administrative Agent.

“Bail-In Action” shall mean the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

“Bail-In Legislation” shall mean, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.

“Base Rate” shall for any day a rate per annum equal to the highest of (i) the rate of interest which is published in the Wall Street Journal from time to time as the prime lending rate, as in effect from time to time (the “Prime Rate”), (ii) the Federal Funds Rate, as in effect from time to time, plus 0.50% per annum, (iii) the Adjusted LIBO Rate determined on a daily basis for an Interest Period of one (1) month, plus 1.00% per annum (any changes in such rates to be effective as of the date of any change in such rate), and (iv) zero percent (0.00%) per annum. The Wall Street Journal’s prime lending rate is a reference rate and does not necessarily represent the lowest or best rate actually charged to any customer. The Administrative Agent may make commercial loans or other loans at rates of interest at, above, or below the Wall Street Journal’s prime lending rate. Any change in the Base Rate due to a change in the Wall Street Journal’s prime rate, the Federal Funds Rate, or the Adjusted LIBO Rate will be effective from and including the effective date of such change in the Wall Street Journal’s prime rate, the Federal Funds Rate, or the Adjusted LIBO Rate, as applicable.

“Board Observer” shall have the meaning set forth in Section 5.22.

“Borrower” shall have the meaning set forth in the introductory paragraph hereof.

“Borrowing” shall mean a borrowing consisting of Loans of the same Type made, converted or continued on the same date and, in the case of Eurodollar Loans, as to which a single Interest Period is in effect.

“Business Day” shall mean any day other than (i) a Saturday, Sunday or other day on which commercial banks in New York are authorized or required by law to close and (ii) if such day relates to a Borrowing of, a payment or prepayment of principal or interest on, a conversion of or into, or an Interest Period for, a Eurodollar Loan or a notice with respect to any of the foregoing, any day on which banks are not open for dealings in Dollar deposits in the London interbank market.

“Capital Expenditures” shall mean, in respect of any Person, for any period, the aggregate (determined without duplication) of all expenditures and costs during the applicable period that are required to be included as additions during such period to Oil and Gas Properties and property, plant or equipment reflected in the consolidated balance sheet of the Loan Party in accordance with GAAP; provided, however, that Capital Expenditures for the Loan Party shall not include:

(a) expenditures to the extent they are made with proceeds of the issuance of Capital Stock of the Borrower;

(b) expenditures to the extent they are made with proceeds of insurance settlements, condemnation awards and other settlements in respect of lost, destroyed, damaged or condemned assets, equipment or other property to the extent such expenditures are made to replace or repair such lost, destroyed, damaged or condemned assets, equipment or other property or otherwise to acquire, maintain, develop, construct, improve, upgrade or repair assets or properties useful in the business of the Loan Party within twelve (12) months of receipt of such proceeds (or, if not made within such period of twelve (12) months, are committed to be made during such period);

(c) expenditures that are accounted for as capital expenditures of such person and that actually are paid for by a third party (excluding the Borrower or any Subsidiary thereof) and for which neither the Borrower nor any Subsidiary has provided or is required to provide or incur, directly or indirectly, any consideration or obligation to such third party or any other person (whether before, during or after such period); and

(d) the purchase price of equipment purchased during such period to the extent the consideration therefor consists of any combination of (i) used or surplus equipment traded in at the time of such purchase and (ii) the proceeds of a concurrent sale of used or surplus equipment, in each case, in the ordinary course of business.

“Capital Lease Obligations” of any Person shall mean all obligations of such Person to pay rent or other amounts under Capital Leases, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP.

“Capital Leases” shall mean, in respect of any Person, all leases which shall have been, or should have been, in accordance with GAAP, recorded as capital leases on the balance sheet of the Person liable (whether contingent or otherwise) for the payment of rent thereunder.

“Capital Stock” shall mean all shares, options, warrants, general or limited partnership interests, membership interests, participations or other equivalents (regardless of how designated) of or in a corporation, partnership, limited liability company or equivalent entity whether voting or nonvoting, including common stock, preferred stock or any other “equity security” (as such term is defined in Rule 3a11-1 of the General Rules and Regulations promulgated by the Securities and Exchange Commission under the Exchange Act).

“Change in Control” shall mean the occurrence of one or more of the following events:

(a) (i) any sale, lease, exchange or other transfer (in a single transaction or a series of related transactions) of all or substantially all of the assets of the Borrower to any Person or “group” (within the meaning of the Exchange Act and the rules of the Securities and Exchange Commission thereunder in effect on the date hereof), (ii) Parent fails to own 100% of the Capital Stock of the Borrower or (iii) any “person” or “group” (within the meaning of the Exchange Act and the rules of the Securities and Exchange Commission thereunder in effect on the date hereof) becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of 25% or more of the aggregate ordinary voting power represented by the issued and outstanding Capital Stock of Parent;

(b) any “change in control” or similar event occurs (as set forth in the agreements relating to the Borrower’s Capital Stock) causing the Borrower or any of its Subsidiaries to repurchase or redeem, or pursuant to such event be required to repurchase or redeem, all or any part of the Capital Stock of the Borrower for cash (except as permitted under Section 7.5 hereof); and

(c) the chief executive officer or chief financial officer of the Borrower who holds such position on the Closing Date fails to hold such position or diligently engage in the administration of such responsibilities, unless, in the case of the chief financial officer, a replacement reasonably acceptable to the Administrative Agent is appointed to be the chief financial officer of the Borrower within ninety (90) days of such failure.

“Change in Law” shall mean (i) the adoption or taking effect of any law, rule, regulation or treaty after the date of this Agreement, (ii) any change in any law, rule, regulation or treaty, or any change in the administration, interpretation, implementation or application thereof, by any Governmental Authority after the date of this Agreement, or (iii) compliance by any Lender (or its Applicable Lending Office) (or, for purposes of Section 2.19(b), by the Parent Company of such Lender, if applicable) with any request, rule, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the date of this Agreement; provided that for purposes of this Agreement, (x) the Xxxx-Xxxxx Xxxx Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.

“Closing Date” shall mean the date on which the conditions precedent set forth in Section 3.1 and Section 3.2 have been satisfied or waived in accordance with Section 10.2.

“Code” shall mean the Internal Revenue Code of 1986, as amended and in effect from time to time.

“Collateral” shall mean all tangible and intangible property, real and personal, of any Loan Party that is, or purports to be, subject to a Lien created in favor of the Collateral Agent to secure the whole or any part of the Obligations or any Guarantee thereof pursuant to the terms of one or more Collateral Documents.

“Collateral Agent” shall have the meaning set forth in the introductory paragraph hereof.

“Collateral Documents” shall mean, collectively, the Guaranty Agreements, the Security Agreements, the Mortgages, the Transfer Letters, the Control Account Agreements, and all other instruments and agreements now or hereafter executed and delivered by any Loan Party securing or perfecting the Liens securing the whole or any part of the Obligations or any Guarantee thereof, all UCC financing statements, fixture filings and stock powers, and all other documents, instruments, agreements and certificates executed and delivered by any Loan Party, in each case in connection with any of the foregoing.

“Commitment” shall mean, with respect to each Lender, the commitment of such Lender to make Loans on the Closing Date, expressed as an amount representing the maximum aggregate amount of such Lender’s Credit Exposure hereunder, not to exceed such Lender’s Maximum Loan Amount.

“Commodity Exchange Act” shall mean the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended and in effect from time to time, and any successor statute.

“Company Governing Agreement” shall mean the Bylaws of the Borrower, as amended from time to time in a manner not adverse to the interest of the Administrative Agent and each Lender in their capacity as Administrative Agent or Lender, and in the event the Borrower converts into a limited liability company, partnership, or corporation, as applicable, its articles or certificate of incorporation and bylaws, any related stockholder or shareholder agreement or certificate of limited partnership containing provisions from such Company Governing Agreement.

“Compliance Certificate” shall mean a certificate from the principal executive officer or the principal financial officer of the Borrower in the form of, and containing the certifications set forth in, the certificate attached hereto as Exhibit 5.1(c).

“Connection Income Taxes” shall mean Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.

“Consolidated EBITDAX” shall mean, for the Parent, the Borrower and its Subsidiaries for any period, an amount equal to the sum of (i) Consolidated Net Income for such period plus (ii) to the extent deducted in determining Consolidated Net Income for such period, and without duplication, (A) Consolidated Interest Expense for such period, (B) income tax expense determined on a consolidated basis in accordance with GAAP for such period, (C) depreciation, depletion, accretion and amortization determined on a consolidated basis in accordance with GAAP for such period, (D) exploration expenses determined on a consolidated basis in accordance with GAAP for such period, (E) out-of-pocket attorneys’ fees incurred in connection with the negotiation and closing of this Agreement and the other Loan Documents, and (F) non-cash charges resulting from the requirements of ASC 410, 718 and 815, any provision for the reduction in the carrying value of assets recorded in accordance with GAAP, and all other non-cash charges acceptable to the Administrative Agent determined on a consolidated basis, minus (iii) to the extent included in determining Consolidated Net Income, all noncash income added to Consolidated Net Income for such period (without duplication in respect of items considered in the definition of Consolidated Net Income hereunder); provided that, for purposes of calculating compliance with the financial covenants set forth in Article VI, to the extent that during such period any Loan Party shall have consummated an acquisition permitted by this Agreement or any sale, transfer or other disposition of any Person, business, property or assets permitted by this Agreement, Consolidated EBITDAX shall be calculated on a Pro Forma Basis with respect to such Person, business, property or assets so acquired or disposed of.

“Consolidated Fixed Charges” means, for any period, the sum of the following determined on a consolidated basis in accordance with GAAP: (a) Consolidated Interest Expense paid or payable in cash, (b) scheduled principal repayments of the Loans pursuant to Section 2.8, (c) federal, state, local and foreign income taxes paid in cash, (d) cash dividends and distributions and (e) Capital Expenditures.

“Consolidated Interest Expense” shall mean, for the Parent, the Borrower and its Subsidiaries for any period, determined on a consolidated basis in accordance with GAAP, total interest expense, including, without limitation, the interest component of any payments in respect of Capital Lease Obligations, capitalized or expensed during such period (whether or not actually paid during such period).

“Consolidated Net Income” shall mean, for the Parent, the Borrower and its Subsidiaries for any period, the net income (or loss) of the Parent, the Borrower and its Subsidiaries for such period determined on a consolidated basis in accordance with GAAP, but excluding therefrom (to the extent otherwise included therein) (i) any extraordinary gains or losses, (ii) any write-ups of assets or write-downs of assets (other than the sale of inventory in the ordinary course of business), (iii) any equity interest of the Parent, the Borrower or any Subsidiary of the Borrower in the unremitted earnings of any Person that is not a Subsidiary except to the extent of cash dividends actually received, (iv) any income (or loss) of any Person accrued prior to the date it becomes a Subsidiary or is merged into or consolidated with the Borrower or any Subsidiary or the date that such Person’s assets are acquired by the Borrower or any Subsidiary, (v) non-cash gains, losses or adjustments under ASC 815 as a result in the fair market value of derivatives, (vi) fees and other expenses incurred in connection with the negotiation, closing, and ongoing servicing and administration of this Agreement and the other Loan Documents, and (vii) the cumulative effect of any change in GAAP.

“Consolidated Total Debt” shall mean, as of any date, all Indebtedness for borrowed money of the Parent, the Borrower and its Subsidiaries measured on a consolidated basis as of such date, including Capital Lease Obligations, and other debt obligations for borrowed money.

“Contractual Obligation” of any Person shall mean any provision of any security issued by such Person or of any agreement, instrument or undertaking under which such Person is obligated or by which it or any of the property in which it has an interest is bound.

“Control Account Agreement” shall mean any tri-party agreement by and among a Loan Party, the Collateral Agent and the applicable depositary bank, in each case in form and substance satisfactory to the Administrative Agent.

“Controlled Account” shall have the meaning set forth in Section 5.11.

“Credit Exposure” shall mean, with respect to any Lender at any time, the outstanding principal amount of such Lender’s Loans.

“Current Assets” shall mean all current assets of the Parent, the Borrower and its consolidated Subsidiaries as of any date of determination calculated in accordance with GAAP, but excluding non-cash assets under ASC 815.

“Current Liabilities” shall mean all liabilities of the Parent, the Borrower and its consolidated Subsidiaries that should, calculated in accordance with GAAP, be classified as current liabilities as of such applicable date of determination, and in any event including all Indebtedness payable on demand or within one year from such date of determination without any option on the part of the obligor to extend or renew beyond such year and all accruals for federal or other taxes based on or measured by income and due and payable within such year, but excluding the current portion of long-term Indebtedness required to be paid within one year, the aggregate outstanding principal balance of the Loans and non-cash obligations under ASC 815.

“Debt Service” shall mean, for any period of time, the aggregate amount of all principal, interest (including, without duplication of interest amounts payable under this Agreement, ordinary course settlement amounts payable by the Borrower under any interest rate Hedging Transaction not prohibited by Section 7.10, net of ordinary course settlement amounts received by the Borrower thereunder during the relevant period) and fees under this Agreement and the Loan Documents that are due and payable during such period of time; provided that (a) all voluntary or mandatory prepayments of principal shall be excluded from such computation and (b) when projecting Debt Service on a forecasted basis, the parties shall assume that interest rates as of the date of determination shall remain unchanged during the forecasted period.

“Debtor Relief Laws” shall mean the Bankruptcy Code of the United States of America, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States or other applicable jurisdictions from time to time in effect.

“Default” shall mean any condition or event that, with the giving of notice or the lapse of time or both, would constitute an Event of Default.

“Default Interest” shall have the meaning set forth in Section 2.14(b).

“Defaulting Lender” shall mean, subject to Section 2.24(b), any Lender that (a) has failed to (i) fund all or any portion of its Loans within two (2) Business Days of the date such Loans were required to be funded hereunder unless such Lender notifies the Administrative Agent and the Borrower in writing that such failure is the result of such Lender’s determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, or (ii) pay to the Administrative Agent or any other Lender any other amount required to be paid by it hereunder within two (2) Business Days of the date when due, (b) has notified the Borrower or the Administrative Agent in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect (unless such writing or public statement relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three (3) Business Days after written request by the Administrative Agent or the Borrower, to confirm in writing to the Administrative Agent and the Borrower that it will comply with its prospective funding obligations hereunder (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Borrower), or (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor Relief Law or a Bail-In Action, or (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority acting in such a capacity; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender. Any determination by the Administrative Agent that a Lender is a Defaulting Lender under clauses (a) through (d) above shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 2.24(a)) upon delivery of written notice of such determination to the Borrower and each Lender.

“Defensible Title” shall mean as to any proved Oil and Gas Property, defensible title and such title held by a Loan Party that (i) entitles such Loan Party to receive not less than the “Net Revenue Interest” set forth in the most recent Reserve Report with respect to such proved Oil and Gas Property without reduction, suspension or termination throughout the productive life of such proved Oil and Gas Property except as otherwise disclosed in such Reserve Report; (ii) obligates such Loan Party to bear costs and expenses relating to operations on and the maintenance and development of each proved Oil and Gas Property in an amount not greater than the “Working Interest” set forth in the most recent Reserve Report with respect to such proved Oil and Gas Property (except to the extent that such Loan Party is obligated under an operating agreement to assume a portion of a defaulting or non-consenting party’s share of costs), without increase for the respective productive life of such proved Oil and Gas Property except as disclosed in such Reserve Report and except, in each case, as to increases accompanied by corresponding proportionate increases in the Net Revenue Interest applicable to such proved Oil and Gas Property; and (iii) is free and clear of Liens prohibited by this Agreement under Section 7.2; provided that subsections (i) and (ii) are subject to any Asset Sales in compliance with Section 7.6 since the date of such applicable Reserve Report and subject to the expiration of leases in accordance with their terms.

“Dividing Person” has the meaning assigned to it in the definition of “Division”.

“Division” means the division of the assets, liabilities and/or obligations of a Person (the “Dividing Person”) among two or more Persons (whether pursuant to a “plan of division” or similar arrangement), which may or may not include the Dividing Person and pursuant to which the Dividing Person may or may not survive.

“Dollar(s)” and the sign “$” shall mean lawful money of the United States.

“EEA Financial Institution” shall mean (a) any institution established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

“EEA Member Country” shall mean any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

“EEA Resolution Authority” shall mean any public administrative authority or any Person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

“Eligible Mortgaged Property” shall mean any Mortgaged Properties for which the Administrative Agent has received title opinions or other title information under Section 5.14(a) satisfactory to the Administrative Agent.

“Engineering Reports” shall mean, collectively, (a) the Reserve Reports and the certificates required to be delivered by the Borrower to the Administrative Agent, in the case of an Asset Coverage Ratio Test Date or an Interim Asset Coverage Ratio Test Date, pursuant to Section 5.13, and, and (b) such other reports, data and supplemental information, including, without limitation, the information provided pursuant to clause (c) of Section 5.13, as may, from time to time, be reasonably requested by the Majority Lenders.

“Environmental Laws” shall mean all laws, rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions, notices or binding agreements issued, promulgated or entered into by or with any Governmental Authority relating in any way to the environment, preservation or reclamation of natural resources, the management, Release or threatened Release of any Hazardous Material or to health and safety matters, including, without limitation, the Oil Pollution Act of 1990 (“OPA”), the Clean Air Act, the Comprehensive Environmental, Response, Compensation, and Liability Act of 1980 (“CERCLA”), the Federal Water Pollution Control Act, the Occupational Safety and Health Act of 1970, the Resource Conservation and Recovery Act of 1976 (“RCRA”), the Safe Drinking Water Act, the Toxic Substances Control Act, the Superfund Amendments and Reauthorization Act of 1986, and the Hazardous Materials Transportation Act. For the purposes of this definition, Section 4.5 and Section 5.17, the term “oil” shall have the meaning specified in OPA, the terms “hazardous substance” and “release” (or “threatened release”) shall have the meanings specified in CERCLA, the terms “solid waste” and “disposal” (or “disposed”) shall have the meanings specified in RCRA and the term “oil and gas waste” shall mean wastes associated with the exploration, development, or production of crude oil or natural gas.

“Environmental Liability” shall mean any liability, contingent or otherwise (including any liability for damages, costs of environmental investigation and remediation, costs of administrative oversight, fines, natural resource damages, penalties or indemnities), of the Borrower or any of its Subsidiaries directly or indirectly resulting from or based upon (i) any actual or alleged violation of any Environmental Law, (ii) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (iii) any actual or alleged exposure to any Hazardous Materials, (iv) the Release or threatened Release of any Hazardous Materials or (v) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

“Environmental Permit” shall mean any permit, registration, license, approval, consent, exemption, variance, or other authorization required under or issued pursuant to applicable Environmental Laws.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended from time to time, and any successor statute and the regulations promulgated and rulings issued thereunder.

“ERISA Affiliate” shall mean any person that for purposes of Title I or Title IV of ERISA or Section 412 of the Code would be deemed at any relevant time to be a “single employer” or otherwise aggregated with the Borrower or any of its Subsidiaries under Section 414(b), (c), (m) or (o) of the Code or Section 4001 of ERISA.

“ERISA Event” shall mean (i) any “reportable event” as defined in Section 4043 of ERISA with respect to a Plan (other than an event as to which the PBGC has waived under subsection .22, .23, .25, .27 or .28 of PBGC Regulation Section 4043 the requirement of Section 4043(a) of ERISA that it be notified of such event); (ii) any failure to make a required contribution to any Plan that would result in the imposition of a lien or other encumbrance or the provision of security under Section 430 of the Code or Section 303 or 4068 of ERISA, or the arising of such a lien or encumbrance, there being or arising any “unpaid minimum required contribution” or “accumulated funding deficiency” (as defined or otherwise set forth in Section 4971 of the Code or Part 3 of Subtitle B of Title 1 of ERISA), whether or not waived, or any filing of any request for or receipt of a minimum funding waiver under Section 412 of the Code or Section 303 of ERISA with respect to any Plan or Multiemployer Plan, or that such filing may be made, or any determination that any Plan is, or is expected to be, in at-risk status under Title IV of ERISA; (iii) any incurrence by the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates of any liability under Title IV of ERISA with respect to any Plan or Multiemployer Plan (other than for premiums due and not delinquent under Section 4007 of ERISA); (iv) any institution of proceedings, or the occurrence of an event or condition which would reasonably be expected to constitute grounds for the institution of proceedings by the PBGC, under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan; (v) any incurrence by the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates of any liability with respect to the withdrawal or partial withdrawal from any Plan or Multiemployer Plan, or the receipt by the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates of any notice that a Multiemployer Plan is in endangered or critical status under Section 305 of ERISA; (vi) any receipt by the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates of any notice, or any receipt by any Multiemployer Plan from the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates of any notice, concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA; (vii) engaging in a non-exempt prohibited transaction within the meaning of Section 4975 of the Code or Section 406 of ERISA; or (viii) any filing of a notice of intent to terminate any Plan if such termination would require material additional contributions in order to be considered a standard termination within the meaning of Section 4041(b) of ERISA, any filing under Section 4041(c) of ERISA of a notice of intent to terminate any Plan, or the termination of any Plan under Section 4041(c) of ERISA.

“EU Bail-In Legislation Schedule” shall mean the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor Person), as in effect from time to time.

“Eurodollar”, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, bears interest at a rate determined by reference to the Adjusted LIBO Rate.

“Event of Default” shall have the meaning set forth in Section 8.1.

“Event of Loss” means, with respect to any Property or business interruption insurance, any of the following: (a) any loss, destruction or damage of such Property; (b) any pending or threatened institution of any proceedings for the condemnation or seizure of such Property or for the exercise of any right of eminent domain; (c) any actual condemnation, seizure or taking, by exercise of the power of eminent domain or otherwise, of such Property, or confiscation of such Property or the requisition of the use of such Property; or (d) receipt of proceeds from business interruption insurance.

“Excepted Liens” shall mean (a) Liens for Taxes, assessments or other governmental charges or levies which are not delinquent or which are being contested in good faith by appropriate action and for which adequate reserves have been maintained in accordance with GAAP; (b) Liens in connection with workers’ compensation, unemployment insurance or other social security, old age pension or public liability obligations which are not delinquent or which are being contested in good faith by appropriate action and for which adequate reserves have been maintained in accordance with GAAP; (c) statutory landlord’s liens, operators’, vendors’, carriers’, warehousemen’s, repairmen’s, mechanics’, suppliers’, workers’, materialmen’s, construction or other like Liens, in each case, arising by operation of law in the ordinary course of business or incident to the exploration, development, operation and maintenance of Oil and Gas Properties each of which is in respect of obligations that are not delinquent or which are being contested in good faith by appropriate action and for which adequate reserves have been maintained in accordance with GAAP; (d) contractual Liens that arise in the ordinary course of business under operating agreements, oil and gas leases, division orders, contracts for the sale, transportation or processing of oil and natural gas (but solely to the extent relating to dedications of future production), unitization and pooling declarations and agreements, gas balancing or deferred production agreements, and other agreements that are usual and customary in the oil and gas business and, in each case of the foregoing, to the extent such Liens, provided that any such Lien referred to in this clause (i) is for a claim that is not delinquent or which is being contested in good faith by appropriate action and for which adequate reserves have been maintained in accordance with GAAP, (ii) does not materially impair the use of the Property covered by such Lien for the purposes for which such Property is held by the applicable Loan Party or materially impair the value of such Property subject thereto or (iii) does not decrease a Loan Party’s net revenue interest in any Oil and Gas Property below that set forth in the most recently delivered Reserve Report; (e) Liens arising solely by virtue of any statutory or common law provision relating to banker’s liens, rights of set-off or similar rights and remedies that have not been waived in favor of the Collateral Agent and burdening only deposit accounts or other funds maintained with a creditor depository institution, provided that no such deposit account is a dedicated cash collateral account or is subject to restrictions against access by the depositor in excess of those set forth by regulations promulgated by the Board and no such deposit account is intended by the any Loan Party to provide collateral to the depository institution; (f) easements, restrictions, servitudes, permits, conditions, covenants, exceptions or reservations in any Property of any Loan Party for the purpose of roads, pipelines, transmission lines, transportation lines, distribution lines for the removal of gas, oil, coal or other minerals or timber, and other like purposes, or for the joint or common use of real estate, rights of way, facilities and equipment, that do not secure any monetary obligations and which in the aggregate do not materially impair the use of such Property for the purposes of which such Property is held by such Loan Party or materially impair the value of such Property subject thereto; (g) Liens on cash or securities pledged to secure performance of tenders, surety and appeal bonds, government contracts, performance and return of money bonds, bids, trade contracts, leases, statutory obligations, regulatory obligations and other obligations of a like nature incurred in the ordinary course of business, (h) judgment and attachment Liens not giving rise to an Event of Default, provided that any appropriate legal proceedings which may have been duly initiated for the review of such judgment shall not have been finally terminated or the period within which such proceeding may be initiated shall not have expired and no action to enforce such Lien has been commenced, (i) any interest or title of a lessor, sublessor, licensor or sublicensor under any lease, sublease, license or sublicense permitted by this Agreement (other than any leases of, under or related to Hydrocarbon Interests); (j) Liens on xxxx xxxxxxx money deposited pursuant to the terms of an agreement to acquire assets used in, or Persons engaged in, the oil and gas business, to the extent permitted by this Agreement; (k) licenses of intellectual property, none which, in the aggregate, materially impair the operation of the business of the Loan Parties; and (l) any Lien granted by the lessor of a lease comprising a part of the Hydrocarbon Interests or covering the lessor’s interest in the Hydrocarbons covered by such lease unless (i) such debt is in default or alleged to be in default by the holder of the debt or (ii) foreclosure proceedings have been commenced with respect to such lien or security interest; provided, further that (i) Liens described in clauses (a) through (e) and (g) shall remain “Excepted Liens” only for so long as no action to enforce such Lien has been commenced and no intention to subordinate the first priority Lien granted in favor of the Collateral Agent is to be hereby implied or expressed by the permitted existence of such Excepted Liens and (ii) the term “Excepted Liens” shall not include any Lien securing Debt for borrowed money.

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended and in effect from time to time.

“Excluded Meeting Portions” shall have the meaning set forth in Section 5.22.

“Excluded Swap Obligation” shall mean, with respect to any Guarantor, any Swap Obligation if, and to the extent that, all or a portion of the Guarantee of such Guarantor of, or the grant by such Guarantor of a security interest to secure, such Swap Obligation (or any Guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Guarantor’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act at the time the Guarantee of such Guarantor becomes effective with respect to such related Swap Obligation. If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to swaps for which such Guarantee or security interest is or becomes illegal.

“Excluded Taxes” shall mean any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan or Commitment pursuant to a law in effect on the date on which (i) such Lender acquires such interest in the Loan or Commitment or (ii) such Lender changes its lending office, except in each case to the extent that, pursuant to Section 2.21, amounts with respect to such Taxes were payable either to such Lender's assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its lending office, (c) Taxes attributable to such Recipient’s failure to comply with Section 2.21, (d) any U.S. federal withholding Taxes imposed under FATCA, and (e) U.S. federal backup withholding taxes or similar tax imposed by any Governmental Authority.

“Existing Facility” shall mean the loan facility evidenced by that certain Credit Agreement dated as of January 27, 2014, by and among the Borrower, Mutual of Omaha Bank, as administrative agent and L/C Issuer, and the other lenders party thereto from time to time, as such agreement was amended, restated, supplemented or otherwise modified from time to time.

“FATCA” shall mean Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof and any agreements entered into pursuant to Section 1471(b)(1) of the Code.

“Federal and State Leases” shall have the meaning assigned to such term in Section 5.25(c)(i).

“Federal Flood Insurance” shall mean federally backed Flood Insurance available under the National Flood Insurance Program to owners of real property improvements located in Special Flood Hazard Areas in a community participating in the National Flood Insurance Program.

“Federal Funds Rate” shall mean, for any day, the rate per annum (rounded upwards, if necessary, to the next 1/100 of 1%) equal to the weighted average of the rates on overnight Federal funds transactions with member banks of the Federal Reserve System arranged by Federal funds brokers, as published by the Federal Reserve Bank of New York on the next succeeding Business Day or, if such rate is not so published for any Business Day, the Federal Funds Rate for such day shall be the average (rounded upwards, if necessary, to the next 1/100 of 1%) of the quotations for such day on such transactions received by the Administrative Agent from three Federal funds brokers of recognized standing selected by the Administrative Agent.

“FEMA” shall mean the Federal Emergency Management Agency, a component of the United States Department of Homeland Security that administers the National Flood Insurance Program.

“Fiscal Quarter” shall mean any fiscal quarter of the Borrower.

“Fiscal Year” shall mean any fiscal year of the Borrower.

“Fixed Charge Coverage Ratio” shall mean, as of the last day of any fiscal quarter, the ratio of (i) Consolidated EBITDAX for the Fiscal Quarter just ended plus unrestricted cash and cash equivalents on the last day of the preceding Fiscal Quarter to (ii) Consolidated Fixed Charges for the Fiscal Quarter just ended.

“Flood Insurance” shall mean, for any owned real property located in a Special Flood Hazard Area, Federal Flood Insurance or private insurance that meets or exceeds the requirements set forth by FEMA in its Mandatory Purchase of Flood Insurance Guidelines. Flood Insurance shall be in commercially reasonable amounts at least up to the maximum policy limits set under the National Flood Insurance Program, or as otherwise required by the Administrative Agent in its reasonable judgment, with deductibles not to exceed $250,000 for losses to buildings and $250,000 for losses to contents of buildings.

“Flood Insurance Laws” shall mean collectively, (a) the National Flood Insurance Reform Act of 1994 (which comprehensively revised the National Flood Insurance Act of 1968 and the Flood Disaster Protection Act of 1973), as now or hereafter in effect or any successor statute thereto, (b) the Flood Insurance Reform Act of 2004, as now or hereafter in effect or any successor statute thereto and (c) the Biggert –Waters Flood Insurance Reform Act of 2012, as now or hereafter in effect of any successor statute thereto, in each case, together with all statutory and regulatory provisions consolidating, amending, replacing, supplementing, implementing or interpreting any of the foregoing, as amended or modified from time to time.

“Foreign Lender” shall mean (a) if the Borrower is a U.S. Person, a Lender that is not a U.S. Person, and (b) if the Borrower is not a U.S. Person, a Lender that is resident or organized under the laws of a jurisdiction other than that in which the Borrower is resident for tax purposes.

“G&A Expenses” shall mean the actual general and administrative expenses of Borrower including capitalized general and administrative expenses, calculated in accordance with GAAP.

“GAAP” shall mean generally accepted accounting principles in the United States applied on a consistent basis and subject to the terms of Section 1.3.

“Governmental Authority” shall mean the government of the United States, any other nation or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).

“Guarantee” of or by any Person (the “guarantor”) shall mean any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation of any other Person (the “primary obligor”) in any manner, whether directly or indirectly and including any obligation, direct or indirect, of the guarantor (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (ii) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (iii) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation or (iv) as an account party in respect of any letter of credit or letter of guaranty issued in support of such Indebtedness or obligation; provided that the term “Guarantee” shall not include endorsements for collection or deposit in the ordinary course of business. The amount of any Guarantee shall be deemed to be an amount equal to the stated or determinable amount of the primary obligation in respect of which such Guarantee is made or, if not so stated or determinable, the maximum reasonably anticipated liability in respect thereof (assuming such Person is required to perform thereunder) as determined by such Person in good faith. The term “Guarantee” used as a verb has a corresponding meaning.

“Guarantor” shall mean (i) Parent and (ii) each of the Subsidiary Loan Parties.

“Guaranty Agreements” shall mean (i) the Parent Guaranty Agreement, (ii) the Subsidiary Guaranty Agreement, and (iii) each other guaranty agreement made in favor of the Administrative Agent for the benefit of the Lenders, in form and substance satisfactory to the Administrative Agent.

“Hazardous Materials” shall mean all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants, including Hydrocarbons, petroleum or petroleum distillates, natural gas, oil, oil and gas waste, crude oil, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to any Environmental Law.

“Hedge Intercreditor Agreement” means the Intercreditor Agreement, dated as of the date hereof, by and among the Borrower, the Guarantors, the Administrative Agent, the Collateral Agent and one or more Approved Counterparties, as the same may from time to time be amended, amended and restated, modified or supplemented.

“Hedge Termination Value” shall mean, in respect of any one or more Hedging Transactions, after taking into account the effect of any legally enforceable netting agreement relating to such Hedging Transactions, (a) for any date on or after the date such Hedging Transactions have been closed out and termination value(s) determined in accordance therewith, such termination value(s) and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the value(s) for such Hedging Transactions, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Hedging Transactions (which may include a Lender or any Affiliate of a Lender).

“Hedging Obligations” of any Person shall mean any and all obligations of such Person, whether absolute or contingent and howsoever and whensoever created, arising, evidenced or acquired under (i) any and all Hedging Transactions, (ii) any and all cancellations, buy backs, reversals, terminations or assignments of any Hedging Transactions and (iii) any and all renewals, extensions and modifications of any Hedging Transactions and any and all substitutions for any Hedging Transactions.

“Hedging Transaction” of any Person shall mean (a) any transaction (including an agreement with respect to any such transaction) now existing or hereafter entered into by such Person that is a rate swap transaction, swap option, basis swap, forward rate transaction, commodity swap, commodity option, equity or equity index swap or option, bond option, interest rate option, foreign exchange transaction, cap transaction, floor transaction, collar transaction, currency swap transaction, cross-currency rate swap transaction, currency option, spot transaction, credit protection transaction, credit swap, credit default swap, credit default option, total return swap, credit spread transaction, repurchase transaction, reverse repurchase transaction, buy/sell-back transaction, securities lending transaction, or any other similar transaction (including any option with respect to any of these transactions) or any combination thereof, whether or not any such transaction is governed by or subject to any master agreement, and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement (any such master agreement, together with any related schedules, a “Master Agreement”), including any such obligations or liabilities under any Master Agreement.

“Hydrocarbon Interests” shall mean all rights, titles, interests and estates now or hereafter acquired in and to oil and gas leases, oil, gas and mineral leases, or other liquid or gaseous hydrocarbon leases, mineral fee interests, overriding royalty and royalty interests, net profit interests and production payment interests, including any reserved or residual interests of whatever nature.

“Hydrocarbons” shall mean oil, gas, casinghead gas, drip gasoline, natural gasoline, condensate, distillate, liquid hydrocarbons, gaseous hydrocarbons and all products refined or separated therefrom.

“Indebtedness” of any Person shall mean, without duplication, (i) all obligations of such Person for borrowed money, (ii) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments, (iii) all obligations of such Person in respect of the deferred purchase price of property or services (other than trade payables incurred in the ordinary course of business; provided that, for purposes of Section 8.1(f), trade payables overdue by more than 120 days shall be included in this definition except to the extent that any of such trade payables are being disputed in good faith by appropriate measures and for which adequate reserves are being maintained in accordance with GAAP), (iv) all obligations of such Person under any conditional sale or other title retention agreement(s) relating to property acquired by such Person (other than customary reservations or retentions of title under agreements with suppliers entered into in the ordinary course of business), (v) all Capital Lease Obligations of such Person, (vi) all obligations, contingent or otherwise, of such Person in respect of letters of credit, acceptances or similar extensions of credit, (vii) all Guarantees of such Person of the type of Indebtedness described in clauses (i) through (vi) above, (viii) all Indebtedness of a third party to the extent such Indebtedness is secured by any Lien on property owned by such Person, whether or not such Indebtedness has been assumed by such Person, (ix) all obligations of such Person, contingent or otherwise, to purchase, redeem, retire or otherwise acquire for value any Capital Stock of such Person, (x) all Off-Balance Sheet Liabilities, (xi) any obligations of such Person owing in connection with any volumetric or production prepayments or take-or-pay arrangements and (xii) all net Hedging Obligations, which for purposes hereof, the amount of any net Hedging Obligations on any date shall be deemed to be the Hedge Termination Value thereof as of such date. The Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture in which such Person is a general partner or a joint venture, but only to the extent to which there is recourse to such Person for the payment of such Indebtedness, except to the extent that the terms of such Indebtedness provide that such Person is not liable therefor.

“Indemnified Taxes” shall mean (a) Taxes other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of any Loan Party under any Loan Document and (b) to the extent not otherwise described in (a), Other Taxes.

“Initial Acquisition and Development Plan” shall have the meaning set forth in Section 2.3(a).

“Initial Reserve Report” shall mean that certain database of information titled 'SAMSON0118 - NYMEX.mdb’ delivered to the Administrative Agent by the Borrower’s principle executive officer via electronic mail on January 21, 2019, pursuant to Section 3.1(b)(xx).

“Interest Period” shall mean with respect to any Eurodollar Borrowing, a period of one Month; provided that:

(i) the initial Interest Period for such Borrowing shall commence on the date of such Borrowing (including the date of any conversion from a Borrowing of another Type), and each Interest Period occurring thereafter in respect of such Borrowing shall commence on the day on which the next preceding Interest Period expires;

(ii) if any Interest Period would otherwise end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day, unless such Business Day falls in another calendar month, in which case such Interest Period would end on the next preceding Business Day;

(iii) any Interest Period which begins on the last Business Day of a calendar month or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period shall end on the last Business Day of the last calendar month of such Interest Period; and

(iv) no Interest Period may extend beyond the Maturity Date.

“Interim Asset Coverage Ratio Test Date” shall mean any date designated by the Administrative Agent, in its sole discretion, upon not less than thirty (30) days’ notice in the Interim Request.

“Interim Request” shall have the meaning set forth in Section 5.13(b).

“Investments” shall have the meaning set forth in Section 7.4.

“IRS” shall mean the United States Internal Revenue Service.

“Lenders” shall have the meaning set forth in the introductory paragraph hereof.

“Leverage Ratio” shall mean, as of the last day of any fiscal quarter, the ratio of (i) an amount equal to Consolidated Total Debt as of the last day of such fiscal quarter to (ii) Consolidated EBITDAX for the four consecutive Fiscal Quarters ending on or immediately prior to such date for which financial statements are required to have been delivered under this Agreement; provided, however, Consolidated EBITDAX shall be calculated as follows for the following periods: (a) for the period of calculation ending on or before June 30, 2019, multiplying Consolidated EBITDAX by 4, (b) for the period of calculation commencing July 1, 2019 and ending September 30, 2019, multiplying Consolidated EBITDAX by 2, and (c) for the period of calculation commencing October 1, 2019 and ending December 31, 2019, multiplying Consolidated EBITDAX by 4/3.

“Lien” shall mean any mortgage, pledge, security interest, lien (statutory or otherwise), charge, encumbrance, hypothecation, assignment, deposit arrangement, or other arrangement having the practical effect of any of the foregoing, or any preference, priority or other security agreement or preferential arrangement, of any kind or nature whatsoever (including any conditional sale or other title retention agreement and any Capital Lease having the same economic effect as any of the foregoing).

“Loan Documents” shall mean, collectively, this Agreement, the Collateral Documents, the Hedge Intercreditor Agreement, all Compliance Certificates, any promissory notes issued hereunder and any and all other instruments, agreements, documents and writings executed or delivered by a Loan Party in connection with any of the foregoing.

“Loan Parties” shall mean the Borrower, each Guarantor and the Subsidiary Loan Parties.

“Loans” shall mean all loans in the aggregate or any of them, as the context may require, made by a Lender to the Borrower under its Commitment, which will be Eurodollar Loans; provided, however, if Eurodollar Loans are determined in good faith by the Administrative Agent to be not available, then such loans will be Base Rate Loans.

“Lockbox Account” shall have the meaning set forth in Section 2.9(a).

“Lockbox Account Waterfall” shall have the meaning set forth in Section 2.9(a).

“Majority Lenders” shall mean, Lenders holding a majority of the aggregate outstanding Commitments at such time or, if the Lenders have no Commitments outstanding, then Lenders holding more than 50% of the aggregate outstanding Credit Exposure of the Lenders at such time; provided that to the extent that any Lender is a Defaulting Lender, such Defaulting Lender and all of its Commitments and Credit Exposure shall be excluded for purposes of determining Majority Lenders.

“Material Adverse Effect” shall mean any material adverse change in, or a material adverse effect on, (i) the business, results of operations, financial condition or assets of the Borrower and its Subsidiaries taken as a whole, (ii) the ability of the Borrower to perform its obligations under the Loan Documents, (iii) the ability of the Loan Parties (other than the Borrower), as a whole, to perform their obligations under the Loan Documents, (iv) the rights and remedies of the Administrative Agent, the Collateral Agent or the Lenders under any of the Loan Documents or (v) the legality, validity or enforceability against any Loan Party of any of the Loan Documents to which it is a party (in the case of clauses (iv) and (v), other than as a result of an act or omission by the Administrative Agent, the Collateral Agent or any Lender).

“Material Agreements” shall mean (a) (i) all agreements, indentures or notes governing the terms of any Material Indebtedness and (ii) all employment and non-compete agreements with management and (b) (i) all agreements, instruments and conveyances relating to Hydrocarbon Interests, and (ii) all other agreements, documents, contracts, indentures and instruments pursuant to which, in the case of clauses (b)(i) and (b)(ii), (A) any Loan Party or any of its Subsidiaries are obligated to make payments in any twelve month period of $100,000 or more, (B) any Loan Party or any of its Subsidiaries expects to receive revenue in any twelve month period of $100,000 or more and (C) a default, breach or termination thereof could reasonably be expected to result in a Material Adverse Effect.

“Material Indebtedness” shall mean any Indebtedness (other than the Loans) of the Borrower or any of its Subsidiaries individually or in an aggregate committed or outstanding principal amount exceeding $100,000. For purposes of determining the amount of attributed Indebtedness from Hedging Obligations, the “principal amount” of any Hedging Obligations at any time shall be the Net Xxxx-to-Market Exposure of such Hedging Obligations.

“Maturity Date” shall mean April 9, 2024.

“Maximum Commitment” shall mean, with respect to each Lender, the Maximum Loan Amount set forth for such Lender on Schedule I.

“Maximum Loan Amount” shall mean as to each Lender, such Lender’s Pro Rata share of the Aggregate Maximum Loan Amount, as such commitment may be modified from time to time pursuant to assignments by or to such Lender pursuant to Section 10.4.

“Modified Proved NPV” shall mean, with respect to any reserves attributable to the Eligible Mortgaged Properties, the modified and risked NPV of such reserves, calculated by the Administrative Agent in its sole discretion and delivered to the Borrower from time to time by the Administrative Agent, based upon information delivered in connection with the most recently delivered Engineering Report and such other information (including, without limitation, title information, the existence of other Indebtedness, the Loan Parties’ hedged and unhedged exposure to price, price and production scenarios, interest rate and operating cost changes and other credit factors) as the Administrative Agent deems appropriate in its sole discretion and in each case consistent with its normal oil and gas lending criteria for similarly situated borrowers and credit facilities as it exists at the particular time; provided, however, that, without limitation to the foregoing, the Modified Proved NPV for any particular proved developed nonproducing reserves or proved undeveloped reserves shall be zero unless (i) Capital Expenditures for the development of such reserves, in at least the amounts required pursuant to the most recent Engineering Report (y) have been approved by the Administrative Agent in the applicable Approved Budget or (z) without the Approval of the Administrative Agent so long as PUDs are not greater than the combined Modified NPV for any particular PDP and PDNP, (ii) such capital is reasonably expected to be available to the applicable Loan Party pursuant to binding and enforceable commitments then in effect, and (iii) the applicable Loan Party has (or is reasonably expected to have) all licenses, permits, and authorizations necessary or required in order to develop, operate, and produce such proved developed nonproducing reserves or proved undeveloped reserves, as the case may be.

“Moody’s” shall mean Xxxxx’x Investors Service, Inc.

“Mortgaged Property” shall mean, as of any date of determination, any Property owned by any Loan Party which is subject to the Liens created under the terms of the Mortgages.

“Mortgages” shall mean each mortgage or deed of trust delivered by any Loan Party to the Collateral Agent from time to time, all in form and substance satisfactory to the Administrative Agent.

“Multiemployer Plan” shall mean any “multiemployer plan” as defined in Section 4001(a)(3) of ERISA, which is contributed to by (or to which there is or may be an obligation to contribute of) the Borrower, any of its Subsidiaries or an ERISA Affiliate, and each such plan for the five-year period immediately following the latest date on which the Borrower, any of its Subsidiaries or an ERISA Affiliate contributed to or had an obligation to contribute to such plan.

“National Flood Insurance Program” shall mean the program created by the United States Congress pursuant to the Flood Insurance Laws, that mandates the purchase of flood insurance to cover real property improvements located in Special Flood Hazard Areas in participating communities and provides protection to property owners through a federal insurance program.

“Net Xxxx-to-Market Exposure” of any Person shall mean, as of any date of determination with respect to any Hedging Obligation, the excess (if any) of all unrealized losses over all unrealized profits of such Person arising from such Hedging Obligation. “Unrealized losses” shall mean the fair market value of the cost to such Person of replacing the Hedging Transaction giving rise to such Hedging Obligation as of the date of determination (assuming such Hedging Transaction were to be terminated as of that date), and “unrealized profits” shall mean the fair market value of the gain to such Person of replacing such Hedging Transaction as of the date of determination (assuming such Hedging Transaction were to be terminated as of that date).

“Net Proceeds” means proceeds in cash, checks or other cash equivalent financial instruments (including cash equivalents) as and when received by the Person making an Asset Sale and insurance proceeds and condemnation and similar awards received on account of an Event of Loss, net of: (a) in the event of an Asset Sale, (i) the direct costs relating to such Asset Sale excluding amounts payable to any Loan Party or any Affiliate of any Loan Party and (ii) sale, use or other transaction taxes paid or payable as a result thereof and (b) in the event of an Event of Loss, (i) all money that actually will be applied to repair or reconstruct the damaged Property or Property affected by the condemnation or taking within one hundred twenty (120) days of the date of the Loan Parties’ (or their Affiliates’) receipt thereof and (ii) all of the costs and expenses reasonably incurred in connection with the collection of such proceeds, award or other payments.

“Net Revenue Interest” shall mean, with respect to any Oil and Gas Property, the decimal or percentage share of Hydrocarbons produced and saved from or allocable to that Oil and Gas Property, after deduction of Royalty Interests and other burdens on or paid out of such production.

“Non-Defaulting Lender” shall mean, at any time, a Lender that is not a Defaulting Lender.

“NPV” shall mean, with respect to any proved reserves expected to be produced from the Eligible Mortgaged Properties, the net present value of the future net revenues expected to accrue to the Loan Parties’ interests in such Proved Reserves during the remaining expected economic lives of such proved reserves, discounted at 10% per annum. Each calculation of such expected future net revenues shall be made as of the date requested in accordance with the then existing standards of the SPE and Society of Petroleum Evaluation Engineers, provided that in any event:

(a) appropriate deductions shall be made for (i) Direct Taxes and existing burdens that are Permitted Liens, (ii) leasehold operating expenses, (iii) losses from and expenses of gathering, compression, treating, processing, transportation, and marketing, and (iv) Capital Expenditures included in the then effective Acquisition and Development Plan or otherwise approved in writing by the Administrative Agent on behalf of Majority Lenders; and

(b) the pricing assumptions used in determining NPV for any particular proved reserves shall be the Agreed Pricing.

NPV shall be calculated hereunder in connection with each Engineering Report by an Approved Petroleum Engineer, or if the applicable Engineering Report is not required to be prepared by an Approved Petroleum Engineer, then by the Borrower in accordance with the methodologies used by the Approved Petroleum Engineer in previous Engineering Reports, and then such calculation shall be calculated and the amount verified by the Administrative Agent; provided, in the event of any conflict between the calculations, the Administrative Agent’s calculation shall be conclusive and final.

“NYMEX” shall mean the New York Mercantile Exchange.

“NYMEX 5-Year Strip” shall mean as of the date of determination, (a) for the 60-month period commencing with the month in which such date occurs, as quoted on NYMEX and published in a nationally recognized publication for such pricing as selected by the Administrative Agent (as such prices may be corrected or revised from time to time by the NYMEX in accordance with its rules and regulations), the corresponding monthly quoted futures contract price for months 0–60 and (b) for periods after such 60 month period, the average corresponding monthly quoted futures contract price for months 49–60, and in each instance of (a) and (b) shall reflect the price of the monthly future contract prices for each appropriate Hydrocarbon category included in the Reserve Report for the volumes of each type of Hydrocarbon produced and delivered at a particular location, adjusted for the basis differential between the actual delivery location and the reference price delivery location, and adjusted for any price differentials between the actual product delivered and the reference product, in each case using methodology consistent with past practices and in good faith based on observable differentials.

“Obligations” shall mean (a) all amounts owing by the Loan Parties to the Administrative Agent or any Lender pursuant to this Agreement, any other Loan Document or any Loan under the terms thereof, including to the extent provided therein, without limitation, all principal, interest (including any interest accruing after the filing of any petition in bankruptcy or the commencement of any insolvency, reorganization or like proceeding relating to any Loan Party, whether or not a claim for post-filing or post-petition interest is allowed in such proceeding), reimbursement obligations, fees, expenses, indemnification and reimbursement payments, costs and expenses (including all reasonable fees and expenses of counsel to the Administrative Agent and, if applicable, any Lender, in each case due and owing by the Borrower as provided under the terms of this Agreement or any other Loan Document), whether direct or indirect, absolute or contingent, liquidated or unliquidated, now existing or hereafter arising hereunder or thereunder, (b) all Hedging Obligations owed by any Loan Party to any Secured Hedge Party; provided, however, that with respect to any Guarantor, the Obligations shall not include any Excluded Swap Obligations, and (c) the Related Costs.

“OFAC” shall mean the U.S. Department of the Treasury’s Office of Foreign Assets Control.

“Off-Balance Sheet Liabilities” of any Person shall mean (i) any repurchase obligation or liability of such Person with respect to accounts or notes receivable sold by such Person, (ii) any liability of such Person under any sale and leaseback transactions that do not create a liability on the balance sheet of such Person, or (iii) any obligation arising with respect to any other transaction which is the functional equivalent of or takes the place of borrowing but which does not constitute a liability on the balance sheet of such Person.

“Offtake Agreement” shall have the meaning set forth in Section 3.1(b)(xxiii).

“Oil and Gas Properties” shall mean (i) Hydrocarbon Interests; (ii) the Properties now or hereafter pooled or unitized with Hydrocarbon Interests; (iii) all presently existing or future unitization, pooling agreements and declarations of pooled units and the units created thereby (including without limitation all units created under orders, regulations and rules of any Governmental Authority) which may affect all or any portion of the Hydrocarbon Interests; (iv) all operating agreements, contracts and other agreements, including production sharing contracts and agreements, which relate to any of the Hydrocarbon Interests or the production, sale, purchase, exchange or processing of Hydrocarbons from or attributable to such Hydrocarbon Interests; (v) all Hydrocarbons in and under and which may be produced and saved from or attributable to the Hydrocarbon Interests, including all oil in tanks, and all rents, issues, profits, proceeds, products, revenues and other incomes from or attributable to the Hydrocarbon Interests; (vi) all tenements, hereditaments, appurtenances and Properties in any manner appertaining, belonging, affixed or incidental to the Hydrocarbon Interests and (vii) all Properties, rights, titles, interests and estates described or referred to above, including any and all Property, real or personal, now owned or hereinafter acquired and situated upon, used, held for use or useful in connection with the operating, working or development of any of such Hydrocarbon Interests or Property and including any and all oil xxxxx, gas xxxxx, injection xxxxx or other xxxxx, buildings, structures, fuel separators, liquid extraction plants, plant compressors, pumps, pumping units, field gathering systems, tanks and tank batteries, fixtures, valves, fittings, machinery and parts, engines, boilers, meters, apparatus, equipment, appliances, tools, implements, cables, wires, towers, casing, tubing and rods, surface leases, rights-of-way, easements and servitudes together with all additions, substitutions, replacements, accessions and attachments to any and all of the foregoing. Unless otherwise expressly provided in this Agreement, all references to “Oil and Gas Properties” refer to the right, title, and interest of the Loan Parties and their Subsidiaries in the Oil and Gas Properties.

“Operator” shall mean, with respect to the Oil and Gas Properties, Borrower, any of its Affiliates, and any other operators, including contract operators, of the Mortgaged Properties, and in each such case of an Affiliate or other operator, subject to Approval by the Administrative Agent (which Approval shall not unreasonably withheld or delayed).

“Organizational Documents” shall mean the certificate of incorporation and by-laws of a corporation; the certificate of limited partnership and agreement of limited partnership of a limited partnership; the partnership agreement of a general partnership; the certificate of formation and operating or comparable agreement of a limited liability company; and the comparable instruments for any other entity, including, with respect to a trust, any agreement or instrument creating such trust.

“OSHA” shall mean the Occupational Safety and Health Act of 1970, as amended from time to time, and any successor statute.

“Other Connection Taxes” shall mean, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).

“Other Taxes” shall mean all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment.

“Parent” shall mean Samson Oil & Gas Limited, an Australian corporation organized under the laws of Australia.

“Parent Company” shall mean, with respect to a Lender, the “bank holding company” as defined in Regulation Y, if any, of such Lender, and/or any Person owning, beneficially or of record, directly or indirectly, a majority of the shares of such Lender.

“Parent Guaranty Agreement” shall mean the Guaranty Agreement dated as of even date herewith made by the Parent in favor of the Administrative Agent for the benefit of the Lenders, as such agreement may be thereafter amended, restated, supplemented or otherwise modified from time to time.

“Participant” shall have the meaning set forth in Section 10.4(d).

“Participant Register” shall have the meaning set forth in Section 10.4(d).

“Patriot Act” shall mean the USA PATRIOT Improvement and Reauthorization Act of 2005 (Pub. L. 109-177 (signed into law March 9, 2006)), as amended and in effect from time to time.

“Payment Date” shall have the meaning set forth in Section 2.8.

“Payment Office” shall mean the office of the Administrative Agent located at 0 X. 00^xx Xxxxxx, 0^xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, or such other location as to which the Administrative Agent shall have given written notice to the Borrower and the other Lenders.

“PBGC” shall mean the U.S. Pension Benefit Guaranty Corporation referred to and defined in ERISA, and any successor entity performing similar functions.

“PDP” shall mean “proved developed producing oil and gas reserves” as such term is defined by the SPE in its standards and guidelines.

“PDNP” shall mean “proved developed nonproducing oil and gas reserves” as such term is defined by the SPE in its standards and guidelines.

“Permitted Investments” shall mean:

(i) direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States (or by any agency thereof to the extent such obligations are backed by the full faith and credit of the United States), in each case maturing within one year from the date of acquisition thereof;

(ii) commercial paper having the highest rating, at the time of acquisition thereof, of S&P or Xxxxx’x and in either case maturing within six months from the date of acquisition thereof;

(iii) certificates of deposit, bankers’ acceptances and time deposits maturing within 180 days of the date of acquisition thereof issued or guaranteed by or placed with, and money market deposit accounts issued or offered by, any domestic office of any commercial bank organized under the laws of the United States or any state thereof which has a combined capital and surplus and undivided profits of not less than $500,000,000;

(iv) fully collateralized repurchase agreements with a term of not more than 30 days for securities described in clause (i) above and entered into with a financial institution satisfying the criteria described in clause (iii) above; and

(v) mutual funds investing solely in any one or more of the Permitted Investments described in clauses (i) through (iv) above.

“Person” shall mean any individual, partnership, firm, corporation, association, joint venture, limited liability company, trust or other entity, or any Governmental Authority.

“Plan” shall mean any “employee benefit plan” as defined in Section 3 of ERISA (other than a Multiemployer Plan) maintained or contributed to by the Borrower or any ERISA Affiliate or to which the Borrower or any ERISA Affiliate has or may have an obligation to contribute, and each such plan that is subject to Title IV of ERISA for the five-year period immediately following the latest date on which the Borrower or any ERISA Affiliate maintained, contributed to or had an obligation to contribute to (or is deemed under Section 4069 of ERISA to have maintained or contributed to or to have had an obligation to contribute to, or otherwise to have liability with respect to) such plan.

“Prepayment Premium” shall have the meaning set forth in Section 2.12.

“Pro Forma Basis” shall mean, (i) with respect to any Person, business, property or asset acquired in an acquisition permitted under Section 7.4, the inclusion as “Consolidated EBITDAX” of the EBITDAX (i.e. net income before interest, taxes, depreciation and amortization) for such Person, business, property or asset as if such acquisition had been consummated on the first day of the applicable period, based on historical results accounted for in accordance with GAAP, and (ii) with respect to any Person, business, property or asset sold, transferred or otherwise disposed of, the exclusion from “Consolidated EBITDAX” of the EBITDAX (i.e. net income before interest, taxes, depreciation and amortization) for such Person, business, property or asset so disposed of during such period as if such disposition had been consummated on the first day of the applicable period, in accordance with GAAP.

“Pro Rata Share” shall mean with respect to any Commitment or Loan of any Lender at any time, a percentage, (a) on the Closing Date and immediately prior to the making of the initial Borrowing hereunder, numerator of which shall be such Lender’s Commitment, and the denominator of which shall be the sum of all Commitments of all Lenders and (b) from and after the making of the initial Borrowing hereunder on the Closing Date, the numerator of which shall be such Lender’s Credit Exposure and the denominator of which shall be the sum of all Credit Exposure of all Lenders.

“Property” shall mean any interest in any kind of property or asset, whether real, personal or mixed, or tangible or intangible, including, without limitation, cash, securities, accounts and contract rights.

“Prudent Operator” shall mean a reasonable, prudent operator experienced in the exploration and production of Hydrocarbons and who is, at the time of any specific determination, situated similarly to the applicable Loan Party, any additional mortgagor, or Operator, as applicable, in all material respects.

“PUD” shall mean “proved undeveloped oil and gas reserves” as such term is defined by the SPE in its standards and guidelines.

“Purchasers” shall mean all Persons who purchase Hydrocarbons attributable or allocable to a Loan Party’s Net Revenue Interest in the Mortgaged Properties; provided, however that upon an Event of Default, such Purchasers shall be Persons Approved by the Administrative Agent (such approval or disapproval not to be unreasonably delayed).

“Qualified ECP Guarantor” shall mean, in respect of any Hedging Transaction, each Loan Party that (i) has total assets exceeding $10,000,000 at the time any guaranty of obligations under such Hedging Transaction or grant of the relevant security interest becomes effective or (ii) otherwise constitutes an “eligible contract participant” under the Commodity Exchange Act or any regulations promulgated thereunder and can cause another Person to qualify as an “eligible contract participant” at such time by entering into a keepwell under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

“Recipient” shall mean, as applicable, (a) the Administrative Agent and (b) any Lender.

“Regulation D” shall mean Regulation D of the Board of Governors of the Federal Reserve System, as the same may be in effect from time to time, and any successor regulations.

“Regulation T” shall mean Regulation T of the Board of Governors of the Federal Reserve System, as the same may be in effect from time to time, and any successor regulations.

“Regulation U” shall mean Regulation U of the Board of Governors of the Federal Reserve System, as the same may be in effect from time to time, and any successor regulations.

“Regulation X” shall mean Regulation X of the Board of Governors of the Federal Reserve System, as the same may be in effect from time to time, and any successor regulations.

“Regulation Y” shall mean Regulation Y of the Board of Governors of the Federal Reserve System, as the same may be in effect from time to time, and any successor regulations.

“Related Costs” shall mean the reasonable and documented fees and out-of-pocket expenses of counsel for Administrative Agent, Lenders and consultants for Administrative Agent and Lenders and such other reasonable and documented out of pocket, third-party expenses incurred by Administrative Agent and Lenders in connection with the due diligence, negotiation and preparation of documents relating to the Term Loan and execution, delivery and filing and/or recording of the Loan Documents together with any amendments, supplements or modifications thereto or administration or enforcement thereof, including without limitation, any and all commitment fees, upfront fees, or other fees, costs or expenses paid or to be paid in accordance to the Administrative Agent or any Lender under the Loan Documents.

“Related Parties” shall mean, with respect to any specified Person, such Person’s Affiliates and the respective partners, directors, officers, employees, agents or advisors of such Person and such Person’s Affiliates.

“Release” shall have the meanings specified in CERCLA or under any other Environmental Law.

“Remedial Work” shall have the meaning assigned to such term in Section 5.17(a).

“Required Administrative Filings” shall have the meaning assigned to such term in Section 5.25(c)(i).

“Required Capital Reserve Amount” shall mean $1,000,000.

“Required Debt Service Reserve Amount” shall mean (a) on the Closing Date, $1,088,750, and (b) as of the last day of each Fiscal Quarter, the amount equal to the Debt Service due and payable under the Loan Documents during the immediately succeeding Fiscal Quarter.

“Requirement of Law” for any Person shall mean the articles or certificate of incorporation, bylaws, partnership certificate and agreement, or limited liability company certificate of organization and agreement, as the case may be, and other organizational and governing documents of such Person, and any law, treaty, rule or regulation, or determination of a Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.

“Reserve Account” means the “Account” which is located at Mutual of Omaha Bank and established under the Reserve Account Control Agreement.

“Reserve Account Control Agreement” means the Control Account Agreement dated on or about the date of this Agreement, among the Borrower, the Collateral Agent and Mutual of Omaha Bank that provides the Collateral Agent the exclusive right of access and control to all Accounts governed thereby.

“Reserve Report” shall mean a report, in form and substance reasonably satisfactory to the Administrative Agent, setting forth, as of the dates set forth in Section 5.13(a) or Section 5.13(b) (or such other date in the event of an Interim Asset Coverage Ratio Test Date) the oil and gas reserves attributable to the proved Oil and Gas Properties of the Loan Parties (or to be acquired by the Loan Parties) which are or are to be included in the Eligible Mortgaged Properties, together with (a) a projection of the rate of production of such proved Oil and Gas Properties, and (b) future net income, taxes, operating expenses and Capital Expenditures with respect thereto as of such date, based upon the Agreed Pricing (determined as of a date that is five (5) days prior to delivery of such report) and other pricing assumptions consistent with the SPE reporting requirements at the time and reflecting Hedging Transactions in place with respect to such production.

“Responsible Officer” shall mean (x) with respect to certifying compliance with the financial covenants set forth in Article VI, the chief financial officer or the treasurer of the Borrower and (y) with respect to all other provisions, any of the president, the chief executive officer, the chief operating officer, the chief financial officer, the treasurer or a vice president of the Borrower or such other representative of the Borrower as may be designated in writing by any one of the foregoing with the consent of the Administrative Agent.

“Restricted Payment” shall mean, for any Person, any dividend or distribution on any class of its Capital Stock, or any payment on account of, or set apart assets for a sinking or other analogous fund for, the purchase, redemption, retirement, defeasance or other acquisition of any shares of its Capital Stock, or any shares or securities representing any Indebtedness subordinated to the Obligations or any Guarantee thereof (except in each case as permitted by Section 7.1 hereof), or any options, warrants or other rights to purchase such Capital Stock or such Indebtedness, whether now or hereafter outstanding; provided, however, a Restricted Payment shall not include any payment-in-kind or similar non-cash distribution of Capital Stock pursuant to the terms of any preference Capital Stock of the Borrower.

“Royalty Interest” shall mean (a) an expense-free interest in any Oil and Gas Property retained by a mineral lessor in a Lease, (b) an overriding royalty in any Oil and Gas Property reserved by or conveyed to a Person, or (c) any other expense-free right to receive production or revenues from any Oil and Gas Property.

“S&P” shall mean Standard & Poor’s, a Standard & Poor’s Financial Services LLC business.

“Sanctioned Country” shall mean a country subject to a sanctions program identified on the list maintained by OFAC and available at xxxx://xxx.xxxxxxxx.xxx/xxxxxxxx-xxxxxx/xxxxxxxxx/Xxxxx/
default.aspx, or as otherwise published from time to time.

“Sanctioned Person” shall mean (i) a Person named on the list of “Specially Designated Nationals and Blocked Persons” maintained by OFAC available at xxxx://xxx.xxxxxxxx.xxx/xxxxxxxx-xxxxxx/xxxxxxxxx/XXX-Xxxx/Xxxxx/xxxxxxx.xxxx, or as otherwise published from time to time, or (ii) (A) an agency of the government of a Sanctioned Country, (B) an organization owned or controlled by a Sanctioned Country, or (C) a person located, organized or resident in a Sanctioned Country, to the extent subject to a sanctions program administered by OFAC.

“Secured Hedge Agreement” means any Hedging Transaction, whether entered into prior to, on or after the date hereof, between the Borrower or any Guarantor and any Secured Hedge Party, that is financially settled.

“Secured Hedge Party” means any Approved Counterparty (other than a Loan Party) that has become party to the Hedge Intercreditor Agreement, either by signing the Hedge Intercreditor Agreement directly or by entry into a joinder to the Hedge Intercreditor Agreement in accordance with the terms and conditions of the Hedge Intercreditor Agreement.

“Secured Hedging Obligations” means all amounts and other obligations owing to any Secured Hedge Party under any Secured Hedge Agreement.

“Secured Parties” shall mean the Administrative Agent, the Collateral Agent, the Lenders and the Secured Hedge Parties.

“Security Agreement” means (i) the Security Agreement, dated as of even date herewith, by and among the Parent, certain Subsidiary Loan Parties, and the Collateral Agent, for the benefit of the Secured Parties, and (ii) each other security agreement executed by a Loan Party in accordance with the terms hereunder in favor of the Collateral Agent, for the benefit of the Secured Parties, each made as security for the payment or performance of the Obligations and this Agreement, as any such agreement may be amended, modified, supplemented or restated from time to time.

“Solvent” shall mean, with respect to any Person on a particular date, that on such date (a) the fair value of the property of such Person is greater than the total amount of liabilities, including subordinated and contingent liabilities, of such Person; (b) the present fair saleable value of the assets of such Person is not less than the amount that will be required to pay the probable liability of such Person on its debts and liabilities, including subordinated and contingent liabilities as they become absolute and matured; (c) such Person does not intend to, and does not believe that it will, incur debts or liabilities beyond such Person’s ability to pay as such debts and liabilities mature; and (d) such Person is not engaged in a business or transaction, and is not about to engage in a business or transaction, for which such Person’s property would constitute an unreasonably small capital. The amount of contingent liabilities (such as litigation, guaranties and pension plan liabilities) at any time shall be computed as the amount that, in light of all the facts and circumstances existing at the time, represents the amount that would reasonably be expected to become an actual or matured liability as of that date.

“SPE” means the Society of Petroleum Engineers or any generally recognized successor thereto which is reasonably satisfactory to the Administrative Agent.

“Special Flood Hazard Area” shall mean an area that FEMA’s current flood maps indicate has at least a one percent (1%) chance of a flood equal to or exceeding the base flood elevation (a 100-year flood) in any given year.

“Subsidiary” shall mean, with respect to any Person (the “parent”) at any date, any corporation, partnership, joint venture, limited liability company, association or other entity the accounts of which would be consolidated with those of the parent in the parent’s consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date, as well as any other corporation, partnership, joint venture, limited liability company, association or other entity (i) of which securities or other ownership interests representing more than 50% of the equity or more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned, controlled or held, or (ii) that is, as of such date, otherwise controlled, by the parent or one or more subsidiaries of the parent or by the parent and one or more subsidiaries of the parent. Unless otherwise indicated, all references to “Subsidiary” hereunder shall mean a Subsidiary of the Borrower.

“Subsidiary Guaranty Agreement” shall mean the Guaranty Agreement dated as of even date herewith made by one of more Subsidiary Loan Parties in favor of the Administrative Agent for the benefit of the Lenders, as such agreement may be thereafter amended, restated, supplemented or otherwise modified or joined from time to time.

“Subsidiary Loan Party” shall mean any Subsidiary that executes or becomes a party to Guaranty Agreement or a Security Agreement in accordance with the terms herein.

“Supporting Documentation” shall mean a package containing data that is available to Borrower sufficient to support the cost estimate and the justification for the proposed Acquisition and Development Plan for such project, including but not limited to: (a) location, (b) completion zone, (c) lateral link, (d) costs, (e) timing, (f) Working Interest breakdown, (g) Net Revenue Interest breakdown, (h) the Operator, and (i) a location map.

“Swap Obligation” shall mean, with respect to any Guarantor, any obligation to pay or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of section 1a(47) of the Commodity Exchange Act.

“Taxes” shall mean any and all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

“Third-Party Monitor” shall mean either Purple Land Management or another independent third-party satisfactory to the Administrative Agent in its sole discretion.

“Trading with the Enemy Act” shall mean the Trading with the Enemy Act of the United States of America (50 U.S.C. App. §§ 1 et seq.), as amended and in effect from time to time.

“Transfer Letters” shall mean, collectively, the letters in lieu of transfer orders and direction letters in form and substance satisfactory to the Administrative Agent and executed by the Borrower or any other Loan Party executing a Mortgage.

“Triggering Event” shall mean (a) an Asset Sale, (b) an Event of Loss, and (c) the novation or assignment (unless novated or assigned to a counterparty with equal or better creditworthiness or that otherwise is an Approved Counterparty), unwinding or termination (unless replaced with positions or contracts no less advantageous to the Borrower or the Subsidiary party thereto), or amendment (if such amendment is materially adverse to the Borrower or the Subsidiary party thereto) of a hedge position or Hedging Transaction; provided that, in any of such cases, such event occurs after the Closing Date and results in the aggregate amount of Net Proceeds from all such events occurring after the Closing Date exceeding $100,000, calculated by reference to the greater of (i) the amounts payable to or by a Loan Party in connection therewith and (ii) in the case of Oil and Gas Properties, the Modified Proved NPV of such Oil and Gas Properties subject to such sale or disposition, and, in the case of Hedging Transactions, the value of such hedge position or Hedging Transaction subject to any such event, in each case, determined as of the most recent test of the Asset Coverage Ratio (or during the time period from the Closing Date to the first test of the Asset Coverage Ratio, since the Closing Date).

“Triggering Event Proceeds” shall have the meaning set forth in Section 2.13(a).

“Type”, when used in reference to a Loan or a Borrowing, refers to whether the rate of interest on such Loan, or on the Loans comprising such Borrowing, is determined by reference to the Adjusted LIBO Rate or the Base Rate.

“Unfunded Pension Liability” of any Plan shall mean the amount, if any, by which the value of the accumulated plan benefits under the Plan, determined on a plan termination basis in accordance with actuarial assumptions at such time consistent with those prescribed by the PBGC for purposes of Section 4044 of ERISA, exceeds the fair market value of all Plan assets allocable to such liabilities under Title IV of ERISA (excluding any accrued but unpaid contributions).

“Uniform Commercial Code” or “UCC” shall mean the Uniform Commercial Code as in effect from time to time in the State of Texas.

“United States” or “U.S.” shall mean the United States of America.

“Updated Acquisition and Development Plan” shall mean the revised comprehensive Acquisition and Development Plan, delivered in accordance with Section 5.1(k), detailing for a twelve-month period, all capital expenditures in connection with the acquisition and development of such Mortgaged Properties any other expenditures that have been Approved by the Majority Lenders, and which plan or plans shall provide for the description, timing and estimated costs of any and all alternate capital expenditure development projects (including the performance of seismic explorations) proposed on the Mortgaged Properties using all or any part of the proceeds of the Loans.

“U.S. Person” shall mean any Person that is a “United States person” as defined in Section 7701(a)(30) of the Code.

“U.S. Tax Compliance Certificate” shall have the meaning set forth in Section 2.21(g)(ii)(B)(iii).

“Well” shall mean any existing or future oil or gas well, salt water disposal well, injection well, water supply well or any other well located on or related to the Oil and Gas Properties, and any facility or equipment in addition to or replacement of any well.

“Withdrawal Liability” shall mean liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.

“Withholding Agent” shall mean the Borrower, any other Loan Party or the Administrative Agent, as applicable.

“Working Interest” shall mean the property interest which entitles its owner to explore and develop certain land for oil and gas production purposes, whether under an oil and gas lease or unit, a compulsory pooling order or otherwise.

“Write-Down and Conversion Powers” shall mean, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.

Section 1.2. Classifications of Loans and Borrowings. For purposes of this Agreement, Loans may be classified and referred to by Type (e.g. “Eurodollar Loan” or “Base Rate Loan”). Borrowings also may be classified and referred to by Type (e.g. “Eurodollar Borrowing”).

Section 1.3. Accounting Terms and Determination. Unless otherwise defined or specified herein, all accounting terms used herein shall be interpreted, all accounting determinations hereunder shall be made, and all financial statements required to be delivered hereunder shall be prepared, in accordance with GAAP as in effect from time to time, applied on a basis consistent with the most recent audited consolidated financial statement of the Parent delivered pursuant to Section 5.1(a); provided that if the Borrower notifies the Administrative Agent that the Borrower wishes to amend any covenant in Article VI to eliminate the effect of any change in GAAP on the operation of such covenant (or if the Administrative Agent notifies the Borrower that the Majority Lenders wish to amend Article VI for such purpose), then the Borrower’s compliance with such covenant shall be determined on the basis of GAAP in effect immediately before the relevant change in GAAP became effective, until either such notice is withdrawn or such covenant is amended in a manner satisfactory to the Borrower and the Majority Lenders. Notwithstanding any other provision contained herein, all terms of an accounting or financial nature used herein shall be construed, and all computations of amounts and ratios referred to herein shall be made, without giving effect to any election under Accounting Standards Codification Section 825-10 (or any other Financial Accounting Standard having a similar result or effect) to value any Indebtedness or other liabilities of any Loan Party or any Subsidiary of any Loan Party at “fair value”, as defined therein.

Section 1.4. Terms Generally. The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”. The word “will” shall be construed to have the same meaning and effect as the word “shall”. In the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including” and the word “to” means “to but excluding”. Unless the context requires otherwise (i) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as it was originally executed or as it may from time to time be amended, restated, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (ii) any reference herein to any Person shall be construed to include such Person’s successors and permitted assigns, (iii) the words “hereof”, “herein” and “hereunder” and words of similar import shall be construed to refer to this Agreement as a whole and not to any particular provision hereof, (iv) all references to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles, Sections, Exhibits and Schedules to this Agreement, (v) all references to a specific time shall be construed to refer to Central time (daylight or standard, as applicable), unless otherwise indicated, and (vi) any reference to any law shall include all statutory and regulatory provisions consolidating, amending, replacing or interpreting such law and any reference to any law or regulation shall, unless otherwise specified, refer to such law or regulation as amended, modified or supplemented from time to time. References to “proved” in respect of Oil and Gas Properties herein shall mean, at any particular time, Oil and Gas Properties classified as “Proved Reserves” as defined in the Definitions for Oil and Gas Reserves promulgated by the SPE as in effect at the time in question.

ARTICLE II

AMOUNT AND TERMS OF THE COMMITMENTS

Section 2.1. General Description of Facility; Termination of Commitments. Subject to and upon the terms and conditions herein set forth, each of the Lenders hereby severally agrees (to the extent of such Lender’s Commitment) to make a Loan to the Borrower in accordance with Section 2.2 on the Closing Date; provided that in no event shall the aggregate principal amount of all outstanding Loans exceed the Aggregate Commitment Amount. Following the extension of the Loan made on the Closing Date, each Lender’s Commitment shall terminate and no additional Loans or other extensions of credit by the Lenders may be requested by the Borrower under this Agreement.

Section 2.2. Loans. Subject to the terms and conditions set forth herein, each Lender severally agrees to make a Loan, ratably in proportion to its Pro Rata Share of the Aggregate Commitments, to the Borrower on the Closing Date, in an aggregate principal amount that will not result in (a) such Lender’s Credit Exposure exceeding such Lender’s Commitment or (b) the aggregate Credit Exposures of all Lenders exceeding the Aggregate Commitment Amount.

Section 2.3. Acquisition and Development Plan.

(a) The initial Acquisition and Development Plan is attached as Schedule 2.3 (the “Initial Acquisition and Development Plan”) and is hereby Approved by the Administrative Agent. Such Initial Acquisition and Development Plan shall be updated annually (each an “Updated Acquisition and Development Plan”) and delivered to the Administrative Agent for Approval on or before October 1 of each calendar year. The Borrower may propose modifications to any Acquisition and Development Plan from time to time, and those modifications will become effective when Approved by the Majority Lenders, in their sole and absolute discretion.

(b) Except as permitted in Section 6.6, Borrower must seek Approval of the Administrative Agent before proceeding with respect to any change or modification to the then-effective Approved Acquisition and Development Plan, including to any project, Well, development or other activity listed thereon.

Section 2.4. Procedure for Borrowing. Subject to and upon the terms and conditions herein set forth, the Administrative Agent shall fund the entire amount of each Lender’s Commitment on the Closing Date.

Section 2.5. Reserved.

Section 2.6. Reserved.

Section 2.7. Reserved.

Section 2.8. Repayment of Loans. Commencing with the fiscal month ending September 30, 2020, the Borrower shall make monthly principal payments no later than two (2) Business Days prior to the last Business Day of each month (each a “Payment Date”) on the Loans in an amount equal to monthly installments calculated on the basis of monthly straight-line amortization. Borrower shall pay on the Maturity Date the outstanding principal amount of all Loans together with accrued and unpaid interest thereon and any other Obligations.

Section 2.9. Cash Management Prior to an Event of Default.

(a) Borrower shall (and shall direct each Loan Party to) direct and cause each Operator, all Purchasers of Hydrocarbons and all other marketers, customers and obligors of Borrower and each other Loan Party (including all payors of Royalty Interests, net profit interests, and production payment interests and payments under any Hedging Transaction) to deposit all payments of any nature due and owing to Borrower or such other Loan Party into one or more deposit accounts of the Borrower or such Loan Party at a depositary bank (each a “Lockbox Account”, and collectively the “Lockbox Accounts”) that is subject to a blocked Control Account Agreement in favor of the Administrative Agent.

(b) So long as no Event of Default has occurred and is continuing, funds from the Lockbox Accounts shall be applied on each Payment Date or such other day as Approved by the Administrative Agent as follows:

(i) First, to make Royalty Interest payments due and owing to any Governmental Authority;

(ii) Second, to make Royalty Interest payments due and owing to any third parties;

(iii) Third, to pay principal and interest on the Obligations and other Obligations then due and owing;

(iv) Fourth, to fund the Required Debt Service Reserve Amount in the Reserve Account;

(v) Fifth, to fund an amount necessary to maintain the Required Capital Reserve Amount in the Reserve Account; and

(vi) Sixth, any remainder to Borrower’s operating account, which account shall be subject to a springing Control Account Agreement, for general working capital and other purposes not prohibited by this Agreement (collectively, the “Lockbox Account Waterfall”).

Section 2.10. Cash Management After an Event of Default. After the occurrence and during the continuation of an Event of Default and thereafter until all monetary Obligations have been paid in full in cash,

(a) the Borrower and each other Loan Party hereby irrevocably authorizes the Administrative Agent to, with prior written notice to the Borrower, debit the Lockbox Accounts for the payment of all Obligations when due. On each Payment Date, the Administrative Agent shall apply funds credited to the Lockbox Accounts against all then due and unpaid Obligations. Except as provided in Section 2.10(b), Administrative Agent may, if an Event of Default exists, apply all funds credited to the Lockbox Accounts against any Obligations then outstanding.

(b) Following its delivery of each monthly operating statement to Administrative Agent, Borrower may, not more than six (6) times each month and on at least three (3) Business Days’ written notice to Administrative Agent, request Administrative Agent pay from funds credited to the Lockbox Accounts since the preceding Payment Date the items set forth below:

(i) (A) Related Costs; (B) costs and expenses associated with the operation of the Xxxxx in a manner consistent with the Approved Budget and the Approved Acquisition and Development Plan; (C) production taxes; (D) G&A Expenses not to exceed the lesser of (x) $2,750,000 in the aggregate in during any fiscal year and (y) the amount therefor set forth in the Approved Budget; (E) payments made with respect to Hedging Transactions (if applicable); and (D) other cash utilization Approved by the Majority Lenders; and

(ii) any other payments Approved by the Administrative Agent.

Borrower’s request for payment under this Section 2.10(b) will include Supporting Documentation reasonably satisfactory to Administrative Agent, including Borrower’s or the applicable Loan Party’s monthly joint interest billing invoices and revenue distribution statements. Unless Administrative Agent notifies Borrower in writing within three (3) Business Days of such request that it objects or requires additional information with respect to the requested payment (in which case, Administrative Agent will describe the objection or requested information in reasonable detail), then Administrative Agent will process the payment and directly pay such items set forth in the payment request from funds from the Lockbox Accounts.

(iii) Amounts deposited into the Lockbox Accounts and owing to (i) Working Interest and Royalty Interest owners that are not Affiliates of Borrower, or (ii) Governmental Authorities for Taxes or payments measured by production will be released by Administrative Agent to Borrower or the applicable Loan Party upon receipt of a certificate from Borrower detailing the amounts and the party to be paid. Administrative Agent will, at its option and upon prior written notice to Borrower, have the right (but not the obligation) to make payments directly to the Persons identified on Borrower’s certificate.

(c) Upon the occurrence of an Event of Default under Section 8.1(g), (h) or (i), the Administrative Agent shall be authorized, in its sole and absolute discretion, to sweep all funds located in the Reserve Account and apply the same against the Obligations.

Section 2.11. Evidence of Indebtedness.

(a) Each Lender shall maintain in accordance with its usual practice appropriate records evidencing the Indebtedness of the Borrower to such Lender resulting from each Loan made by such Lender from time to time, including the amounts of principal and interest payable thereon and paid to such Lender from time to time under this Agreement. The Administrative Agent shall maintain appropriate records in which shall be recorded (i) the Commitment and Maximum Commitment of each Lender, (ii) the amount of each Loan made hereunder by each Lender, the Type thereof and, in the case of each Eurodollar Loan, the Interest Period applicable thereto, (iii) the date and amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder in respect of the Loans and (iv) both the date and amount of any sum received by the Administrative Agent hereunder from the Borrower in respect of the Loans and each Lender’s Pro Rata Share thereof. The entries made in such records shall be prima facie evidence of the existence and amounts of the obligations of the Borrower therein recorded; provided that the failure or delay of any Lender or the Administrative Agent in maintaining or making entries into any such record or any error therein shall not in any manner affect the obligation of the Borrower to repay the Loans (both principal and unpaid accrued interest) of such Lender in accordance with the terms of this Agreement.

(b) This Agreement evidences the obligation of the Borrower to repay the Loans and is being executed as a “noteless” credit agreement. However, at the request of any Lender at any time, the Borrower agrees that it will prepare, execute and deliver to such Lender one original promissory note payable to the order of such Lender in a form substantially similar to Exhibit B attached hereto. Thereafter, the Loans evidenced by such promissory note and interest thereon shall at all times (including after assignment permitted hereunder) be represented by such promissory note in such form payable to the order of the payee named therein (or, if such promissory note is a registered note, to such payee and its registered assigns).

Section 2.12. Optional Prepayments. The Borrower shall have the right from time to time to request to prepay any Borrowing, in whole or in part, by giving written notice (or telephonic notice promptly confirmed in writing) to the Administrative Agent no later than 11:00 a.m. not less than five (5) Business Days prior to the proposed date of such prepayment. Each such notice shall be irrevocable and shall specify the proposed date of such prepayment and the principal amount of each Borrowing or portion thereof to be prepaid. Upon receipt of any such notice, the Administrative Agent shall promptly notify each affected Lender of the contents thereof and of such Lender’s Pro Rata Share of any such prepayment including Prepayment Premium. If such notice is given, the aggregate amount specified in such notice along with the Prepayment Premium shall be due and payable on the date designated in such notice, together with accrued interest to such date on the amount so prepaid in accordance with Section 2.14(c); provided that if a Eurodollar Borrowing is prepaid on a date other than the last day of an Interest Period applicable thereto, the Borrower shall also pay all amounts required pursuant to Section 2.20. Each optional prepayment of a Borrowing shall be in a minimum amount not less than $50,000 and in multiple integrals of $50,000 in excess thereof. Each prepayment of a Borrowing shall be applied to the Borrowings in inverse order of maturity and ratably to the Loans comprising such Borrowing.

As used herein, “Prepayment Premium” means, for each determination at the time of an optional prepayment, an amount equal to the aggregate amount of the Loans to be prepaid multiplied by the applicable percentage set forth in the below schedule:

Months after Closing Date	Percentage
1-12		4	%
13-24		3	%
25-36		2	%
37-60		0	%

Section 2.13. Mandatory Prepayments.

(a) If Borrower or any Subsidiary receives Net Proceeds in respect of any Triggering Event (“Triggering Event Proceeds”), the Borrower or such Subsidiary shall prepay the Loans in an aggregate principal amount equal to the following:

(i) the Triggering Event Proceeds plus the applicable Prepayment Premium within five (5) Business Days of Borrower’s (or such Subsidiary’s, as applicable) receipt of such Triggering Event Proceeds for an occurrence under clauses (a) or (c) of a Triggering Event; and

(ii) the Triggering Event Proceeds with respect to a Triggering Event under clause (b) of such definition relating to proceeds retained for the repair or reconstruction of damaged Property, within five (5) Business Days of the earlier of (y) the date that is 120 days after Borrower’s (or such Subsidiary’s, as applicable) receipt of such Triggering Event Proceeds, except to the extent that the Borrower (or such Subsidiary, as applicable) has actually applied such Triggering Event to the repair or reconstruction of the damaged Property, and (z) the date on which Borrower or the applicable Subsidiary elects not to proceed with the applicable repair or reconstruction; provided, however, that the Prepayment Premium shall not be applied to the first $1,000,000 of such insurance proceeds used to repay the Loans.

(b) Any prepayments made by the Borrower pursuant to this Section shall be applied as follows: first, to the Administrative Agent’s fees and reimbursable expenses then due and payable pursuant to any of the Loan Documents; second, to interest and fees then due and payable hereunder, pro rata to the Lenders based on their respective pro rata shares of such interest and fees; third, to the principal balance of the Loans specified by the Borrower, pro rata to the Lenders based on their respective Commitments; provided, however, that the foregoing shall not be interpreted to (x) cause any of the foregoing interest, fees or expenses to be due and payable unless already due and payable pursuant to other provisions of the Loan Documents and such interest, fees and expenses shall continue to be required to be paid on such date that each are otherwise due and payable or (y) eliminate or reduce the three (3) Business Days grace period with respect to an Event of Default under Section 8.1(b).

Section 2.14. Interest on Loans.

(a) The Borrower shall pay interest on each Eurodollar Loan at the Adjusted LIBO Rate plus the Applicable Margin; provided, however, if Eurodollar Loans are unavailable, then Borrower shall pay interest on each Loan at the Base Rate plus the Applicable Margin.

(b) Notwithstanding subsection (a) of this Section, at the option of the Majority Lenders if an Event of Default has occurred and is continuing, and automatically after acceleration following an Event of Default (including an acceleration following an Event of Default pursuant to Section 8.1(g), Section 8.1(h) or Section 8.1(i)), the Borrower shall pay interest (“Default Interest”) with respect to all Eurodollar Loans at the rate per annum equal to 200 basis points above the otherwise applicable interest rate for such Loans for the then current Interest Period.

(c) Interest on the principal amount of all Loans shall accrue from and including the date such Loans are made to but excluding the date of any repayment thereof. Interest on all outstanding Loans shall be payable on the last day of each Interest Period applicable thereto, and on the Maturity Date. Interest on any Loan which is converted into a Loan of another Type or which is repaid or prepaid shall be payable on the date of such conversion or on the date of any such repayment or prepayment (on the amount repaid or prepaid) thereof. All Default Interest shall be payable on demand.

(d) The Administrative Agent shall determine each interest rate applicable to the Loans in accordance with the terms hereof and shall promptly notify the Borrower and the Lenders of such rate in writing (or by telephone, promptly confirmed in writing). Any such determination shall be conclusive and binding for all purposes, absent manifest error.

Section 2.15. Fees. The Borrower shall pay to the Administrative Agent for its own account fees in the amounts and at the times previously agreed upon in writing by the Borrower and the Administrative Agent.

Section 2.16. Computation of Interest and Fees. All interest and all fees hereunder shall be computed on the basis of a year of 360 days and paid for the actual number of days elapsed (including the first day but excluding the last day). Each determination by the Administrative Agent of an interest rate or fee hereunder shall be made in good faith and, except for manifest error, shall be final, conclusive and binding for all purposes.

Section 2.17. Inability to Determine Interest Rates. If, prior to the commencement of any Interest Period for any Eurodollar Borrowing:

(i) the Administrative Agent shall have determined (which determination shall be conclusive and binding upon the Borrower) that, by reason of circumstances affecting the relevant interbank market, adequate means do not exist for ascertaining the Adjusted LIBO Rate for such Interest Period, or

(ii) the Administrative Agent shall have received notice from the Majority Lenders that the Adjusted LIBO Rate does not adequately and fairly reflect the cost to such Lenders of making, funding or maintaining their Eurodollar Loans for such Interest Period,

the Administrative Agent shall give written notice (or telephonic notice, promptly confirmed in writing) to the Borrower and to the Lenders as soon as practicable thereafter. Until the Administrative Agent shall notify the Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, (i) the obligations of the Lenders to make Eurodollar Loans or to continue or convert outstanding Loans as or into Eurodollar Loans shall be suspended and (ii) all such affected Loans shall be converted into Base Rate Loans on the last day of the then current Interest Period applicable thereto unless the Borrower prepays such Loans in accordance with this Agreement.

Section 2.18. Illegality. If any Change in Law shall make it unlawful or impossible for any Lender to perform any of its obligations hereunder or make, maintain or fund any Eurodollar Loan and such Lender shall so notify the Administrative Agent, the Administrative Agent shall promptly give notice thereof to the Borrower and the other Lenders, whereupon until such Lender notifies the Administrative Agent and the Borrower that the circumstances giving rise to such suspension no longer exist, the obligation of such Lender to make Eurodollar Loans, or to continue or convert outstanding Loans as or into Eurodollar Loans, shall be suspended. In the case of the making of a Eurodollar Borrowing, such Lender’s Loan shall be made as a Base Rate Loan as part of the same Borrowing for the same Interest Period and, if the affected Eurodollar Loan is then outstanding, such Loan shall be converted to a Base Rate Loan either (i) on the last day of the then current Interest Period applicable to such Eurodollar Loan if such Lender may lawfully continue to maintain such Loan to such date or (ii) immediately if such Lender shall determine that it may not lawfully continue to maintain such Eurodollar Loan to such date. Notwithstanding the foregoing, the affected Lender shall, prior to giving such notice to the Administrative Agent, designate a different Applicable Lending Office if such designation would avoid the need for giving such notice and if such designation would not otherwise be disadvantageous to such Lender in the good faith exercise of its discretion.

Section 2.19. Increased Costs.

(a) If any Change in Law shall:

(i) impose, modify or deem applicable any reserve, special deposit or similar requirement that is not otherwise included in the determination of the Adjusted LIBO Rate hereunder against assets of, deposits with or for the account of, or credit extended by, any Lender (except any such reserve requirement reflected in the Adjusted LIBO Rate); or

(ii) subject any Recipient to any Taxes (other than (A) Indemnified Taxes, (B) Taxes described in clauses (b) through (d) of the definition of Excluded Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto; or

(iii) impose on any Lender or the eurodollar interbank market any other condition, cost or expense (other than Taxes) affecting this Agreement or any Eurodollar Loans made by such Lender or any participation therein;

and the result of any of the foregoing is to increase the cost to such Lender of making, converting into, continuing or maintaining any Eurodollar Loan or of maintaining its obligation to make any such Loan or to increase the cost to such Lender of participating in or to reduce the amount received or receivable by such Lender hereunder (whether of principal, interest or any other amount),

then, from time to time, such Lender may provide the Borrower (with a copy thereof to the Administrative Agent) with written notice and demand, in the form set forth in Section 2.19(c), with respect to such increased costs or reduced amounts, and within five (5) Business Days after receipt of such notice and demand the Borrower shall pay to such Lender such additional amounts as will compensate such Lender for any such additional or increased costs incurred or reduction suffered; provided that the Borrower shall not be liable for such compensation if the relevant Change in Law occurs on a date prior to the date such Lender becomes party hereto.

(b) If any Lender shall have determined that on or after the date of this Agreement any Change in Law regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Lender’s capital (or on the capital of the Parent Company of such Lender) as a consequence of its obligations hereunder to a level below that which such Lender or such Parent Company could have achieved but for such Change in Law (taking into consideration such Lender’s policies or the policies of such Parent Company with respect to capital adequacy and liquidity), then, from time to time, such Lender may provide the Borrower (with a copy thereof to the Administrative Agent) with written notice and demand with respect to such reduced amounts, and within five (5) Business Days after receipt of the certificate provided in Section 2.19(c), the Borrower shall pay to such Lender, as the case may be, such additional amounts as will compensate such Lender or such Parent Company for any such reduction suffered.

(c) A certificate of such Lender setting forth the amount or amounts necessary to compensate such Lender or the Parent Company of such Lender, as the case may be, specified in subsection (a) or (b) of this Section shall be delivered to the Borrower (with a copy to the Administrative Agent) and shall be conclusive, absent manifest error.

(d) Failure or delay on the part of any Lender to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s right to demand such compensation; provided that Borrower shall not be required to compensate a Lender pursuant to this Section 2.19 for any increased costs or reductions incurred more than 365 days prior to the date that such Lender notifies Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s intention to claim compensation therefor.

Section 2.20. Funding Indemnity. In the event of (a) the payment of any principal of a Eurodollar Loan other than on the last day of the Interest Period applicable thereto (including as a result of an Event of Default), (b) the conversion or continuation of a Eurodollar Loan other than on the last day of the Interest Period applicable thereto, or (c) the failure by the Borrower to borrow, prepay, convert or continue any Eurodollar Loan on the date specified in any applicable notice delivered by the Borrower pursuant to this Agreement (regardless of whether such notice is withdrawn or revoked), then, in any such event, within five (5) Business Days following receipt of the certificate set forth in this Section 2.20 by the Borrower, the Borrower shall compensate each Lender for the loss, cost or expense incurred by it attributable to such event. In the case of a Eurodollar Loan, such loss, cost or expense shall be deemed to include an amount determined by such Lender to be the excess, if any, of (A) the amount of interest that would have accrued on the prepaid principal amount of such Eurodollar Loan if such event had not occurred at the Adjusted LIBO Rate applicable to such Eurodollar Loan for the period from the date of such event to the last day of the then current Interest Period therefor (or, in the case of a failure to borrow, convert or continue, for the period that would have been the Interest Period for such Eurodollar Loan) over (B) the amount of interest that would accrue on the principal amount of such Eurodollar Loan for the same period if the Adjusted LIBO Rate were set on the date such Eurodollar Loan was prepaid or converted or the date on which the Borrower failed to borrow, convert or continue such Eurodollar Loan. A certificate as to any additional amount payable under this Section submitted to the Borrower by any Lender (with a copy to the Administrative Agent) shall be conclusive, absent manifest error.

Section 2.21. Taxes.

(a) Defined Terms. For purposes of this Section 2.21, the term “applicable law” includes FATCA.

(b) Payments Free of Taxes. Any and all payments by or on account of any obligation of any Loan Party under any Loan Document shall be made without deduction or withholding for any Taxes, except as required by applicable law. If any applicable law (as determined in the good faith discretion of an applicable Withholding Agent) requires the deduction or withholding of any Tax from any such payment by a Withholding Agent, then the applicable Withholding Agent shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law and, if such Tax is an Indemnified Tax, then the sum payable by the applicable Loan Party shall be increased as necessary so that after such deduction or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section) the applicable Recipient receives an amount equal to the sum it would have received had no such deduction or withholding been made.

(c) Payment of Other Taxes by the Borrower. The Borrower shall timely pay to the relevant Governmental Authority in accordance with applicable law, or at the option of the Administrative Agent timely reimburse it for the payment of, any Other Taxes.

(d) Indemnification by the Borrower. The Borrower shall indemnify each Recipient, within 10 days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section) payable or paid by such Recipient or required to be withheld or deducted from a payment to such Recipient and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrower by a Lender (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error.

(e) Indemnification by the Lenders. Each Lender shall severally indemnify the Administrative Agent, within 10 days after demand therefor, for (i) any Indemnified Taxes attributable to such Lender (but only to the extent that the Borrower has not already indemnified the Administrative Agent for such Indemnified Taxes and without limiting the obligation of the Borrower to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 10.4(d) relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by the Administrative Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by the Administrative Agent to the Lender from any other source against any amount due to the Administrative Agent under this paragraph (e).

(f) Evidence of Payments. As soon as practicable after any payment of Taxes by the Borrower or any other Loan Party to a Governmental Authority pursuant to this Section 2.21, the Borrower or other Loan Party shall, upon written request by the Administrative Agent, deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.

(g) Status of Lenders. (i) Any Lender that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Loan Document shall deliver to the Borrower and the Administrative Agent, at the time or times reasonably requested by the Borrower or the Administrative Agent, such properly completed and executed documentation reasonably requested by the Borrower or the Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Lender, if reasonably requested by the Borrower or the Administrative Agent, shall deliver such other documentation prescribed by applicable law or reasonably requested by the Borrower or the Administrative Agent as will enable the Borrower or the Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Section 2.21(g)(ii)(A), (ii)(B) and (ii)(D) below) shall not be required if in the Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.

(ii) Without limiting the generality of the foregoing,

(A) any Lender that is a U.S. Person shall deliver to the Borrower and the Administrative Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed originals of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding tax;

(B) any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), whichever of the following is applicable:

(i) in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, executed originals of IRS Form W-8BEN or IRS Form W-8BEN-E establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN or IRS Form W-8BEN-E establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;

(ii) executed originals of IRS Form W-8ECI;

(iii) in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate substantially in the form of Exhibit 2.19A to the effect that such Foreign Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10 percent shareholder” of the Borrower within the meaning of Section 881(c)(3)(B) of the Code, or a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and (y) executed originals of IRS Form W-8BEN; or

(iv) to the extent a Foreign Lender is not the beneficial owner, executed originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN or IRS Form W-8BEN-E, a U.S. Tax Compliance Certificate substantially in the form of Exhibit 2.19B or Exhibit 2.19C, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate substantially in the form of Exhibit 2.19D on behalf of each such direct and indirect partner;

(C) any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed originals of any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable law to permit the Borrower or the Administrative Agent to determine the withholding or deduction required to be made; and

(D) if a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Borrower and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by the Borrower or the Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower or the Administrative Agent as may be necessary for the Borrower and the Administrative Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (D), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

Each Lender agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Borrower and the Administrative Agent in writing of its legal inability to do so.

(h) Treatment of Certain Refunds. If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 2.21 (including by the payment of additional amounts pursuant to this Section 2.21), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this paragraph (h) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this paragraph (h), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this paragraph (h) the payment of which would place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid. This paragraph shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person. For purposes of this paragraph (h), a refund includes any credit with respect to a Tax in lieu of a refund.

(i) Administrative Agent Documentation. On or before the date that the Administrative Agent (or any successor or replacement Administrative Agent) becomes the Administrative Agent hereunder, it shall deliver to the Borrower two copies of either (i) IRS Form W-9, or (ii) if the Administrative Agent is not a U.S. person, (A) an IRS Form W-8ECI with respect to amounts it receives on its own account, (B) an Internal Revenue Service Form W-8IMY, as revised certifying that the payments it receives for the account of others are not effectively connected with the conduct of a trade or business in the United States, or (C) such other forms or documentation as will establish that it is exempt from U.S. withholding Taxes, including Taxes imposed by FATCA.

(j) Survival. Each party’s obligations under this Section 2.21 shall survive the resignation or replacement of the Administrative Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Document.

Section 2.22. Payments Generally; Pro Rata Treatment; Sharing of Set-offs.

(a) The Borrower shall make each payment required to be made by it hereunder (whether of principal, interest or fees, or of amounts payable under Section 2.19, 2.18 or 2.19, or otherwise) prior to 12:00 noon on the date when due, in immediately available funds, free and clear of any defenses, rights of set-off, counterclaim, or withholding or deduction of taxes. Any amounts received after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon. All such payments shall be made to the Administrative Agent at the Payment Office, except that payments pursuant to Sections 2.17, 2.18, 2.19 and 10.3 shall be made directly to the Persons entitled thereto. The Administrative Agent shall distribute any such payments received by it for the account of any other Person to the appropriate recipient promptly following receipt thereof. If any payment hereunder shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be made payable for the period of such extension. All payments hereunder shall be made in Dollars.

(b) If at any time insufficient funds are received by and available to the Administrative Agent to pay fully all amounts of principal, interest and fees then due hereunder, such funds shall be applied as follows: first, to all fees and reimbursable expenses of the Administrative Agent then due and payable pursuant to any of the Loan Documents; second, to all reimbursable expenses of the Lenders then due and payable pursuant to any of the Loan Documents, pro rata to the Lenders based on their respective pro rata shares of such fees and expenses; third, to all interest and fees then due and payable hereunder, pro rata to the Lenders based on their respective pro rata shares of such interest and fees; and fourth, to all principal of the Loans then due and payable hereunder, pro rata to the parties entitled thereto based on their respective pro rata shares of such principal.

(c) If any Lender shall, by exercising any right of set-off or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of its Loans that would result in such Lender receiving payment of a greater proportion of the aggregate amount of its Credit Exposure and accrued interest and fees thereon than the pro rata proportion received by any other Lender with respect to its Credit Exposure, then the Lender receiving such greater proportion shall notify the Administrative Agent of such fact and purchase (for cash at face value) participations in the Credit Exposure of other Lenders to the extent necessary so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Credit Exposure; provided that (i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest, and (ii) the provisions of this subsection shall not be construed to apply to any payment made by the Borrower pursuant to and in accordance with the express terms of this Agreement (including the application of funds arising from the existence of a Defaulting Lender) or any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Credit Exposure to any assignee or participant, other than to the Borrower or any Subsidiary or Affiliate thereof (as to which the provisions of this subsection shall apply). The Borrower consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against the Borrower rights of set-off and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of the Borrower in the amount of such participation.

(d) Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders, the amount or amounts due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation.

Section 2.23. Mitigation of Obligations. If any Lender requests compensation under Section 2.19, or if the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.21, then such Lender shall use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the sole judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable under Section 2.19 or Section 2.21, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The Borrower hereby agrees to pay all costs and expenses incurred by any Lender in connection with such designation or assignment.

Section 2.24. Defaulting Lenders.

(a) Defaulting Lender Adjustments. Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as such Lender is no longer a Defaulting Lender, to the extent permitted by applicable law:

(i) Such Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in the definition of Majority Lenders and in Section 10.2.

(ii) Any payment of principal, interest, fees or other amounts received by the Administrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article VIII or otherwise) or received by the Administrative Agent from a Defaulting Lender pursuant to Section 10.7 shall be applied at such time or times as may be determined by the Administrative Agent as follows: first, to the payment of any amounts owing by such Defaulting Lender to the Administrative Agent hereunder; second, as the Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent; third, if so determined by the Administrative Agent and the Borrower, to be held in a deposit account and released pro rata in order to satisfy such Defaulting Lender’s potential future funding obligations with respect to Loans under this Agreement; fourth, to the payment of any amounts owing to the Lenders as a result of any judgment of a court of competent jurisdiction obtained by any Lender against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; fifth, so long as no Default or Event of Default exists, to the payment of any amounts owing to the Borrower as a result of any judgment of a court of competent jurisdiction obtained by the Borrower against such Defaulting Lender as a result of such Defaulting Lender's breach of its obligations under this Agreement; and sixth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if (x) such payment is a payment of the principal amount of any Loans in respect of which such Defaulting Lender has not fully funded its appropriate share, and (y) such Loans were made at a time when the conditions set forth in Section 3.1 were satisfied or waived, such payment shall be applied solely to pay the Loans of all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of such Defaulting Lender until such time as all Loans are funded by the Lenders pro rata in accordance with their Commitments without giving effect to sub-section (iv) below. Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.

(b) Defaulting Lender Cure. If the Borrower, the Administrative Agent agree in writing that a Lender is no longer a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any cash collateral), that Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause the Loans to be held pro rata by the Lenders in accordance with the applicable Commitments, whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.

ARTICLE III

CONDITIONS PRECEDENT TO LOANS

Section 3.1. Conditions to Effectiveness. The obligations of the Lenders to make the initial Loan hereunder shall not become effective until the date on which each of the following conditions is satisfied (or waived in accordance with Section 10.2):

(a) The Administrative Agent shall have received payment of all fees, expenses and other amounts due and payable on or prior to the Closing Date by Section 2.15 and Section 10.3 or any other provision of a Loan Document.

(b) The Administrative Agent (or its counsel) shall have received the following, each to be in form and substance satisfactory to the Administrative Agent:

(i) a counterpart of this Agreement signed by or on behalf of each party hereto or written evidence satisfactory to the Administrative Agent (which may include telecopy transmission of a signed signature page of this Agreement) that such party has signed a counterpart of this Agreement;

(ii) a certificate of a Responsible Officer of each Loan Party dated as of the Closing Date, attaching and certifying copies of its bylaws, or partnership agreement or limited liability company agreement, and of the resolutions of its board of directors or other equivalent governing body, or comparable organizational documents and authorizations, authorizing the execution, delivery and performance of the Loan Documents to which it is a party and certifying the name, title and true signature of each officer of such Loan Party executing the Loan Documents to which it is a party;

(iii) certified copies of the articles or certificate of incorporation, certificate of organization or limited partnership, or other registered organizational documents of each Loan Party, together with certificates of good standing or existence, as may be available from the Secretary of State of the jurisdiction of organization of such Loan Party and each other jurisdiction where such Loan Party is required to be qualified to do business as a foreign corporation, each dated as of a recent date;

(iv) a favorable written opinions of Xxxxx Xxxxxx & Xxxxxx, as New York, Colorado, North Dakota, and Wyoming counsel, Xxxxxxx Xxxxx PLLP, as Montana local counsel, and Xxxxxx Xxxxxxx Xxxxxx Xxxxx (AU), as Australian local counsel, counsel to the Loan Parties, dated as of the Closing Date addressed to the Administrative Agent and each of the Lenders, and covering such matters relating to the Loan Parties, the Loan Documents and the transactions contemplated therein as the Administrative Agent or the Majority Lenders shall reasonably request (which opinions will expressly permit reliance by permitted successors and assigns of the Administrative Agent and the Lenders);

(v) a certificate dated the Closing Date and signed by a Responsible Officer, certifying that after giving effect to the funding of any initial Borrowing, (A) no Default or Event of Default has occurred and is continuing, (B) all representations and warranties of each Loan Party set forth in the Loan Documents are true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) on such date, except that any representation and warranty which by its terms is made as of a specified date shall be required to be true and correct in all material respects only as of such specified date, (C) since June 30, 2018, there shall have been no Material Adverse Effect, and (D) attaching a list setting forth those unpaid and owing royalty payments and payments owing to trade creditors to be paid as of the Closing Date;

(vi) a duly executed Notice of Borrowing for any initial Borrowing;

(vii) a certificate dated the Closing Date and signed by a Responsible Officer, (A) certifying that (1) all consents, approvals, authorizations, registrations and filings and orders (“Consents”) as of the Closing Date required to be made or obtained under any Requirement of Law, or by any Contractual Obligation of any Loan Party, in connection with the execution, delivery, or performance by the Loan Parties of the Loan Documents or any of the transactions contemplated thereby have been obtained, (2) such Consents, are in full force and effect and all applicable waiting periods have expired, and no investigation or inquiry by any governmental authority regarding the Commitments or any transaction being financed with the proceeds thereof, which would impose adverse conditions on the Agreement, is, to the knowledge of the Borrower, ongoing and (3) attached thereto is a true and correct copy of all such Consents or (B) certifying that no such Consents are required;

(viii) copies of (A) the internally prepared quarterly financial statements of the Parent and its Subsidiaries on a consolidated basis for the Fiscal Quarter ended December 31, 2018 in form and substance reasonably acceptable to the Administrative Agent (together with any supporting data reasonably requested by the Administrative Agent) and (B) the audited consolidated financial statements for the Parent and its Subsidiaries for the Fiscal Year ended June 30, 2018;

(ix) a certificate, dated the Closing Date and signed by the chief financial officer of each Loan Party, confirming that the Parent is Solvent, the Borrower is Solvent, and the Loan Parties, taken as a whole, are Solvent, in each case before and after giving effect to the funding of any initial Borrowing and the consummation of the transactions contemplated to occur on the Closing Date;

(x) the Guaranty Agreements, duly executed by the Parent and each Subsidiary Loan Party;

(xi) the Security Agreement, duly executed by the Parent, the Borrower and each of the Borrower’s Subsidiaries, together with (A) UCC financing statements and other applicable documents under the laws of all necessary or appropriate jurisdictions with respect to the perfection of the Liens granted under the Security Agreement, as requested by the Administrative Agent in order to perfect such Liens, duly authorized by the Loan Parties, (B) copies of favorable UCC, tax, judgment, fixture and real property lien search reports in all necessary or appropriate jurisdictions and under all legal and trade names of the Loan Parties, as reasonably requested by the Administrative Agent, indicating that there are no Liens on any of the Collateral other than Liens permitted by Section 7.2 and Liens to be released on the Closing Date, (C) original certificates evidencing all issued and outstanding shares of Capital Stock of the Borrower and all Subsidiaries owned directly by any Loan Party (in each case, to the extent certificated), together with stock or membership interest powers or other appropriate instruments of transfer executed in blank and (D) acknowledgements with respect to pledged equity interests other than stock of a corporation, duly executed by the issuer of such equity interests;

(xii) Mortgages duly executed by each applicable Loan Party and evidence satisfactory to the Administrative Agent that such Mortgages create a first-priority Lien (subject only to Liens permitted by Section 7.2), covering at least ninety-five percent (95%) of the present value of all PDP and PDNP Oil and Gas Properties and ninety-five percent (95%) of the present value of all PUD Oil and Gas Properties taken together, as evaluated in the Initial Reserve Report provided by the Borrower (based on the value given such proved reserves in the Initial Reserve Report), which have either been recorded of record in the appropriate jurisdictions or the Administrative Agent shall have approved the process for which such Mortgages will be recorded;

(xiii) Transfer Letters as may be required by the Administrative Agent, duly executed by each Loan Party that executes a Mortgage;

(xiv) Control Account Agreements (including, without limitation, the Reserve Account Control Agreement) covering all existing bank accounts, including the Lockbox Account, of the Loan Parties and their Subsidiaries, duly executed by each of the Collateral Agent, a depository bank acceptable to the Administrative Agent, and the applicable Loan Party;

(xv) title information setting forth evidence of satisfactory title on the proved Oil and Gas Properties of Loan Parties as requested by the Administrative Agent representing not less than eighty percent (80%) of the present value of all PDP and PDNP Oil and Gas Properties and eighty percent (80%) of the present value of all PUD Oil and Gas Properties taken together, as evaluated in the Initial Reserve Report provided by the Borrower (based on the value given such proved reserves in the Initial Reserve Report), which shall be in form and substance satisfactory to the Administrative Agent;

(xvi) true, accurate and complete copies of all Material Agreements certified by an officer of the Loan Parties;

(xvii) certificates of insurance, in form and detail acceptable to the Administrative Agent, describing in reasonable detail the types and amounts of insurance (property and liability) maintained by any of the Loan Parties, in each case naming the Collateral Agent as loss payee on property and casualty policies or additional insured on liability insurance policies, as the case may be, together with a lender’s loss payable endorsement on property and casualty policies in form and substance satisfactory to the Administrative Agent;

(xviii) to the extent reasonably requested by the Administrative Agent, due diligence information satisfactory to the Administrative Agent, in its sole discretion, regarding the Borrower and its Subsidiaries including information regarding legal matters, tax matters, accounting matters, business matters, financial matters, including prospects, insurance matters, labor matters, ERISA matters, pension liabilities (actual or contingent), material contracts, debt agreements, property ownership, contingent liabilities and other legal matters of the Borrower and its Subsidiaries;

(xix) at least five (5) Business Days prior to the Closing Date, to the extent requested by any Lender or the Administrative Agent at least ten (10) Business Days prior to the Closing Date, all documentation and other information required by regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including the USA Patriot Act;

(xx) the Initial Reserve Report accompanied by the certificate described in Section 5.13(c);

(xxi) a copy of an executed commodity hedging agreements with BP Energy Company which evidence meet the minimum thresholds requirements for hedging set forth in Section 7.10;

(xxii) the Hedge Intercreditor Agreement, in form and substance satisfactory to the Administrative Agent, and duly executed by the parties thereto, including the applicable Approved Counterparty;

(xxiii) evidence that Borrower has entered in to a crude oil purchase and sale agreement (“Offtake Agreement”), in form and substance and with an off-taker satisfactory to the Administrative Agent, which shall have at least the same tenor as the loan, including any extensions, and apply to all volumes of Hydrocarbons produced from the Oil and Gas Properties of the Borrower and its Subsidiaries;

(xxiv) a payoff letter with respect to the existing loan from Mutual of Omaha, in form and substance satisfactory to the Administrative Agent and including evidence of appropriate documentation relating to the release of all liens under such facility;

(xxv) evidence that all filings, notices, recordings and other actions deemed necessary by the Administrative Agent to perfect the liens in the Collateral shall have been made, given or accomplished or arrangements for the completion thereof satisfactory to the Administrative Agent shall have been made and all filing fees and other expenses related to such actions either have been paid in full or arrangements have been made for their payment in full which are satisfactory to the Administrative Agent;

(xxvi) all environmental due diligence and reports on the Oil and Gas Properties and be satisfied with the results, in its sole and absolute discretion;

(xxvii) evidence satisfactory to the Administrative Agent that the Borrower has a minimum of $1,000,000 of available cash at close for working capital; provided that monies funded into the Reserve Account for the Required Capital Reserve Amount and the Required Debt Service Reserve Amount on the Closing Date will not count towards this minimum working capital requirement;

(xxviii) an Approved Initial Acquisition and Development Plan and initial Approved Budget;

(xxix) evidence satisfactory to the Administrative Agent that the Borrower has established and funded Reserve Account with the Required Capital Reserve Amount and the Required Debt Service Reserve Amount on the Closing Date satisfactory to the Administrative Agent in its sole discretion;

(xxx) evidence that the Borrower has established and designated the Board Observer as required by Section 5.22;

(xxxi) evidence satisfactory to the Administrative Agent certain of those unpaid and owing royalty payments and payments owing to trade creditors set forth an officer’s certificate and denoted to be paid as of the Closing Date have been made in full in cash or arrangements have been made for their payment in full which are satisfactory to the Administrative Agent in its sole discretion; and

(xxxii) such other documents, certificates or information as the Administrative Agent or the Majority Lenders shall have reasonably requested.

Without limiting the generality of the provisions of this Section, for purposes of determining compliance with the conditions specified in this Section, each Lender that has signed this Credit Agreement shall be deemed to have consented to, approved of, accepted or been satisfied with each document or other matter required thereunder to be consented to, approved by or acceptable or satisfactory to a Lender unless the Administrative Agent shall have received notice from such Lender prior to the proposed Closing Date specifying its objection thereto.

Section 3.2. Conditions to Closing Date Borrowing. The obligation of each Lender to make a Loan on the Closing Date is subject to Section 2.24(b) and the satisfaction (or waiver) of the following conditions on Closing Date:

(a) at the time of and immediately after giving effect to such Borrowing, no Default or Event of Default shall exist and be continuing;

(b) at the time of and immediately after giving effect to such Borrowing, all representations and warranties of each Loan Party set forth in the Loan Documents shall be true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) on such date, except that any representation and warranty which by its terms is made as of a specified date shall be required to be true and correct in all material respects only as of such specified date;

(d) the Borrower shall have delivered the required Notice of Borrowing.

Each Borrowing shall be deemed to constitute a representation and warranty by the Borrower on the date thereof as to the matters specified in subsections (a), (b), (c) and (d) of this Section.

Section 3.3. Delivery of Documents. All of the Loan Documents, certificates, legal opinions and other documents and papers referred to in this Article, unless otherwise specified, shall be delivered to the Administrative Agent for the account of each of the Lenders and in sufficient counterparts or copies for each of the Lenders and shall be in form and substance satisfactory in all respects to the Administrative Agent.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

The Borrower represents and warrants to the Administrative Agent and each Lender as follows:

Section 4.1. Existence; Power. Each Loan Party (i) is duly organized, validly existing and in good standing as a corporation, partnership or limited liability company under the laws of the jurisdiction of its organization, (ii) has all requisite corporate, partnership or limited liability company power and authority to carry on its business as now conducted, and (iii) is duly qualified to do business, and is in good standing, in each jurisdiction where such qualification is required, except where a failure to be so qualified could not reasonably be expected to have a Material Adverse Effect.

Section 4.2. Organizational Power; Authorization. The execution, delivery and performance by each Loan Party of the Loan Documents to which it is a party are within such Loan Party’s organizational powers and have been duly authorized by all necessary organizational and, if required, shareholder, partner or member action. This Agreement has been duly executed and delivered by the Borrower and constitutes, and each other Loan Document to which any Loan Party is a party, when executed and delivered by such Loan Party, will constitute, valid and binding obligations of the Borrower or such Loan Party (as the case may be), enforceable against it in accordance with their respective terms, except as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally and by general principles of equity.

Section 4.3. Governmental Approvals; No Conflicts. The execution, delivery and performance by each Loan Party of the Loan Documents to which it is a party (a) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except those as have been obtained or made and are in full force and effect and except for filings necessary to perfect or maintain perfection of the Liens created under the Loan Documents, (b) will not violate any Requirement of Law applicable to such Loan Party or any of its Subsidiaries or any judgment, order or ruling of any Governmental Authority which could reasonably be expected to have a Material Adverse Effect, (c) will not violate or result in a default under (i) the Organizational Documents of such Loan Party or any of its Subsidiaries or (ii) any Contractual Obligation of such Loan Party or any of its Subsidiaries or any of its assets or give rise to a right thereunder to require any payment to be made by such Loan Party or any of its Subsidiaries which could reasonably be expected to have a Material Adverse Effect and (d) will not result in the creation or imposition of any Lien on any asset of such Loan Party or any of its Subsidiaries, except Liens (if any) created under the Loan Documents.

Section 4.4. Financial Statements.

(a) The Borrower has furnished to each Lender (i) the audited consolidated balance sheet of the Parent and its Subsidiaries as of June 30, 2018, and the related audited consolidated statements of income, shareholders’ equity and cash flows for the Fiscal Year then ended, prepared by an accounting firm approved by the Administrative Agent and (ii) the unaudited consolidated balance sheet of the Parent and its Subsidiaries as of December 31, 2018, and the related unaudited consolidated statements of income and cash flows for the Fiscal Quarter and year-to-date period then ended, certified by a Responsible Officer. Such financial statements fairly present, in all material respects, the consolidated financial position of the Parent and its Subsidiaries as of such dates and the consolidated results of operations for such periods, subject to year-end audit adjustments and the absence of footnotes in the case of the unaudited quarterly statements referred to in clause (ii). Since June 30, 2018, there have been no changes with respect to either the Parent and its Subsidiaries or the Borrower and its Subsidiaries, which have had or could reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect.

(b) Except for (i) the Obligations, (ii) the liabilities and obligations reflected in the financial statements previously delivered to the Administrative Agent or any Lender and (iii) other liabilities and obligations incurred after the date of such financial statements as permitted by this Agreement, no Loan Party has any liabilities or obligations, either accrued, contingent or otherwise, or any unusual long-term commitments or unrealized losses.

Section 4.5. Litigation and Environmental Matters.

(a) No litigation, investigation or proceeding of or before any arbitrators or Governmental Authorities is pending against or, to the knowledge of the Borrower, threatened in writing against or affecting a Loan Party or any of its Subsidiaries (i) as to which there is a reasonable possibility of an adverse determination that could reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect (after taking into account insurance proceeds or other recoveries from third parties actually recovered) or (ii) which in any manner draws into question the validity or enforceability of this Agreement or any other Loan Document.

(b) Except for the matters set forth on Schedule 4.5 or as could not reasonably be expected to have a Material Adverse Effect:

(i) neither the Loan Party, its Properties nor its operations conducted thereon violate any applicable Environmental Laws;

(ii) each Loan Party has obtained all Environmental Permits required for its operations and each of its Properties, with all such Environmental Permits being currently in full force and effect, and no Loan Party has received any written notice or otherwise has knowledge that any such existing Environmental Permit will be revoked or that any application for any new Environmental Permit or renewal of any existing Environmental Permit will be denied;

(iii) there are no claims, demands, suits, orders, investigations, or proceedings concerning any violation of, or any Environmental Liability (including as a potentially responsible party) under, any applicable Environmental Laws that is pending or, to any Loan Party’s knowledge, threatened against any Loan Party or any of its Properties or, to any Loan Party’s knowledge, as a result of any operations at such Properties;

(iv) to the knowledge of each Loan Party, all hazardous substances, solid waste and oil and gas waste, if any, generated at any and all Property of each Loan Party or any Subsidiary have in the past been transported, treated and disposed of in accordance with Environmental Laws and so as not to pose an imminent and substantial endangerment to public health or welfare or the environment, and in transporting, treating or disposing of the same all such transport carriers and treatment and disposal facilities have been and are operating in compliance with Environmental Laws so as not to pose an imminent and substantial endangerment to public health or welfare or the environment, and are not the subject of any existing, pending or, to the knowledge of any Loan Party, threatened action, investigation or inquiry by any Governmental Authority in connection with any Environmental Laws;

(v) there has been no Release or, to any Loan Party’s knowledge, threatened Release, of Hazardous Materials at, on, under or from any Loan Party’s Properties except in compliance with Environmental Laws and so as not to pose an imminent and substantial endangerment to public health or welfare or the environment, and to the knowledge of any Loan Party;

(vi) no Loan Party has received any written notice asserting an alleged Environmental Liability or obligation under any applicable Environmental Laws with respect to the investigation, remediation, abatement, removal, or monitoring of any Hazardous Materials at, under, or Released or threatened to be Released from any real properties offsite from any Loan Party’s Properties and there are no conditions or circumstances that could reasonably be expected to result in the receipt of such written notice; and

(vii) each Loan Party has provided to the Administrative Agent complete and correct copies of all material environmental site assessment reports, investigations, studies, analyses, and correspondence on environmental matters (including matters relating to any alleged non-compliance with or liability under Environmental Laws) that are in any Loan Party’s possession or control and relating to their respective Properties or operations thereon.

Section 4.6. Compliance with Laws and Agreements. Each Loan Party and each of its Subsidiaries is in compliance with (a) all Requirements of Law and all judgments, decrees and orders of any Governmental Authority applicable to it, and (b) all Material Agreements, in each case of (a) and (b), except where non-compliance, either individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.

Section 4.7. Investment Company Act. No Loan Party nor any its Subsidiaries is (a) an “investment company” or is “controlled” by an “investment company”, as such terms are defined in, or subject to regulation under, the Investment Company Act of 1940, as amended and in effect from time to time, or (b) otherwise subject to any other regulatory scheme limiting its ability to incur debt or requiring any approval or consent from, or registration or filing with, any Governmental Authority in connection therewith.

Section 4.8. Taxes. Each Loan Party and its Subsidiaries have timely filed or caused to be filed all Federal income tax returns and all other material tax returns that are required to be filed by them (after giving effect to any extension granted in the time for filing), and have paid all taxes shown to be due and payable on such returns or on any assessments made against it or its property and all other taxes, fees or other charges imposed on it or any of its property by any Governmental Authority, except where the same are currently being contested in good faith by appropriate proceedings and for which such Loan Party or such Subsidiary, as the case may be, has set aside on its books adequate reserves in accordance with GAAP. The charges, accruals and reserves on the books of each Loan Party and its Subsidiaries in respect of such taxes are adequate (in all material respects), and as of the date hereof no material tax liabilities in excess of the amount so provided are anticipated. No Loan Party nor any of its Subsidiaries has any obligation to pay or to its knowledge has any liability with respect to any of their Affiliates’ tax liability (other than such Loan Party or its Subsidiaries). No tax Lien has been filed and, to the knowledge of any Loan Party, no claim is being asserted with respect to any such tax or other such governmental charge.

Section 4.9. Margin Regulations. None of the proceeds of any of the Loans will be used, directly or indirectly, for “purchasing” or “carrying” any “margin stock” within the respective meanings of each of such terms under Regulation U or for any purpose that violates the provisions of Regulation T, Regulation U or Regulation X. No Loan Party nor any of its Subsidiaries is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying “margin stock”.

Section 4.10. ERISA. Except for matters that could not reasonably be expected to result in a Material Adverse Effect, each Plan is in substantial compliance in form and operation with its terms and with ERISA and the Code (including, without limitation, the Code provisions compliance with which is necessary for any intended favorable tax treatment) and all other applicable laws and regulations. Each Plan (and each related trust, if any) which is intended to be qualified under Section 401(a) of the Code has received a favorable determination letter from the Internal Revenue Service to the effect that it meets the requirements of Sections 401(a) and 501(a) of the Code covering all applicable tax law changes, or is comprised of a master or prototype plan that has received a favorable opinion letter from the Internal Revenue Service, and nothing has occurred since the date of such determination that would adversely affect such determination (or, in the case of a Plan with no determination, nothing has occurred that would adversely affect the issuance of a favorable determination letter or otherwise adversely affect such qualification), except as could not reasonably be expected to result in a Material Adverse Effect. No ERISA Event in respect to any Plan has occurred or is reasonably expected to occur. There exists no Unfunded Pension Liability with respect to any Plan. No Loan Party nor any of its Subsidiaries nor any ERISA Affiliate, in respect to any Plan of such Loan Party or any of its Subsidiaries, is making or accruing an obligation to make contributions, or has, within any of the five calendar years immediately preceding the date this assurance is given or deemed given, made or accrued an obligation to make, contributions to any Multiemployer Plan. There are no actions, suits or claims pending against or involving a Plan (other than routine claims for benefits) or, to the knowledge of the Borrower, any of its Subsidiaries or any ERISA Affiliate, threatened, which would reasonably be expected to be asserted successfully against any Plan and, if so asserted successfully, would reasonably be expected either singly or in the aggregate to result in a Material Adverse Effect. Each Loan Party and each of its Subsidiaries and each ERISA Affiliate have made all contributions to or under each Plan and Multiemployer Plan required by law within the applicable time limits prescribed thereby, by the terms of such Plan or Multiemployer Plan, respectively, or by any contract or agreement requiring contributions to a Plan or Multiemployer Plan, except as could not reasonably be expected to result in a Material Adverse Effect. No Plan which is subject to Section 412 of the Code or Section 302 of ERISA has applied for or received an extension of any amortization period within the meaning of Section 412 of the Code or Section 303 or 304 of ERISA, except as could not reasonably be expected to result in a Material Adverse Effect. No Loan Party nor any of its Subsidiaries nor any ERISA Affiliate have ceased operations at a facility so as to become subject to the provisions of Section 4068(a) of ERISA, withdrawn as a substantial employer so as to become subject to the provisions of Section 4063 of ERISA or ceased making contributions to any Plan subject to Section 4064(a) of ERISA to which it made contributions, except as could not reasonably be expected to result in a Material Adverse Effect.

Section 4.11. Ownership of Property; Insurance.

(a) Each Loan Party has good and Defensible Title to its respective Oil and Gas Properties and good title to, or valid leasehold interests in, all of its personal Properties in all material respects necessary or used in the ordinary course of its business, in each case free and clear of Liens prohibited by this Agreement under Section 7.2. After giving full effect to the Excepted Liens, each Loan Party specified as the owner owns the net interests in production attributable to the Hydrocarbon Interests as reflected in the most recently delivered Reserve Report as of the date of such Reserve Report (subject to any Asset Sales in compliance with Section 7.6 since delivery of such Reserve Report), and after giving full effect to Excepted Liens, the ownership of such Hydrocarbon Interests shall not in any material respect obligate such Loan Party to bear the costs and expenses relating to the maintenance, development and operations of each such Hydrocarbon Interest in an amount in excess of the working interest of such Hydrocarbon Interest set forth in the most recently delivered Reserve Report that is not offset by a corresponding proportionate increase in such Loan Party’s net revenue interest in such Hydrocarbon Interest.

(b) All material leases and agreements necessary for the conduct of the business of each Loan Party are valid and subsisting, in full force and effect, and there exists no default or event or circumstance which with the giving of notice or the passage of time or both would give rise to a material default under any such lease or agreement, except as would not reasonably be expected to result, individually or in the aggregate of all such leases and agreements, in a Material Adverse Effect.

(c) The rights and Properties presently owned, leased or licensed by each Loan Party including, without limitation, all easements and rights of way, include all rights and Properties reasonably necessary to permit each Loan Party to conduct its business in all material respects in the same manner as its business has been conducted prior to the date hereof.

(d) Except as could not reasonably be expected to have a Material Adverse Effect, the Oil and Gas Properties (and Properties unitized therewith) of each Loan Party have been maintained, operated and developed in a good and workmanlike manner and in conformity with all Requirements of Law and in conformity with the provisions of all leases, subleases or other contracts comprising a part of the Hydrocarbon Interests and other contracts and agreements forming a part of the Oil and Gas Properties of such Loan Party. Specifically in connection with the foregoing, except as could not reasonably be expected to have a Material Adverse Effect (i) no Oil and Gas Property of any Loan Party is subject to having allowable production 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) and (ii) the Xxxxx comprising a part of the Oil and Gas Properties (or Properties unitized therewith) of the Loan Parties are producing from or attributable to the Oil and Gas Properties (or in the case of Xxxxx located on Properties unitized therewith, such unitized Properties) of the Loan Parties. Except as could not reasonably be expected to have a Material Adverse Effect, all pipelines, xxxxx, gas processing plants, platforms and other material improvements, fixtures and equipment owned in whole or in part by each Loan Party that are necessary to conduct normal operations are being maintained in a state adequate to conduct normal operations, and with respect to such of the foregoing which are operated by such Loan Party, in a manner consistent with such Loan Party’s past practices.

(e) Each Loan Party owns, or is licensed or otherwise has the right to use, all patents, trademarks, service marks, trade names, copyrights and other intellectual property necessary to operate its business, and the use thereof by such Loan Party does not infringe on the rights of any other Person, except as could not reasonably be expected to have a Material Adverse Effect. Each Loan Party either owns or has valid licenses or other rights to use all databases, geological data, geophysical data, engineering data, seismic data, maps, interpretations and other technical information used in its business as presently conducted, subject to the limitations contained in the agreements governing the use of the same, which limitations are customary for companies engaged in the business of the exploration and production of Hydrocarbons except as could not reasonably be expected to have a Material Adverse Effect.

(f) Each Loan Party has (i) all insurance policies sufficient for the compliance by it with all Requirements of Law and all Material Agreements including, without limitation, Flood Insurance, if so required, and (ii) insurance coverage in at least amounts and against such risk (including, without limitation, public liability) that are usually insured against by companies similarly situated and engaged in the same or a similar business for the assets and operations of such Loan Party, which are set forth on Schedule 4.11. The Collateral Agent has been named as additional insured in respect of such liability insurance policies containing loss payable clauses and the Collateral Agent has been named as loss payee with respect to such Property loss insurance, in each case, in its capacity as Collateral Agent.

Section 4.12. Disclosure. The Borrower has disclosed or made available to Administrative Agent and the Lenders all Material Agreements, and all other instruments, and corporate or other restrictions to which a Loan Party or any of its Subsidiaries is subject, that have had or would reasonably be expected to have a Material Adverse Effect. None of the reports, financial statements, certificates or other information furnished by or on behalf of the Borrower or any Loan Party to the Administrative Agent or any Lender in connection with the negotiation or syndication of this Agreement or any other Loan Document or delivered hereunder or thereunder (as modified or supplemented by any other information so furnished) contains any untrue statement of a material fact or omits to state any material fact necessary to make the statements therein, taken as a whole in light of the circumstances under which they were made, not materially misleading as of the date made; provided that, with respect to projected financial information, the Borrower represents only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time furnished (it being understood that such projections are subject to significant uncertainties and contingencies and that no assurance can be given that any particular projection will be realized and that actual results may differ and such differences may be material).

Section 4.13. Labor Relations. There are no strikes, lockouts or other material labor disputes or grievances against any Loan Party or any of its Subsidiaries, or, to the Borrower’s knowledge, threatened against or affecting a Loan Party or any of its Subsidiaries, and no significant unfair labor practice charges or grievances are pending against the Borrower or any of its Subsidiaries, or, to the Borrower’s knowledge, threatened against any of them before any Governmental Authority. All payments due from a Loan Party or any of its Subsidiaries pursuant to the provisions of any collective bargaining agreement have been paid or accrued as a liability on the books of such Loan Party or any such Subsidiary.

Section 4.14. Subsidiaries. Schedule 4.14 sets forth the name of, the ownership interest of the applicable Loan Party in, the jurisdiction of incorporation or organization of, and the type of each Subsidiary of the Borrower and the other Loan Parties and identifies each Subsidiary that is a Subsidiary Loan Party, in each case as of the Closing Date. Each Subsidiary of a Loan Party is a wholly owned Subsidiary and is organized in a jurisdiction within the United States of America.

Section 4.15. Solvency. After giving effect to the execution and delivery of the Loan Documents and the making of the Loans under this Agreement, the Parent is Solvent, the Borrower is Solvent, and the Loan Parties, taken as a whole, are Solvent.

Section 4.16. Deposit and Disbursement Accounts. Schedule 4.16 lists all banks and other financial institutions at which any Loan Party maintains deposit accounts, lockbox accounts, disbursement accounts, investment accounts or other similar accounts as of the Closing Date, including, without limitation, the Lockbox Account and the Reserve Account, and such Schedule correctly identifies the name, address and telephone number of each financial institution, the name in which the account is held, the type of the account, and the complete account number therefor.

Section 4.17. Collateral Documents.

(a) Following the due execution and delivery of the Collateral Documents (other than the Mortgages) required to be executed and delivered by this Agreement, when UCC financing statements in appropriate form are filed in the appropriate governmental offices, the Collateral Agent shall have a valid and perfected first priority security interest in the Collateral (as defined therein) (to the extent that such security interest can be perfected by execution and delivery of the Collateral Documents and/or recording of the UCC financing statements), free and clear of all Liens other than Liens expressly permitted by Section 7.2. When the certificates evidencing all certificated Capital Stock of the Borrower and the Subsidiaries of the Borrower pledged pursuant to the Security Agreements are delivered to the Collateral Agent, together with appropriate stock powers or other similar instruments of transfer duly executed in blank, the Liens in such certificated Capital Stock shall be duly perfected first priority security interests, perfected by “control” as defined in the UCC to the extent capable of being perfected by delivery of such applicable certificates and instruments of transfer.

(b) Each Mortgage, when duly executed and delivered by the relevant Loan Party and properly filed in the real estate records where the Mortgaged Property covered thereby is located, shall constitute a valid and perfected first priority Lien on, and security interest in all of such Loan Party’s right, title and interest in and to the Mortgaged Property of such Loan Party covered thereby and the proceeds thereof (to the extent that such Mortgage can be perfected by execution, delivery and/or filing of such Mortgage), other than with respect to Liens expressly permitted by Section 7.2.

(c) No Loan Party owns any Building (as defined in the applicable Flood Insurance Law) or Manufactured (Mobile) Home (as defined in the applicable Flood Insurance Law) for which such Loan Party has not delivered to the Administrative Agent evidence reasonably satisfactory to the Administrative Agent that (a) such Loan Party maintains Flood Insurance for such Building or Manufactured (Mobile) Home or (b) such Building or Manufactured (Mobile) Home is not located in a Special Flood Hazard Area.

Section 4.18. Restriction on Liens. No Loan Party is a party to any agreement or arrangement, or subject to any order, judgment, writ or decree, which either restricts or purports to restrict its ability to grant Liens to the Collateral Agent for the benefit of the Secured Parties on or in respect of its Properties to secure the Obligations and the Loan Documents.

Section 4.19. Material Agreements. As of the Closing Date, all Material Agreements of a Loan Party and its Subsidiaries are listed on Schedule 4.19, and each such Material Agreement is in full force and effect. The Borrower does not have any knowledge of any pending amendments or threatened termination of any of the Material Agreements. As of the Closing Date, the Borrower has delivered to the Administrative Agent a true, complete and correct copy of each Material Agreement (including all schedules, exhibits, amendments, supplements, modifications, or assignments delivered pursuant thereto or in connection therewith).

Section 4.20. OFAC; Foreign Corrupt Practices Act.

(a) Neither any Loan Party nor any of its Subsidiaries or Affiliates (i) is a Sanctioned Person, (ii) has any of its assets in Sanctioned Countries, or (iii) derives any of its operating income from investments in, or transactions with, Sanctioned Persons or Sanctioned Countries. The Loan Parties and their respective directors, officers and employees and, to the knowledge of the Borrower, the agents of the Loan Parties, are in compliance with applicable Anti-Corruption Laws in all material respects and such Loan Party and its Subsidiaries have instituted and maintain policies and procedures designed to ensure continued compliance therewith.

(b) No part of the proceeds of any Loans hereunder will be used directly or indirectly to fund any operations in, finance any investments or activities in or make any payments to a Sanctioned Person or a Sanctioned Country or for any payments to any governmental official or employee, political party, official of a political party, candidate for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of applicable Anti-Corruption Laws.

Section 4.21. Patriot Act. Neither any Loan Party nor any of its Subsidiaries is an “enemy” or an “ally of the enemy” within the meaning of Section 2 of the Trading with the Enemy Act or any enabling legislation or executive order relating thereto. Neither any Loan Party nor any or its Subsidiaries is in violation of (a) the Trading with the Enemy Act, (b) any of the foreign assets control regulations of the United States Treasury Department (31 C.F.R., Subtitle B, Chapter V, as amended) or any enabling legislation or executive order relating thereto or (c) the Patriot Act. None of the Loan Parties (i) is a blocked person described in Section 1 of the Anti-Terrorism Order or (ii) to the best of its knowledge, engages in any dealings or transactions, or is otherwise associated, with any such blocked person.

Section 4.22. Gas Imbalances; Prepayments. Except as set forth on Schedule 4.22 or on the most recent certificate delivered pursuant to Section 5.13(c), to the Borrower’s knowledge, on a net basis there are no gas imbalances, take or pay or other prepayments with respect to the Loan Parties’ proved Oil and Gas Properties which would require the Loan Parties to deliver Hydrocarbons produced from their proved Oil and Gas Properties at some future time without then or thereafter receiving full payment therefor exceeding, in the aggregate, $300,000 in any calendar year.

Section 4.23. Marketing of Production. Except for contracts listed and in effect on the date hereof on Schedule 4.23, and thereafter either disclosed in writing to the Administrative Agent or included in the most recently delivered Reserve Report (with respect to all of which contracts each Loan Party represents it is receiving a price for all production sold thereunder which is computed substantially in accordance with the terms of the relevant contract and are not having deliveries curtailed substantially below the subject Property’s delivery capacity), no material agreements exist which are not cancelable on sixty (60) days’ notice or less without penalty or detriment for the sale of production from any Loan Party’s Hydrocarbons (including, without limitation, calls on or other rights to purchase, production, whether or not the same are currently being exercised) that (i) pertain to the sale of production at a fixed price or (ii) have a maturity or expiry date of longer than six (6) months from the date hereof, except, in each case, with the prior written consent of the Administrative Agent.

Section 4.24. Hedging Transactions and Qualified ECP Guarantor. Schedule 4.24, as of the date hereof, and after the date hereof, each report required to be delivered by the Borrower pursuant to Section 5.1(e), sets forth, a true and complete list of all Hedging Transactions of each Loan Party, the material terms thereof (including the type, term, effective date, termination date and notional amounts or volumes), the net xxxx to market value thereof, all credit support agreements relating thereto (including any margin required or supplied) and the counterparty to each such agreement. The Borrower and each Guarantor (other than Samson Montana) is a Qualified ECP Guarantor.

Section 4.25. EEA Financial Institutions. No Loan Party is an EEA Financial Institution.

Section 4.26. Delay Payments. The officer’s certificate sets forth a true, correct, and complete list of the names and amounts relating to all unpaid and owing royalty payments and unpaid trade creditors as of the Closing Date as well as the timing of when such payments shall be paid. None of the Hydrocarbon Interests of the Borrower, any other Loan Party or any of their respective Subsidiaries has been lost or forfeited or otherwise adversely impacted due to Borrower, such Loan Party’s or such Subsidiary’s failure to pay royalty payments or payments to trade creditors.

ARTICLE V

AFFIRMATIVE COVENANTS

The Borrower covenants and agrees that so long as any Obligation remains unpaid or outstanding:

Section 5.1. Financial Statements and Other Information. The Borrower will deliver to the Administrative Agent and each Lender:

(a) as soon as available and in any event within 90 days after the end of each Fiscal Year of Parent, a copy of the annual audited report for such Fiscal Year for the Parent and its Subsidiaries, containing a consolidated balance sheet of the Parent and its Subsidiaries as of the end of such Fiscal Year and the related consolidated statements of income, stockholders’ equity and cash flows (together with all footnotes thereto) of the Parent and its Subsidiaries for such Fiscal Year, setting forth in each case in comparative form the figures for the previous Fiscal Year, all in reasonable detail and reported on by an accounting firm approved by the Administrative Agent (without a “going concern” or like qualification, exception or explanation and without any qualification or exception as to the scope of such audit) to the effect that such financial statements present fairly in all material respects the financial position and the results of operations of the Parent and its Subsidiaries for such Fiscal Year on a consolidated basis in accordance with GAAP and that the examination by such accountants in connection with such consolidated financial statements has been made in accordance with generally accepted auditing standards;

(b) as soon as available and in any event within 45 days after the end of each Fiscal Quarter of the Parent, an unaudited consolidated balance sheets of the Parent and its Subsidiaries and as of the end of such Fiscal Quarter and the related unaudited consolidated statements of income and cash flows of the Parent and its Subsidiaries for such Fiscal Quarter and the then elapsed portion of such Fiscal Year and, commencing on April 1, 2019, together with comparative figures for the corresponding Fiscal Quarter and the corresponding portion of the Parent’s previous Fiscal Year;

(d) concurrently with the delivery of the financial statements referred to in subsections (a) and (b) of this Section (other than the financial statements for the fourth Fiscal Quarter of each Fiscal Year delivered pursuant to subsection (b) of this Section), a Compliance Certificate signed by the principal executive officer or the principal financial officer of the Borrower (i) certifying as to whether there exists and is continuing a Default or Event of Default on the date of such certificate and, if such a Default or an Event of Default then exists, specifying the details thereof and the action which the Borrower has taken or proposes to take with respect thereto, (ii) setting forth in reasonable detail calculations demonstrating compliance with the financial covenants set forth in Article VI, (iii) specifying any change in the identity of the Subsidiaries as of the end of such Fiscal Year or Fiscal Quarter from the Subsidiaries identified to the Administrative Agent and the Lenders on the Closing Date or as of the most recent Fiscal Year or Fiscal Quarter, as the case may be, and (iv) stating whether any change in GAAP or the application thereof has occurred since the date of the mostly recently delivered audited financial statements of the Parent and its Subsidiaries, and, if any change has occurred, specifying the effect of such change on the financial statements accompanying such Compliance Certificate;

(e) concurrently with the delivery of the financial statements referred to in subsection (b) of this Section, a certificate signed by the principal executive officer or the principal financial officer of the Borrower setting forth as of a recent date, a true and complete list of all Hedging Transactions of the Loan Parties, the material terms thereof (including the type, term, effective date, termination date and notional amounts or volumes), the net xxxx-to-market value therefor, any new credit support agreements relating thereto not listed on Schedule 4.24, any margin required or supplied under any credit support document, and the counterparty to each such agreement;

(f) concurrently with the delivery of the financial statements referred to in subsection (b) of this Section, a certificate signed by the principal executive officer or the principal financial officer of the Borrower setting forth information as to quantities or production from the Loan Parties’ proved Oil and Gas Properties, volumes of production sold, pricing, purchasers of production, gross revenues, lease operating expenses, and such other information as the Administrative Agent may reasonably request with respect to the relevant quarterly period;

(g) as soon as available and in any event within sixty (60) days after the end of each Fiscal Year of the Borrower, a 12-month development plan for the Borrower and its Subsidiaries for the current Fiscal Year prepared by the management of the Borrower and detailing the projected cash flows and Capital Expenditures of the Borrower and its Subsidiaries for such current Fiscal Year, including, without limitation, a 12-month budget for the Borrower and its Subsidiaries for such Fiscal Year detailing the monthly projected corporate general and administrative costs of the Borrower and its Subsidiaries (the “Approved Budget”);

(h) as soon as available and in any event within thirty (30) days after the end of each calendar month of the Parent, an unaudited consolidated balance sheet of the Parent and its Subsidiaries as of the end of such calendar month and the related unaudited consolidated statements of income and cash flows of the Parent and its Subsidiaries for such calendar month and the then elapsed portion of such Fiscal Year and, commencing on May 1, 2019, together with comparative figures for the corresponding calendar month and the corresponding portion of the Parent’s previous Fiscal Year;

(i) [reserved];

(j) promptly following the written request of the Administrative Agent, a list of all Persons purchasing Hydrocarbons from any Loan Party;

(k) on or before October 1^st of each Fiscal Year of the Borrower, an Updated Acquisition and Development Plan for the next fiscal year of the Borrower setting forth any modifications or updates to then-current Acquisition and Development Plan, subject at all times to Approval requirements set forth Section 2.3; and

(l) promptly following any request therefor, such other information regarding the results of operations, business affairs and financial position of the Parent, the Borrower or any of its Subsidiaries as the Administrative Agent or any Lender may reasonably request.

Section 5.2. Notices of Material Events.

(a) The Borrower will furnish to the Administrative Agent and each Lender prompt written notice of the following:

(i) the occurrence known to the Borrower of any Default or Event of Default which has occurred and is continuing (subject to any cure or notice periods set forth in Section 8.1 for any Event of Default);

(ii) the filing or commencement of, or any material development in, any action, suit or proceeding by or before any arbitrator or Governmental Authority against or, to the knowledge of the Borrower, affecting a Loan Party or any of its Subsidiaries which, if adversely determined, could reasonably be expected to result in a Material Adverse Effect;

(iii) the occurrence of any event or any other development by which a Loan Party or any of its Subsidiaries (i) receives notice or becomes aware that it fails to comply with any Environmental Law or to obtain, maintain or comply with any permit, license or other approval required under any Environmental Law, (ii) receives notice or becomes aware that it is subject to any Environmental Liability, (iii) receives notice of any claim with respect to any Environmental Liability, or (iv) becomes aware of any basis for any Environmental Liability, in each case which, either individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect;

(iv) promptly and in any event within 15 days after (i) the a Loan Party, any of its Subsidiaries or any ERISA Affiliate knows or has reason to know that any ERISA Event has occurred, a certificate of the chief financial officer of the Borrower describing such ERISA Event and the action, if any, proposed to be taken with respect to such ERISA Event and a copy of any notice filed with the PBGC or the IRS pertaining to such ERISA Event and any notices received by the Borrower, such Subsidiary or such ERISA Affiliate from the PBGC or any other governmental agency with respect thereto, and (ii) becoming aware (1) that there has been an increase in Unfunded Pension Liabilities (not taking into account Plans with negative Unfunded Pension Liabilities) since the date the representations hereunder are given or deemed given, or from any prior notice, as applicable, (2) of the existence of any Withdrawal Liability, (3) of the adoption of, or the commencement of contributions to, any Plan subject to Section 412 of the Code by the Borrower, any of its Subsidiaries or any ERISA Affiliate, or (4) of the adoption of any amendment to a Plan subject to Section 412 of the Code which results in a material increase in contribution obligations of a Loan Party, any of its Subsidiaries or any ERISA Affiliate, a detailed written description thereof from the chief financial officer of the Borrower or such Loan Party;

(v) the occurrence of any default or event of default known to the Borrower, or the receipt by a Loan Party or any of its Subsidiaries of any written notice of an alleged default or event of default, which has occurred and is continuing, with respect to any Material Indebtedness of a Loan Party or any of its Subsidiaries;

(vi) any material amendment or modification to any Material Agreement (together with a copy thereof), and prompt notice of any termination, expiration or loss of any Material Agreement;

(vii) notice of any change (A) in any Loan Party’s legal name, (B) in any Loan Party’s chief executive office, its principal place of business, any office in which it maintains books or records or any office or facility at which Collateral owned by it is located (including the establishment of any such new office or facility); provided that the foregoing notice obligation shall not apply to any change in the location of books or records resulting from Parent’s agreement with Xxxxxxx Corporate Pty Ltd for the provision of company secretarial, registered office and accounting services, (C) in any Loan Party’s identity or legal structure, (D) in any Loan Party’s federal taxpayer identification number or organizational number or (E) in any Loan Party’s jurisdiction of organization; and

(viii) any other development that results in, or could reasonably be expected to result in, a Material Adverse Effect.

(b) The Borrower will furnish to the Administrative Agent and each Lender as soon as available and in any event within 30 days after receipt thereof, a copy of any environmental report or site assessment obtained by or for a Loan Party or any of its Subsidiaries after the Closing Date on any Oil and Gas Property, which would reasonably be expected to result in a Material Adverse Effect.

(c) Each notice or other document delivered under this Section shall be accompanied by a written statement of a Responsible Officer setting forth the details of the event or development requiring such notice or other document and any action taken or proposed to be taken with respect thereto.

Section 5.3. Existence; Conduct of Business. The Borrower will, and will cause each Loan Party and each of their respective Subsidiaries to do or cause to be done all things necessary to (a) preserve, renew and maintain in full force and effect (i) its legal existence and (ii) except where the failure to do so would not reasonably be expected to result in a Material Adverse Effect, its respective rights, licenses, permits (including Environmental Permits), privileges, franchises, patents, copyrights, trademarks and trade names material to the conduct of its business and (b) maintain, if necessary, its qualification to do business in each other jurisdiction in which its Oil and Gas Properties are located or the ownership of its Properties requires such qualification; provided that nothing in this Section shall prohibit any merger, consolidation, liquidation or dissolution permitted under Section 7.3.

Section 5.4. Compliance with Laws. The Borrower will, and will cause each Loan Party and each of their respective Subsidiaries to, (a) comply with all laws, rules, regulations and requirements of any Governmental Authority applicable to its business and properties, including, without limitation, all Environmental Laws, ERISA and OSHA, except where the failure to do so, either individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect and (b) maintain in effect and enforce policies and procedures designed to promote and achieve compliance by the Borrower, a Loan Party and their respective Subsidiaries and their respective directors, officers, employees and agents with applicable Anti-Corruption Laws.

Section 5.5. Payment of Obligations. The Borrower will, and will cause each Loan Party and each of their respective Subsidiaries to, pay and discharge at or before maturity all of its obligations and liabilities (including, without limitation, all taxes, assessments and other governmental charges, levies and all other claims that could result in a statutory Lien) before the same shall become delinquent or in default, except where (a) (i) the validity or amount thereof is being contested in good faith by appropriate proceedings and (ii) the Borrower, any Loan Party or such Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP or (b) the failure to make payment pending such contest could not reasonably be expected to result in a Material Adverse Effect.

Section 5.6. Books and Records. The Borrower will, and will cause each Loan Party and each of their respective Subsidiaries to, keep proper books of record and account in which full, true and correct entries shall be made of all dealings and transactions in relation to its business and activities to the extent necessary to prepare the consolidated financial statements of the Borrower in conformity with GAAP.

Section 5.7. Visitation and Inspection. The Borrower will, and will cause each Loan Party, and each of their respective Subsidiaries to, permit any representative of the Administrative Agent or any Lender, under the reasonable guidance of officers of or employees delegated by officers of such Loan Party or such Subsidiary, and subject to any applicable confidentiality considerations, visit and inspect its Properties (including its Oil and Gas Properties), to examine its books and records and to make copies and take extracts therefrom, and to discuss its affairs, finances and accounts with any of its officers and with its independent certified public accountants, all at such reasonable times and as often as the Administrative Agent or any Lender may reasonably request after reasonable prior notice to the Borrower; provided that if an Event of Default has occurred and is continuing, no prior notice shall be required; provided, further, that so long as no Event of Default has occurred and is continuing, the Loan Parties shall not be required to reimburse the Administrative Agent or the Lenders for more than one such inspection during any fiscal year.

Section 5.8. Maintenance of Properties; Insurance. The Borrower will, and will cause each Loan Party and each of their respective Subsidiaries to:

(a) operate its proved Oil and Gas Properties and other material Properties or, to the extent the Borrower is not the operator of any Property, use commercially reasonable efforts to cause such Oil and Gas Properties and other Properties to be operated (it being understood that this shall not be construed to require any Loan Party to include this Section 5.8 in any contractual arrangements with such operators), as a Prudent Operator would in accordance with the practices of the industry and in compliance with all applicable contracts and agreements binding on it (except as contested in good faith with appropriate proceedings) and in compliance with all Requirements of Law, including, without limitation, applicable proration requirements and Environmental Laws, and all applicable laws, rules and regulations of every other Governmental Authority from time to time constituted to regulate the development and operation of its proved Oil and Gas Properties and the production and sale of Hydrocarbons and other minerals therefrom;

(b) maintain and keep in good condition and repair (normal wear and tear excepted) all of its material proved Oil and Gas Properties and other material Properties, including, without limitation, all such equipment, machinery and facilities;

(c) promptly pay and discharge, or make reasonable and customary efforts to cause to be paid and discharged, all delay rentals, royalties, expenses and indebtedness accruing under the leases or other agreements affecting or pertaining to its proved Oil and Gas Properties (except where the amount thereof is being contested in good faith by appropriate proceedings and for which adequate reserves have been maintained in accordance with GAAP) and will do all other things reasonably necessary to keep unimpaired their rights with respect thereto and prevent any forfeiture thereof or default thereunder (other than those expiring according to their terms);

(d) promptly perform or cause to be performed, in accordance with industry standards, the obligations required by each and all of the assignments, deeds, leases, sub-leases, contracts and agreements affecting its interests in its proved Oil and Gas Properties and other material Properties;

(e) maintain with financially sound and reputable insurance companies which are not Affiliates of the Borrower (i) insurance with respect to its properties and business, and the properties and business of its Subsidiaries, against loss or damage of the kinds customarily insured against by companies in the same or similar businesses operating in the same or similar locations (including, to the extent applicable, flood insurance for Collateral located in a designated “flood hazard area” in any Flood Insurance Rate Map published by the Federal Emergency Management Agency (or any successor agency), and as required by Regulation H of the Federal Reserve Board, as from time to time in effect and all official rulings and interpretations thereunder or thereof) and (ii) all insurance required to be maintained pursuant to the Collateral Documents or any applicable Requirement of Law, and will, upon request of the Administrative Agent, furnish to each Lender at reasonable intervals a certificate of a Responsible Officer setting forth the nature and extent of all insurance maintained by the Borrower and its Subsidiaries in accordance with this Section;

(f) without limiting the generality of the preceding clause, the Borrower will maintain and cause its Subsidiaries to maintain, casualty insurance and liability insurance with respect to liabilities, losses or damage in respect of the Properties and businesses of the Loan Parties, in each case, in such amounts, with such deductibles, covering such risks and otherwise on such terms and conditions as shall be customary for companies in the same or similar businesses operating in the same or similar locations and as reasonably satisfactory to the Administrative Agent; and

(g) at all times shall name the Collateral Agent as additional insured on all liability insurance policies of the Borrower, a Loan Party and their respective Subsidiaries and as loss payee (pursuant to a loss payee endorsement approved by the Administrative Agent) on all casualty insurance policies of the Borrower, such Loan Party and its respective Subsidiaries and use commercially reasonable efforts to cause such policies to provide that the insurer will give at least thirty (30) days prior notice of any cancellation to the Collateral Agent.

Section 5.9. Use of Proceeds; Margin Regulations. The Borrower will use the proceeds of all Loans to refinance the Existing Facility, fund the acquisition, exploration and development of Oil and Gas Properties, finance working capital needs, capital and operating expenditures and for other general corporate purposes of the Borrower and its Subsidiaries. No part of the proceeds of any Loan will be used, whether directly or indirectly, for any purpose in contravention of Section 4.9 or for any purpose that would violate any rule or regulation of the Board of Governors of the Federal Reserve System, including Regulation T, Regulation U or Regulation X.

Section 5.10. Events of Loss. The Borrower (a) will furnish to the Administrative Agent and the Lenders prompt written notice of any Event of Loss to any material portion of any Collateral (including any Event of Loss that constitutes a Triggering Event) and (b) will cause the Net Proceeds of any such event (whether in the form of insurance proceeds, condemnation awards or otherwise) to be collected and applied in accordance with the applicable provisions of this Agreement and the Collateral Documents.

Section 5.11. Cash Management. The Borrower will, and will cause each Loan Party, and each of their respective Subsidiaries:

(a) maintain all cash management and treasury business with Mutual of Omaha Bank or another bank approved by the Administrative Agent, including, without limitation, all deposit accounts, disbursement accounts, securities accounts, investment accounts and lockbox accounts (other than (x) zero-balance accounts for the purpose of managing local disbursements, payroll, withholding and other fiduciary accounts, all of which the Loan Parties may maintain without restriction (collectively, such accounts being “Zero-Balance Accounts”) and (y) accounts in existence on the Closing Date that have on deposit amounts for checks issued prior to or on the Closing Date that have not yet been deposited by the payee thereof, but only to the extent of such amounts) (each such deposit account, disbursement account, investment account and lockbox account, a “Controlled Account”); each Controlled Account, including, without limitation, the Lockbox Account and the Reserve Account, shall be a cash collateral account, with all cash, checks and other similar items of payment in such account securing payment of the Obligations, and in which the Borrower, a Loan Party and each of their respective Subsidiaries shall have granted a first priority Lien to the Collateral Agent, on behalf of the Secured Parties, perfected pursuant to Control Account Agreements; and

(b) deposit promptly, and in any event no later than two (2) Business Days after the date of receipt thereof, all cash, checks, drafts or other similar items of payment relating to or constituting payments made in respect of any and all accounts and other Collateral into the Controlled Accounts.

Section 5.12. Additional Subsidiaries and Collateral.

(a) In the event that, subsequent to the Closing Date, any Person becomes a Subsidiary of a Loan Party, whether pursuant to formation, acquisition or otherwise, (x) the Borrower shall notify the Administrative Agent and the Lenders not less than ten (10) Business Days prior to the formation or acquisition of such Subsidiary and (y) on the date that such Person becomes a Subsidiary of a Loan Party, the Borrower shall cause such Subsidiary (i) to become a new Guarantor and to grant Liens in favor of the Collateral Agent in all of its personal property by executing and delivering to the Collateral Agent a supplement to the Guaranty Agreement in form and substance reasonably satisfactory to the Administrative Agent, and authorizing and delivering, at the request of the Administrative Agent, such UCC financing statements or similar instruments required by the Administrative Agent to perfect the Liens in favor of the Collateral Agent and granted under any of the Loan Documents, (ii) to grant Liens in favor of the Collateral Agent in the Oil and Gas Properties of such Subsidiary by executing and delivering to the Collateral Agent such Mortgages, to the extent necessary to maintain compliance with Section 5.15, and (iii) to deliver all such other documentation (including, without limitation, certified organizational documents, resolutions, lien searches, environmental reports and, if requested by the Administrative Agent, legal opinions) and to take all such other actions as such Subsidiary would have been required to deliver and take pursuant to Section 3.1 if such Subsidiary had been a Loan Party on the Closing Date or that such Subsidiary would be required to deliver pursuant to Section 5.13 with respect to any Oil and Gas Properties. In addition, within five (5) Business Days after the date any Person becomes a Subsidiary of a Loan Party, the Borrower shall, or shall cause the applicable Loan Party to (i) pledge all of the Capital Stock of such Subsidiary to the Collateral Agent as security for the Obligations by executing and delivering a supplement to the Security Agreement in form and substance satisfactory to the Administrative Agent, and (ii) if the Capital Stock of such Subsidiary is certificated, deliver the original certificates evidencing such pledged Capital Stock to the Collateral Agent, together with appropriate powers executed in blank.

(b) The Borrower agrees that, following the due execution and delivery of the Collateral Documents required to be executed and delivered by this Section, when UCC financing statements in appropriate form are filed in the appropriate governmental offices, the Collateral Agent shall have a valid, first priority perfected Lien on the property required to be pledged pursuant to subsection (a) (to the extent that such Lien can be perfected by execution, delivery of the Collateral Documents and/or recording of the UCC financing statements), free and clear of all Liens other than Liens expressly permitted by Section 7.2. All actions to be taken pursuant to this Section shall be at the expense of the Borrower or the applicable Loan Party, and shall be taken to the reasonable satisfaction of the Administrative Agent.

Section 5.13. Reserve Reports.

(a) On or before March 1, June 1, September 1 and December 1 of each year, commencing June 1, 2019, the Borrower shall furnish to the Administrative Agent and the Lenders a Reserve Report evaluating the Oil and Gas Properties evaluated by such Reserve Report of the Borrower and its Subsidiaries as of January 1^st, April 1^st, July 1^st and October 1^st, respectively, of such year. The Reserve Reports due June 1 and December 1 of each year shall be prepared by one or more Approved Petroleum Engineers, and the Reserve Report due March 1 and September 1 of each year shall be prepared by or under the supervision of the chief engineer of the Borrower who shall certify such Reserve Report to be true and accurate and to have been prepared in accordance with the procedures used in the Reserve Report most recently prepared by the Approved Petroleum Engineers; provided that, during the continuance of a Default or an Event of Default, upon request by the Administrative Agent delivered not less than forty-five (45) days prior to the due date thereof, all Reserve Reports required to be delivered under this Agreement during the pendency of one or more Defaults or Events of Default shall be prepared by one or more Approved Petroleum Engineers.

(b) (1) Administrative Agent (at the direction of the Majority Lenders) shall have the right to request two interim Reserve Reports per fiscal year and (2) Borrower shall have the right to request one interim Reserve Report per fiscal year, to determine the Asset Coverage Ratio as of such date of determination (an “Interim Request”). In the event of an Interim Asset Coverage Ratio Test Date, on or prior to fifteen (15) days following the Borrower’s receipt of such Interim Request by the Administrative Agent, the Borrower shall furnish to the Administrative Agent and the Lenders a Reserve Report, subject to the proviso in Section 5.13(a), prepared by or under the supervision of the chief engineer of the Borrower who shall certify such Reserve Report to be true and accurate and to have been prepared in accordance with the procedures used in the Reserve Report most recently prepared by the Approved Petroleum Engineers. For any Interim Request by the Administrative Agent, the Borrower shall provide such Reserve Report with an “as of” date no later than thirty (30) days following the receipt of such request.

(c) With the delivery of each Reserve Report, the Borrower shall provide to the Administrative Agent and the Lenders a certificate from its principal executive officer or the principal financial officer certifying that to the best of his or her knowledge and in all material respects: (i) the information contained in the Reserve Report and any other information delivered in connection therewith is true and correct, (ii) based on information presented in such Reserve Report, the Borrower and its Subsidiaries own good and Defensible Title to the proved Oil and Gas Properties evaluated in such Reserve Report (other than those disposed of since the date of the Reserve Report as permitted by this Agreement and other than leases that have expired in accordance with their terms) and such Properties are free of all Liens except for Liens permitted under Section 7.2, (iii) except as set forth on an exhibit to the certificate, on a net basis there are no gas imbalances, take or pay or other prepayments in excess of the volume specified in Section 4.22 with respect to its proved Oil and Gas Properties evaluated in such Reserve Report which would require the Borrower and its Subsidiaries to deliver Hydrocarbons either generally or produced from such proved Oil and Gas Properties at some future time without then or thereafter receiving full payment therefor, (iv) none of their proved Oil and Gas Properties have been sold since the date of the last Asset Coverage Ratio Test Date except as set forth on an exhibit to the certificate, which certificate shall list all of its proved Oil and Gas Properties sold and in such detail as reasonably required by the Administrative Agent, (v) attached to the certificate is a list of all marketing agreements entered into subsequent to the later of the date hereof or the most recently delivered Reserve Report which the Borrower and its Subsidiaries could reasonably be expected to have been obligated to list on Schedule 4.23 had such agreement been in effect on the date hereof, (vi) attached thereto is a description of any minimum volume commitments or deficiency payment obligations estimated (calculated at the time of delivery of such Reserve Report and based upon the production forecasts therein) to be payable by any Loan Party pursuant to any gathering, processing or transportation agreement, (vii) attached thereto is a schedule of the Oil and Gas Properties evaluated by such Reserve Report that are Mortgaged Property and demonstrating the percentage of the present value of the proved Oil and Gas Properties evaluated in such Reserve Report that the value of such Mortgaged Property represent in compliance with Section 5.15, and (viii) a calculation of the Asset Coverage Ratio and Asset Coverage Ratio (PDP), together with such supporting information as the Administrative Agent may reasonably request.

Section 5.14. Title Information.

(a) On or before the delivery to the Administrative Agent and the Lenders of each Reserve Report required by Section 5.13, the Borrower will deliver title information in form and substance reasonably acceptable to the Administrative Agent covering the proved Oil and Gas Properties evaluated by such Reserve Report as requested by the Administrative Agent covering, together with title information previously delivered to the Administrative Agent, at least eighty percent (80%) of the present value of all PDP and PDNP Oil and Gas Properties and eighty percent (80%) of the present value of all PUD Oil and Gas Properties taken together, evaluated by such Reserve Report.

(b) If the Borrower has provided title information under Section 5.14(a), the Borrower shall, or shall cause the applicable Loan Party to, within sixty (60) days after notice from the Administrative Agent that title defects or exceptions exist with respect to such additional Properties which are not Excepted Liens and that result in the applicable Loan Party owning less than Defensible Title to such additional Properties, either (i) cure any such title defects or exceptions (including defects or exceptions as to priority) which are not permitted by Section 7.2 raised by such information, (ii) substitute acceptable Oil and Gas Properties with no title defects or exceptions except for Excepted Liens having an equivalent value or (iii) deliver title information in form and substance acceptable to the Administrative Agent so that the Administrative Agent shall have received, together with title information previously delivered to the Administrative Agent, satisfactory title information on at least eighty percent (80%) of the present value of all PDP and PDNP Oil and Gas Properties and eighty percent (80%) of the present value of all PUD Oil and Gas Properties taken together, evaluated by such Reserve Report.

Section 5.15. Mortgaged Property. In connection with each Asset Coverage Ratio Test Date, the Borrower shall, and shall cause its Subsidiaries to, within thirty (30) days following the due date of each Reserve Report from the Borrower required by Section 5.13 or (fifteen (15) days, in the case of a Reserve Report delivered in connection with an Interim Asset Coverage Ratio Test Date), grant to the Collateral Agent as security for the Obligations, a first-priority Lien (other than Liens permitted by Section 7.2) on additional proved Oil and Gas Properties of the Borrower and its Subsidiaries not already subject to a Lien of the Collateral Documents which will represent in any event, when combined with all other Mortgaged Property, at least ninety-five percent (95%) of the present value of all PDP and PDNP Oil and Gas Properties and ninety-five percent (95%) of the present value of all PUD Oil and Gas Properties taken together of the Loan Parties evaluated by such Reserve Report. All such Liens will be created and perfected by and in accordance with the provisions of mortgages, deeds of trust, security agreements and financing statements or other Collateral Documents, all in form and substance reasonably satisfactory to the Administrative Agent and in sufficient executed (and acknowledged where necessary or appropriate) counterparts for recording purposes. In order to comply with the foregoing, if any Subsidiary places a Lien on its proved Oil and Gas Properties and such Subsidiary is not a Guarantor, then it shall become a Guarantor and comply with Section 5.12(a).

Section 5.16. Further Assurances. The Borrower will, and will cause each other Loan Party to, execute any and all further documents, financing statements, agreements and instruments, and take all such further actions (including the filing and recording of financing statements, fixture filings, Mortgages and other documents), which may be required under any applicable law, or which the Administrative Agent or the Majority Lenders may reasonably request, to effectuate the transactions contemplated by the Loan Documents pursuant to such Loan Documents or to grant, preserve, protect or perfect the Liens created by the Collateral Documents or the validity or priority of any such Lien pursuant to such Loan Documents, all at the expense of the Loan Parties. The Borrower also agrees to provide to the Administrative Agent, from time to time upon request, evidence reasonably satisfactory to the Administrative Agent as to the perfection and priority of the Liens created or intended to be created by the Collateral Documents. The Borrower hereby authorizes the Collateral Agent to file one or more financing or continuation statements, and amendments thereto, relative to all or any part of the Mortgaged Property without the signature of the Borrower or any other Loan Party where permitted by law. A carbon, photographic or other reproduction of the Collateral Documents or any financing statement covering the Mortgaged Property or any part thereof shall be sufficient as a financing statement where permitted by law.

Section 5.17. Environmental Matters.

(a) The Borrower will, and will cause each other Loan Party to (i) create, handle, transport, use, or dispose of any Hazardous Material solely in compliance with Environmental Laws except if such non-compliance could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect, (ii) release, any Hazardous Material on, under, about or from any of Loan Party’s Properties or any other property offsite the Property to the extent caused by such Loan Party’s operations in compliance with applicable Environmental Laws, except if non-compliance therewith could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect; (iii) promptly commence and diligently prosecute to completion, and shall cause each Subsidiary to promptly commence and diligently prosecute to completion, any assessment, evaluation, investigation, monitoring, containment, cleanup, removal, repair, restoration, remediation or other remedial obligations (collectively, the “Remedial Work”) in the event any Remedial Work is required or reasonably necessary under applicable Environmental Laws because of or in connection with the actual or suspected past, present or future Release or threatened Release of any Hazardous Material on, under, about or from any of any Loan Party’s Properties by such Loan Party, if the failure to do so, could, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect and (iv) establish and implement, and shall cause each Subsidiary to establish and implement, such procedures as may be necessary to comply with this Section 5.17(a).

(b) The Borrower will promptly, but in no event later than five (5) Business Days after any Loan Party obtains knowledge thereof, notify the Administrative Agent and the Lenders in writing of any threatened action, investigation or inquiry by any Governmental Authority or any threatened demand or lawsuit by any Person against any Loan Party or their Properties of which the Borrower has knowledge in connection with any Environmental Laws if such Loan Party could reasonably anticipate that such action will result in liability (whether individually or in the aggregate) in excess of $500,000, not fully covered by insurance, subject to normal deductibles.

Section 5.18. Offtake Agreement. The Borrower shall or shall cause any applicable Subsidiary to maintain the Offtake Agreement at all times during the term of this Agreement.

Section 5.19. Hedging Transactions. The Borrower shall enter into and maintain Hedging Transactions relating Hydrocarbon Interests expected to be produced by the Borrower and its Subsidiaries from the Mortgaged Properties in an amount equal to at least the minimum thresholds set forth in Section 7.10, as such production is projected in the Reserve Report most recently delivered, after deducting projected production from any properties or interests sold or under contract for sale that have been included in such report and after adding projected production from any properties or interests that had not been reflected in such report but that are reflected in a separate or supplemental Reserve Report meeting the requirements of this Agreement and otherwise are satisfactory to Administrative Agent.

Section 5.20. Lockbox Account. The Borrower shall and shall cause each Loan Party and applicable Subsidiary to maintain a Lockbox Account (subject to a blocked Control Account Agreement) with a financial institution acceptable to the Administrative Agent, in its sole and reasonable discretion.

Section 5.21. Commodity Exchange Act Keepwell Provisions. The Borrower hereby guarantees the payment and performance of all Obligations of each Loan Party (other than the Borrower) and absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to time to each Loan Party (other than the Borrower) in order for such Loan Party to honor its obligations under the Guarantee and Security Agreement including obligations with respect to Hedging Obligations secured by the Collateral Documents (provided, however, that the Borrower shall only be liable under this Section 5.21 for the amount of such liability that can be hereby incurred without rendering its obligations under this Section 5.21, or otherwise under this Agreement, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount). The obligations of the Borrower under this Section 5.21 shall remain in full force and effect until all Obligations (other than contingent indemnification obligations) are paid in full to the Lenders, the Administrative Agent and all other Secured Parties, and all of the Lenders’ Commitments are terminated. The Borrower intends that this Section 5.21 constitute, and this Section 5.21 shall be deemed to constitute, a “keepwell, support, or other agreement” for the benefit of each other Loan Party for all purposes of Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

Section 5.22. Board Observer. For so long as the outstanding Term Loan exceeds $100,000, the Administrative Agent shall be entitled to designate one (1) non-voting representative (the “Board Observer”) to attend any meetings of the board of directors (or other applicable governing body) of the Borrower, except that the Board Observer shall temporarily leave any portion of such meetings directly related to this Agreement or the other Loan Documents or any refinancing thereof or relate to any legally privileged material or discussions (“Excluded Meeting Portions”). The Borrower shall give notice of (in the same manner that notice is given to the board of directors or other members thereof) all meetings (whether in person, telephonic or otherwise) of the board of directors and allow the Board Observer to attend all meetings, other than Excluded Meeting Portions. The Borrower shall also provide to the Board Observer a copy of all notices, agendas and other materials or information distributed to the board of directors and any committees thereof, whether provided to the board of directors or other members thereof in advance or, during or after any meeting, except to the extent relating to Excluded Meeting Portions. The Borrower shall reimburse the Board Observer upon demand for any and all reasonable out-of-pocket expenses incurred by the Board Observer in connection with the foregoing board visitation rights.

Section 5.23. Required Capital Reserve Amount. As of the Closing Date and throughout the term of this Agreement, the Borrower shall maintain not less than the Required Capital Reserve Amount in the Reserve Account, which Required Capital Reserve Amount shall be calculated without consideration to the Required Debt Service Reserve Amount.

Section 5.24. Required Debt Service Reserve Amount. As of the Closing Date and as of the last day of each Fiscal Quarter, the Borrower shall maintain not less than the Required Debt Service Reserve Amount in the Reserve Account, which Required Debt Service Reserve Amount shall be calculated without consideration to the Required Capital Reserve Amount. At any time that an Event of Default has occurred and is continuing pursuant to Section 8.1(a) or Section 8.1(b), without limitation to the Administrative Agent’s other rights and remedies under this Agreement and each other Loan Document, the Borrower irrevocably authorizes the Collateral Agent, at the direction of the Majority Lenders, to withdraw funds from the Reserve Account and apply such funds against any amounts past due under this Agreement or any other Loan Document.

Section 5.25. Post-Closing Covenants.

(a) Trade Payables. Within ninety (90) days after the Closing Date, the Borrower shall deliver to the Administrative Agent evidence satisfactory to the Administrative Agent, in its reasonable discretion, that one hundred percent (100%) of all delay payments relating to the Mortgaged Properties (including, without limitation, all amounts owed to royalty-owners and trade creditors listed in an officer’s certificate delivered to the Administrative Agent on the date hereof or as thereafter updated) have been paid in full.

(b) [Reserved].

(i) Within ten (10) days after the Closing Date, the Borrower shall have hired the Third-Party Monitor to assist the Borrower in the preparation, submission, monitoring and advancement of the required administrative filings (“Required Administrative Filings”) pertaining to those oil and gas/mineral leases set forth in Schedule III attached hereto (the “Federal and State Leases”) with the applicable Governmental Authority (including, without limitation, the Bureau of Land Management, the Wyoming Office of State Lands and Investments, and the North Dakota Department of Trust Lands) evidencing the transfer of rights to the Borrower in such Federal and State Leases.

(ii) The Borrower shall (A) file, or cause the Third-Party Monitor to file on behalf of the Borrower, within thirty (30) days after the Closing Date, the Required Administrative Filings, (B) provide, or cause the Third-Party Monitor to provide, to the Administrative Agent evidence, in form and substance acceptable to the Administrative Agent, in its reasonable discretion, of the submission of such Required Administrative Filing, including, without limitation, a copy of any applicable evidence of filing provided by the applicable Governmental Authority, and (C) cooperate fully with the Third-Party Monitor to accomplish the Required Administrative Filings within the time period required by Section 5.25(c)(ii)(A) and in using commercially reasonable efforts to successfully update the records of the applicable Governmental Authorities to evidence the rights of the Borrower in the Federal and State Leases within the time period required by the last sentence of Section 5.25(c)(iv).

(iii) Borrower shall provide, or cause the Third-Party Monitor to provide, Administrative Agent with monthly updates delivered within three (3) Business Days of the end of each calendar month, and additional updates, as reasonably requested by the Administrative Agent, as to the status of each Required Administrative Filing and the process of updating the records of the applicable Governmental Authorities to evidence the rights of the Borrower in the Federal and State Leases.

(iv) Within one hundred eighty (180) days after the Closing Date, the Borrower shall provide, or shall cause the Third-Party Monitor to provide, to the Administrative Agent a report as to the status of the Required Administrative Filings pertaining to each Federal and State Lease. The Administrative Agent shall review such report and provide instruction as to additional actions required by Administrative Agent to successfully update the records of the applicable Governmental Authorities to evidence the rights of the Borrower in the Federal and State Leases. The Borrower shall use its commercially reasonable efforts to undertake, or cause the Third-Party Monitor to undertake, such additional steps specified by the Administrative Agent within three hundred sixty (360) days of the Closing Date.

ARTICLE VI

FINANCIAL COVENANTS

The Borrower covenants and agrees that so long as any Obligation remains unpaid or outstanding:

Section 6.1. Leverage Ratio. Beginning with the Fiscal Quarter ending June 30, 2019, the Borrower will not permit the Leverage Ratio, as of the last day of any Fiscal Quarter, (i) for the Fiscal Quarter ending on June 30, 2019, to exceed 4.75:1.00, (ii) for any Fiscal Quarter after June 30, 2019 but ending on or before March 31, 2020, to exceed 4.00 to 1.00, (iii) for the fiscal quarters ending on June 30, 2020 and September 30, 2020, to exceed 3.50 to 1.00, and (iv) for all Fiscal Quarters thereafter, to exceed 3.00 to 1.00.

Section 6.2. Current Ratio. Beginning with the Fiscal Quarter ending June 30, 2019, the Borrower will not permit the ratio of Current Assets to Current Liabilities as of the last day of any Fiscal Quarter to be less than 1.00 to 1.00.

Section 6.3. Asset Coverage Ratio. Beginning with the Fiscal Quarter ending June 30, 2019, the Borrower will not, as of each Asset Coverage Ratio Test Date, permit the Asset Coverage Ratio (i) during any Fiscal Quarter ending on or before March 31, 2021, to be less than 2.00 to 1.00, and (ii) for all Fiscal Quarters thereafter, to be less than 2.50 to 1.00.

Section 6.4. Asset Coverage Ratio (PDP). The Borrower will not, as of each Asset Coverage Ratio Test Date, permit the Asset Coverage Ratio (PDP) (i) during any Fiscal Quarter ending on or before June 30, 2019, to be less than 1.10 to 1.00, (ii) during the Fiscal Quarters ending on September 30, 2019 and December 31, 2019, to be less than 1.15 to 1.00, (iii) during the Fiscal Quarter ending on March 31, 2020, to be less than 1.25 to 1.00, (iv) during the Fiscal Quarters ending on June 30, 2020, September 30, 2020, December 31, 2020, and March 31, 2021, to be less than 1.50 to 1.00, and (vi) for all Fiscal Quarters thereafter, to be less than 1.75 to 1.00.

Section 6.5. Fixed Charge Coverage Ratio. The Borrower will not permit the Fixed Charge Coverage Ratio (i) for the Fiscal Quarter ending June 30, 2019, to be less than 1.35 to 1.00, and (ii) for all Fiscal Quarters thereafter, to be less than 1.40 to 1.00.

Section 6.6. Capital Expenditures. The Loan Parties shall not make Capital Expenditures in any Fiscal Quarter, beginning with the Fiscal Quarter ending June 30, 2019, that would cause the aggregate amount of all Capital Expenditures in such Fiscal Quarter to exceed by more than (i) 10% the amount of Capital Expenditures for such Fiscal Quarter set forth on the then-current and Approved Acquisition and Development Plan, or (ii) 10% the amount of the Capital Expenditures set forth on the then-current and Approved Acquisition and Development Plan in the aggregate.

ARTICLE VII

NEGATIVE COVENANTS

The Borrower covenants and agrees that so long as any Obligation remains outstanding:

Section 7.1. Indebtedness and Preferred Equity. The Borrower will not, and will not permit any Loan Party or any of their respective Subsidiaries to, create, incur, assume or suffer to exist any Indebtedness, except:

(a) Indebtedness created pursuant to the Loan Documents;

(b) Indebtedness of the Borrower owing to any Subsidiary and of any Subsidiary owing to the Borrower or any other Subsidiary; provided that (i) any such Indebtedness shall be subject to Section 7.4, (ii) such Indebtedness is not held, assigned, transferred, negotiated or pledged to any Person other than a Loan Party, and (iii) any such Indebtedness shall be subordinated to the Obligations on terms and conditions satisfactory to the Administrative Agent;

(c) Guarantees by the Borrower of Indebtedness of any Subsidiary and by any Subsidiary Loan Party of Indebtedness of the Borrower or any other Subsidiary; provided that such Indebtedness is otherwise permitted by this Agreement;

(d) Indebtedness of the Borrower and its Subsidiaries associated with bonds or surety obligations required by Governmental Authorities in connection with the operation of the Oil and Gas Properties, including with respect to plugging, facility removal and abandonment of its Oil and Gas Properties, worker’s compensation claims, performance, bid or other surety or bond obligations less than $500,000 in the aggregate;

(e) Hedging Obligations permitted by Section 7.10;

(f) Subject to Section 5.25(a), Indebtedness in the form of (i) accounts payable to trade creditors for goods or services not more than 120 days past due, unless contested in good faith by appropriate proceedings and adequate reserves for such items have been made in accordance with GAAP and (ii) current operating liabilities (other than for borrowed money) which in each case is (x) incurred in the ordinary course of business, as presently conducted and (y) not more than 120 days past due, unless contested in good faith by appropriate proceedings and adequate reserves for such items have been made in accordance with GAAP;

(g) endorsements of negotiable instruments for collection in the ordinary course of business;

(h) Indebtedness constituting Capital Lease Obligations incurred in order to perform the Loan Parties’ obligations under the Offtake Agreement, in an aggregate amount not to exceed $375,000 in the aggregate at any time outstanding; and

(i) other Indebtedness of the Borrower or its Subsidiaries in an aggregate principal amount not to exceed $75,000 at any time outstanding.

The Borrower will not, and will not permit any Subsidiary to, issue any preferred stock or other preferred equity interest that (i) is required to be redeemable in cash or pursuant to a cash sinking fund obligation or (ii) is or may become redeemable or repurchaseable in cash by the Borrower or such Subsidiary, at the option of the holder thereof as holder of such security or of holders thereof as a determined quantity of holders of such securities, in whole or in part, or (iii) is convertible or exchangeable at the option of the holder thereof in their capacity as holder of such securities for Indebtedness or preferred stock or any other preferred equity interest described in this paragraph, on or prior to, in the case of clause (i), (ii) or (iii), the first anniversary of the Maturity Date.

Section 7.2. Liens. The Borrower will not, and will not permit any Loan Party or any of their respective Subsidiaries to, create, incur, assume or suffer to exist any Lien on any of its assets or property now owned or hereafter acquired, except:

(a) Liens securing the Obligations; provided that no Liens may secure Hedging Obligations constituting Obligations without the other Obligations being secured hereunder on a pari passu basis to such Hedging Obligations and subject to the priority of payments set forth in Section 2.20 and Section 8.2 (if such Hedging Obligations are in default resulting in an Event of Default under this Agreement) and the Hedge Intercreditor Agreement;

(b) Excepted Liens; and

Section 7.3. Fundamental Changes.

(a) The Borrower will not, and will not permit any Loan Party or any of their respective Subsidiaries to merge into or consolidate into any other Person, or to consummate a Division as the Dividing Person, or to permit any other Person to merge into or consolidate with it, or sell, lease, transfer or otherwise dispose of (in a single transaction or a series of transactions) all or substantially all of its assets (in each case, whether now owned or hereafter acquired) or all or substantially all of the stock of any of its Subsidiaries (in each case, whether now owned or hereafter acquired) or liquidate or dissolve.

(b) The Borrower will not, and will not permit any Loan Party to, allow any material change to be made in the character of its business as an independent oil and gas exploration and production company. From and after the date hereof, the Borrower will not, and will not permit any Loan Party to, acquire or make any other expenditure (whether such expenditure is capital, operating or otherwise) in or related to any Oil and Gas Properties not onshore and located within the geographical boundaries of the continental United States of America.

(c) Without the prior written consent of the Administrative Agent, the Borrower will not, and will not permit any of its Subsidiaries or any Loan Party to, form or acquire any Subsidiary other than a Subsidiary of which the Borrower or its Subsidiaries own all of the equity securities of such Subsidiary (other than equity attributable to management compensation plans), except for Investments permitted by Section 7.4.

Section 7.4. Investments, Loans. The Borrower will not, and will not permit any Loan Party or any of their respective Subsidiaries to, purchase, hold or acquire (including pursuant to any merger with any Person that was not a wholly owned Subsidiary prior to such merger) any Capital Stock, evidence of Indebtedness (except as permitted in Section 7.1) or other securities (including any option, warrant, or other right to acquire any of the foregoing) of, make or permit to exist any loans or advances to, Guarantee any obligations of, or make or permit to exist any investment or any other interest in, any other Person, or purchase or otherwise acquire (in one transaction or a series of transactions) any assets of any other Person that constitute a business unit, or create or form any Subsidiary (all of the foregoing being collectively called “Investments”), except:

(a) Permitted Investments;

(b) Investments in the form of trade credit to customers of a Loan Party arising in the ordinary course of business and represented by accounts from such customers and accounts receivable arising in the ordinary course of business in the aggregate less than $50,000;

(d) Guarantees by the Borrower and its Subsidiaries constituting Indebtedness permitted by Section 7.1;

(e) Investments made by the Borrower in or to any Subsidiary and by any Subsidiary to the Borrower or in or to another Subsidiary or by Parent in or to the Borrower;

(f) loans or advances to employees, officers or directors of the Borrower or any of its Subsidiaries in the ordinary course of business for travel, relocation and related expenses; provided that the aggregate amount of all such loans and advances does not exceed $50,000 at any time outstanding;

(g) Hedging Transactions permitted by Section 7.10;

(h) Investments by the Borrower and its Subsidiaries (i) in ownership interests in additional Oil and Gas Properties located within the onshore geographic boundaries of the United States of America (including, for the avoidance of doubt, the acquisition of 100% of the Capital Stock of a Person owning such assets) or (ii) related to oil and gas mineral interests and leases owned by a Loan Party or a Person that will become a Loan Party upon acquisition of such Person by a Loan Party, farm-out, farm-in, joint operating, joint venture, participation or area of mutual interest agreements, gathering and processing systems, pipelines and other midstream assets or other similar arrangements in each case, which are related or ancillary to Oil and Gas Properties owned by the Loan Parties and which are usual and customary in the oil and gas exploration and production business located within the geographic boundaries of the United States of America; and

(i) other Investments which in the aggregate do not exceed $500,000 in any Fiscal Year.

Section 7.5. Restricted Payments. The Borrower will not, and will not permit any of its Subsidiaries to, declare or make, or agree to pay or make, directly or indirectly, any Restricted Payment for the Borrower or such Subsidiary, except:

(i) declaring or making, or agreeing to pay or make, dividends payable in such entity’s Capital Stock with respect to a Loan Party or Subsidiary’s Capital Stock;

(ii) Restricted Payments made by any Subsidiary to the Borrower or to another Subsidiary or by the Borrower to any Subsidiary;

(iii) non-cash Restricted Payments pursuant to and in accordance with equity incentive plans or other benefit plans for management or employees or directors of the Borrower and its Subsidiaries approved by the Administrative Agent;

(iv) the repurchase, redemption, acquisition, cancellation or other retirement for value of the Borrower’s Capital Stock and the termination of options to purchase Capital Stock of the Borrower, in each instance, held by a former or current directors, officers and employees (or their estates, spouses or former spouses) of any Loan Party upon their death, disability, retirement or termination of employment for a maximum cash consideration not to exceed $50,000 in any fiscal year; and

(v) Restricted Payments made by Borrower in the amount necessary to pay (or reimburse Parent for the payment of) Parent’s taxes that are attributable to Parent’s ownership of Borrower, in any event in an aggregate amount not to exceed $50,000 per fiscal year.

Section 7.6. Sale of Properties; Termination of Hedging Transactions. The Borrower will not, and will not permit any Loan Party or any of their respective Subsidiaries to, convey, sell, lease, assign, farm-out, transfer or otherwise dispose of any of its Property or, in the case of any Subsidiary, any shares of such Subsidiary’s Capital Stock, in each case whether now owned or hereafter acquired, to any Person other than the Borrower or any other Loan Party (any such transaction, an “Asset Sale”), or terminate or otherwise monetize any Hedging Transaction in respect of commodities, or agree to do any of the foregoing, except:

(a) the Asset Sale or other disposition of equipment that (i) is obsolete, uneconomic or worn out equipment disposed of in the ordinary course of business, (ii) is for fair market value if no longer necessary for business of such Person or (iii) is contemporaneously replaced by equipment of at least comparable value and use;

(b) the Asset Sale of produced Hydrocarbons and Permitted Investments in the ordinary course of business for cash;

(c) the Asset Sale or other disposition of any Oil and Gas Property by the Borrower and its Subsidiaries or any interest therein for cash and the termination or monetization of any Hedging Transaction in respect of commodities; provided that:

(i) no Default exists or, after giving effect to this Section 7.6, results from such Asset Sale of Oil and Gas Property or termination or monetization of any Hedging Transaction in respect of commodities (after giving effect to any prepayment required hereunder) and the Borrower shall be in compliance with the financial covenants in Article VI on a Pro Forma Basis after giving effect to any reduction in the Modified Proved NPV and the consummation of such Asset Sale;

(ii) the Borrower notifies the Administrative Agent and the Lenders not less than (A) ten (10) Business Days prior to such Asset Sale of proved Oil and Gas Property or (B) five (5) Business Days (or such longer time as the Administrative Agent may agree) following the termination or monetization of any Hedging Transaction in respect of commodities;

(iii) 100% of the consideration received in respect of such Asset Sale or termination shall be cash or cash equivalents; provided, however, this requirement shall not apply to the termination or monetization of any Hedging Transaction in accordance with its terms or that is replaced with positions or contracts no less advantageous to the Borrower or the Subsidiary party thereto or has expired or matured in accordance with its terms;

(iv) the consideration received in respect of such Asset Sale or termination or monetization of any Hedging Transaction in respect of commodities (other than the termination or monetization of any Hedging Transaction in accordance with its terms or replaced with positions or contracts no less advantageous to the Borrower or the Subsidiary party thereto) shall be equal to or greater than the fair market value at the time of such Asset Sale of the proved Oil and Gas Property, interest therein or Subsidiary subject of such Asset Sale, or Hedging Transaction subject of such termination or monetization at the time of the termination or monetization of such Hedging Transaction, with such value being subject in each case to applicable transaction expenses, and in the case of any Hedging Transaction applicable breakage or other agreed upon costs, replacement costs, synthetic trading transaction expenses, spreads, costs and related fees to the extent applicable and any other amounts required to be paid pursuant to any master agreement, swap agreement or any annex, schedule or protocol thereto (as reasonably determined by the board of directors (or comparable governing body) of the Borrower, and, if requested by the Administrative Agent, the Borrower shall deliver a certificate of the principal executive officer or the principal financial officer of the Borrower certifying to that effect; provided, however, that nothing herein shall cause the board of directors to be required to obtain or provide a fairness or valuation opinion from an investment bank, valuation firm or similar entity in making such determination); and

(v) (A) such event is not a Triggering Event or (B) such event is a Triggering Event and the Borrower shall have made the payments (within the timeframes), if any, required under Section 2.13(a);

(d) the Asset Sale or other disposition of any Oil and Gas Property that does not constitute proved reserves by the Borrower and its Subsidiaries or any interest therein; provided that: (i) no Default exits and is continuing, (ii) at least 80% of the consideration received in respect of such sale shall be cash or cash equivalents or Permitted Investments, unless the Borrower has received the prior written consent of the Administrative Agent, and (iii) the consideration received in respect of such sale or other disposition shall be equal to or greater than the fair market value of the Oil and Gas Property, interest therein or Subsidiary subject of such sale or other disposition, subject in each case to applicable transaction expenses and breakage or other costs (as reasonably determined by the board of directors (or comparable governing body) of the Borrower and, if requested by the Administrative Agent, the Borrower shall deliver a certificate of the principal executive officer or the principal financial officer of the Borrower certifying to that effect);

(e) transactions permitted by Section 7.5 or Section 7.7, without duplication thereto;

(f) farmouts, swaps or trades of undeveloped acreage and assignments in connection with such farmouts, swaps or trade, in an amount not the exceed $50,000 in the aggregate for any calendar year; and

(g) Asset Sales of non-Oil and Gas Properties (or Property not otherwise used or held for use in connection therewith) not otherwise permitted by this Section 7.6, the aggregate consideration of which shall not exceed $250,000 during the term of this Agreement.

Section 7.7. Transactions with Affiliates. The Borrower will not, and will not permit any Loan Party or any of their respective Subsidiaries to, sell, lease or otherwise transfer any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other transactions with, any of its Affiliates (collectively, “Affiliated Transactions”), except:

(a) Affiliated Transactions between or among the Borrower and its Subsidiaries that are upon fair and reasonable terms that are no less favorable to the Borrower or Subsidiary than it would obtain in a comparable arm’s length transaction with a non-Affiliate;

(b) transactions permitted by Section 7.4 or Section 7.5 provided each such transaction meets the criteria of such provisions;

(d) reimbursement or payment of outside counsel, advisory and transaction fees incurred by Affiliates relating to the operations or business of the Borrower or its Subsidiaries; and

(e) compensation arrangements and customary indemnification agreements for directors (or the members of the comparable governing body), managers, officers and other employees of the Borrower and the other Loan Parties entered into in the ordinary course of business.

For the avoidance of doubt, action by a member of the board of directors of the Borrower or management of the Borrower, by a member thereof, in their capacity as such person, which person is also an Affiliate shall not be deemed an Affiliated Transaction.

Section 7.8. Restrictive Agreements. The Borrower will not, and will not permit any Loan Party or any of their respective Subsidiaries to, directly or indirectly, enter into, incur or permit to exist any agreement that prohibits, restricts or imposes any restrictive condition upon (a) the ability of the Borrower or any of its Subsidiaries to create, incur or permit any Lien upon any of its assets or properties, whether now owned or hereafter acquired, or (b) the ability of any of its Subsidiaries to pay dividends or other distributions with respect to its Capital Stock, to make or repay loans or advances to the Borrower or any other Subsidiary thereof, to Guarantee Indebtedness of the Borrower or any other Subsidiary thereof or to transfer any of its property or assets to the Borrower or any other Subsidiary thereof; provided that clause (a) shall not apply to restrictions or conditions imposed by any agreement relating to secured Indebtedness permitted by this Agreement if such restrictions and conditions apply only to the property or assets securing such Indebtedness.

Section 7.9. Sale and Leaseback Transactions. The Borrower will not, and will not permit any Loan Party or any of their respective Subsidiaries to, enter into any arrangement, directly or indirectly, whereby it shall sell or transfer any property, real or personal, used or useful in its business, whether now owned or hereinafter acquired, and thereafter rent or lease as lessee such property or other property that it intends to use for substantially the same purpose or purposes as the property sold or transferred.

Section 7.10. Hedging Transactions.

(a) The Borrower will not, and will not permit any Loan Party or any of their respective Subsidiaries to, enter into or be a party to any Hedging Transaction, other than as expressly set forth herein. Notwithstanding anything in this section to the contrary, the Borrower and its Subsidiaries shall, subject to clause (b) of this Section 7.10, enter and maintain through the term of this Agreement (i) those Hedging Transactions required pursuant to Section 5.19 and (ii) those Hedging Transactions by the Borrower with an Approved Counterparty in respect of commodities entered into not for speculative purposes the notional volumes for which (when aggregated with other commodity Hedging Transactions then in effect other than basis differential swaps on volumes already hedged pursuant to other Hedging Transactions) do not have the net effect, as of the date of any determination, to be less than (A) for the first thirty-six (36) months after the date of any determination, 85% of the reasonably anticipated production of crude oil, 85% of the reasonably anticipated production of natural gas, 85% of the reasonably anticipated production of natural gas liquids, in each case as such production is projected, for such period, from PDP reserves (as set forth in the most recent Reserve Report delivered pursuant to the terms of this Agreement) calculated separately, on a rolling quarterly basis, and (B) for the period between thirty-six (36) and forty-eight (48) months after the date of determination, 80% of the reasonably anticipated production of crude oil, 80% of the reasonably anticipated production of natural gas, 80% of the reasonably anticipated production of natural gas liquids, in each case as such production is projected, for such period, from PDP reserves (as set forth in the most recent Reserve Report delivered pursuant to the terms of this Agreement) calculated separately for each calendar quarter. Notwithstanding anything in this Agreement to the contrary, Borrower will not, and will not permit any Loan Party or any of their respective Subsidiaries to, enter into or be a party to any Hedging Transaction, in excess of 100% of the reasonably anticipated production of crude oil, 100% of the reasonably anticipated production of natural gas, 100% of the reasonably anticipated production of natural gas liquids, in each case as such production is projected from PDP reserves (as set forth in the most recent Reserve Report delivered pursuant to the terms of this Agreement) calculated separately for each calendar quarter.

(b) The Borrower will not, and will not permit any Loan Party or any of their respective Subsidiaries to, enter into or be a party to any Hedging Transaction, (i) for speculative purposes or (ii) for converting interest rates from floating to fixed, fixed to floating, or any other interest rate hedge transaction.

(c) In no event shall any Hedging Transaction (i) contain any requirement, agreement or covenant for any Loan Party to post collateral or margin to secure their obligations under such Hedging Transaction or to cover market exposures other than Hedging Transactions with the Secured Hedge Parties that are secured by the Collateral Documents pursuant to the terms of this Agreement and the other Loan Documents, (ii) involve a prepayment, a price that is not commercially reasonable or any other pricing arrangement resulting in material credit exposure to either party thereto upon execution thereof, (iii) involve collar that includes calls sold for different periods or volumes as the puts or swaps purchased, (iv) permit any payments owed by any Loan Party in respect of calculation periods that would occur after early termination of such Hedging Transaction to be netted or set-off against any payments owed to any Loan Party for physical Hydrocarbons delivered prior to termination thereof, unless the proceeds of any exercise of any such netting or set-off rights by the Secured Hedge Parties, as applicable, under such Hedging Transaction are required to be shared ratably, on a pari passu basis with the other Secured Parties pursuant to the Hedge Intercreditor Agreement, or (v) include a put spread or “knock out” or any other similar variation that ceases to reduce risk below a certain price.

(d) The Borrower will not terminate or monetize any Hedging Transaction in respect of commodities without the prior written consent of the Majority Lenders, except to the extent such terminations are permitted pursuant to Section 7.6.

Section 7.11. Amendment to Material Documents. Without the prior written consent of the Administrative Agent, the Borrower will not, and will not permit any Loan Party or any of their respective Subsidiaries to, amend, modify or waive any of its rights under (a) any Organizational Documents, (b) any operating agreements affecting the Mortgaged Properties, or (c) any Material Agreements, except in any manner that would not have a material adverse effect on the Lenders, the Administrative Agent, or a Material Adverse Effect on the Borrower and its Subsidiaries taken as a whole.

Section 7.12. Sale or Discount of Receivables. Except for receivables obtained by any Loan Party out of the ordinary course of business or the settlement of joint interest billing accounts in the ordinary course of business or discounts granted to settle collection of accounts receivable or the sale of defaulted accounts arising in the ordinary course of business in connection with the compromise or collection thereof and not in connection with any financing transaction, the Borrower will not, and will not permit any Loan Party or any of their respective Subsidiaries to, discount or sell (with or without recourse) to any Person who is not a Loan Party any of its notes receivable or accounts receivable.

Section 7.13. Accounting Changes. Except with prior written consent of the Administrative Agent, the Borrower will not, and will not permit any Loan Party or any of their respective Subsidiaries to, make any significant change in accounting treatment or reporting practices, except as required by GAAP, or change the Fiscal Year of the Borrower, such Loan Party or of any of their Subsidiaries, except to change the Fiscal Year of a Subsidiary to conform its Fiscal Year to that of the Borrower.

Section 7.14. Lease Obligations. The Borrower will not, and will not permit any Loan Party or any of their respective Subsidiaries to, create or suffer to exist any obligations for the payment under operating leases or agreements to lease (but excluding any obligations under leases required to be classified as Capital Leases under GAAP having a term of five years or more or which do not go beyond the value and terms of the leased property and leases of Hydrocarbon Interests) which would cause the aggregate amount of all payments made by the Borrower and the other Loan Parties pursuant to all such leases or lease agreements, including any residual payments at the end of any lease, on a consolidated basis, to exceed $250,000 in the aggregate in any Fiscal Year.

Section 7.15. Government Regulation. The Borrower will not, and will not permit any Loan Party or any of their respective Subsidiaries to, (a) be or become subject at any time to any enforcement of law, regulation or list of any Governmental Authority of the United States (including, without limitation, the OFAC list) that prohibits or sanctions the Lenders or the Administrative Agent from making any advance or extension of credit to the Borrower or from otherwise conducting business with the Loan Parties, or (b) fail to provide documentary and other evidence of the identity of the Loan Parties as may be requested by the Lenders or the Administrative Agent at any time to enable the Lenders or the Administrative Agent to verify the identity of the Loan Parties or to comply with any applicable law or regulation, including, without limitation, Section 326 of the Patriot Act at 31 U.S.C. Section 5318.

Section 7.16. Gas Imbalances, Take-or-Pay or Other Prepayments. The Borrower will not, and will not permit any Loan Party or any of their respective Subsidiaries to, allow gas imbalances, take-or-pay obligations or other prepayments with respect to the Oil and Gas Properties of any Loan Party that would require such Loan Party to deliver Hydrocarbons on a monthly basis at some future time without then or thereafter receiving full payment therefor to exceed, in the aggregate, $300,000 in any calendar year.

Section 7.17. Marketing Activities. The Borrower will not, and will not permit any Loan Party or any of their respective Subsidiaries to, enter into any contracts for the sale of Hydrocarbons other than (a) contracts for the sale of Hydrocarbons scheduled or reasonably estimated to be produced from the Borrower’s or its Subsidiaries’ proved Oil and Gas Properties during the period of such contract, (b) contracts for the sale of Hydrocarbons scheduled or reasonably estimated to be produced from proved Oil and Gas Properties of third parties during the period of such contract associated with such Oil and Gas Properties of the Borrower or one of its Subsidiaries that the Borrower or one of its Subsidiaries has the right to sell on behalf of such third parties and (c) other contracts for the purchase and/or sale of Hydrocarbons of third parties (i) which have generally offsetting provisions (i.e., corresponding pricing mechanics, delivery dates and points and volumes) such that no “position” is taken and (ii) for which appropriate credit support has been received by the Borrower or applicable Subsidiary to mitigate the material credit risks of the counterparty thereto.

Section 7.18. Non-Qualified ECP Guarantors. The Borrower shall not permit any Loan Party that is not a Qualified ECP Guarantor to enter into any Hedging Agreements.

Section 7.19. Environmental Matters. The Borrower will not, and will not permit any Loan Party or any of their respective Subsidiaries to, cause or permit any of its Property to be in any violation of, or do anything or permit anything to be done which will subject any such Property to a Release or threatened Release of Hazardous Materials in violation of or to any Remedial Work required under, any Environmental Laws, other than to the extent that could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.

Section 7.20. Sanctions and Anti-Corruption Laws.

(a) The Borrower will not, and will not permit any Loan Party or any of their respective Subsidiaries to, request any Loan or, directly or indirectly, use the proceeds of any Loan, or lend , contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other Person (i) to fund, any activities or business of or with any Sanctioned Person or in any Sanctioned Country, or (ii) in any other manner that would result in a violation of Anti-Corruption Laws or applicable sanctions by any Person (including any Person participating in the transaction, whether as the Administrative Agent, any Lender or otherwise).

(b) The Borrower will not, and will not permit any Loan Party or any of their respective Subsidiaries to request any Loan or, directly or indirectly, use the proceeds of any Loan, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other Person, in furtherance of an offer, payment, promise to pay or authorization of the payment or giving of money or anything else of value to any Person in violation of applicable Anti-Corruption Laws.

Section 7.21. G&A Expenses. The Borrower shall not permit its G&A Expenses to exceed $2,750,000 in the aggregate in any fiscal year.

ARTICLE VIII
EVENTS OF DEFAULT

Section 8.1. Events of Default. If any of the following events (each, an “Event of Default”) shall occur and be continuing:

(a) the Borrower or any other Loan Party shall fail to pay any principal of any Loan or any other Obligations under the Guaranty Agreements, when and as the same shall become due and payable, whether at the due date thereof or at a date fixed for prepayment or otherwise; or

(b) the Borrower or any other Loan Party shall fail to pay any interest on any Loan or any fee or any other amount (other than an amount payable under subsection (a) of this Section) payable under this Agreement or any other Loan Document, when and as the same shall become due and payable, and such failure shall continue unremedied for a period of three (3) Business Days; or

(c) any representation or warranty made or deemed made by or on behalf of a Loan Party or any of its Subsidiaries in or in connection with this Agreement or any other Loan Document (including the Schedules attached hereto and thereto), or in any amendments or modifications hereof or waivers hereunder, or in any certificate submitted to the Administrative Agent or the Lenders by any Loan Party pursuant to or in connection with this Agreement or any other Loan Document shall prove to be incorrect in any material respect (other than any representation or warranty that is expressly qualified by a Material Adverse Effect or other materiality, in which case such representation or warranty shall prove to be incorrect in any respect) when made or deemed made or submitted; or

(d) a Loan Party shall fail to observe or perform any covenant or agreement contained in Section 2.3(b), 5.2(a) and 5.2(b), 5.3(a)(i), 5.18, 5.19, 5.23, 5.24, 5.25, or Article VI or VII; or

(e) any Loan Party shall fail to observe or perform any covenant or agreement contained in this Agreement (other than those referred to in subsections (a), (b) and (d) of this Section) or any other Loan Document, and such failure shall remain unremedied for 30 days (or, with respect to (x) Section 5.1(b) and (y) Section 5.1(d) as it pertains to the Compliance Certificate required to be delivered concurrently with the financial statements required by Section 5.1(b), 15 days) after the earlier of (i) any officer of the Borrower becomes aware of such failure, or (ii) notice thereof shall have been given to the Borrower by the Administrative Agent; or

(f) (i) the Borrower, any of its Subsidiaries, or any Loan Party (whether as primary obligor or as guarantor or other surety) shall fail to pay any principal of, or premium or interest on, any Material Indebtedness (other than any Hedging Obligation) that is outstanding, when and as the same shall become due and payable (whether at scheduled maturity, required prepayment, acceleration, demand or otherwise), and such failure shall continue after the applicable grace period, if any, specified in the agreement or instrument evidencing or governing such Indebtedness; or any other event shall occur or condition shall exist under any agreement or instrument relating to any such Material Indebtedness and shall continue after the applicable grace period, if any, specified in such agreement or instrument, if the effect of such event or condition is to accelerate, or permit the acceleration of, the maturity of such Indebtedness prior to the stated maturity thereof; or any such Material Indebtedness shall be declared to be due and payable, or required to be prepaid, purchased, defeased or redeemed (other than by a regularly scheduled required prepayment or redemption) in each case prior to the stated maturity thereof or (ii) there occurs under Hedging Transactions, as to which the Borrower, any of its Subsidiary, or any other Loan Party is a party, an Early Termination Date (as defined in such applicable Hedging Transactions) resulting from (A) any event of default that occurs and is continuing under such Hedging Transactions as to which the Borrower, any of its Subsidiaries, or any other Loan Party is the Defaulting Party (as defined in such Hedging Transaction) and the Hedge Termination Value owed by the Borrower, such Subsidiary, or such other Loan Party as a result thereof, individually or in the aggregate, is greater than $100,000 and is not paid following the notice periods, rights and remedies provided for in the documentation of such Hedging Transactions or (B) any Termination Event (as so defined) under such Hedging Transactions as to which the Borrower or any Subsidiary is an Affected Party (as so defined) and the Hedge Termination Value owed by the Borrower, such Subsidiary, or any other Loan Party as a result thereof is, individually or in the aggregate, greater than $100,000 and is not paid following the notice periods, rights and remedies provided for in the documentation of such Hedging Transactions; or

(g) the Borrower, any of its Subsidiaries, or any other Loan Party shall (i) commence a voluntary case or other proceeding or file any petition seeking liquidation, reorganization or other relief under any federal, state or foreign bankruptcy, insolvency or other similar law now or hereafter in effect or seeking the appointment of a custodian, trustee, receiver, liquidator or other similar official of it or any substantial part of its property, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in subsection (i) of this Section, (iii) apply for or consent to the appointment of a custodian, trustee, receiver, liquidator or other similar official for the Borrower or any such Subsidiary or for a substantial part of its assets, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors, or (vi) take any action for the purpose of effecting any of the foregoing; or

(h) an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of the Borrower, any of its Subsidiaries, or any other Loan Party or its debts, or any substantial part of its assets, under any federal, state or foreign bankruptcy, insolvency or other similar law now or hereafter in effect or (ii) the appointment of a custodian, trustee, receiver, liquidator or other similar official for the Borrower, any of its Subsidiaries, or any other Loan Party or for a substantial part of its assets, and in any such case, such proceeding or petition shall remain undismissed for a period of 60 days or an order or decree approving or ordering any of the foregoing shall be entered; or

(i) the Borrower, any of its Subsidiaries, or any other Loan Party shall generally not pay its debts as such debts become due, or shall admit in writing its inability to pay its debts generally, or shall make a general assignment for the benefit of creditors; or

(j) (i) an ERISA Event shall have occurred that, in the opinion of the Majority Lenders, when taken together with other ERISA Events that have occurred, could reasonably be expected to result in liability to the Borrower, any of its Subsidiaries, or any other Loan Party in an aggregate amount exceeding $100,000, (ii) there is or arises an Unfunded Pension Liability (not taking into account Plans with negative Unfunded Pension Liability) in an aggregate amount exceeding $100,000, or (iii) there is or arises any potential Withdrawal Liability in an aggregate amount exceeding $100,000; or

(k) any final judgment or order by a Government Authority (which cannot be contested by appropriate proceedings) for the payment of money less any insurance proceeds covering such settlements or judgments which are received or as to which the insurance carriers admit liability, in excess of $100,000 in the aggregate (but not including in such aggregate, amounts paid, or appealed as contemplated by this subsection) shall be rendered against the Borrower, any of its Subsidiaries, or any other Loan Party, and either (i) enforcement proceedings shall have been commenced by any creditor upon such judgment or order as a result of nonpayment of such judgment or order in a timely manner or (ii) there shall be a period of 30 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect; or

(l) any non-monetary judgment or order shall be rendered against the Borrower, any of its Subsidiaries, or any other Loan Party that could reasonably be expected, either individually or in the aggregate, to have a Material Adverse Effect, and there shall be a period of 30 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect; or

(m) a Change in Control shall occur or exist; or

(n) any provision of any Collateral Document shall for any reason cease to be valid and binding on, or enforceable against, any Loan Party, or any Loan Party shall so state in writing, or any Loan Party shall seek to terminate its obligation under the Guaranty and Security Agreement or any other Collateral Document (other than the release of any guaranty or collateral to the extent permitted pursuant to the terms of this Agreement or the Collateral Documents including pursuant to Section 9.11); or

(o) with respect to the Collateral Documents, any Lien purported to be created under any Collateral Document shall fail or cease to be, or shall be asserted by any Loan Party not to be, a valid and perfected Lien on any Collateral, with the priority required by the applicable Collateral Documents, subject to the exceptions set forth therein;

then, and in every such event (other than an event with respect to a Loan Party described in subsection (g), (h) or (i) of this Section) and at any time thereafter during the continuance of such event, the Administrative Agent may, and upon the written request of the Majority Lenders shall, by notice to the Borrower, take any or all of the following actions, at the same or different times: (i) declare the principal of and any accrued interest on the Loans, and all other Obligations owing hereunder, to be, whereupon the same shall become, due and payable immediately, without presentment, demand, protest, further notice of intent to accelerate, notice of acceleration, or other notice of any kind (other than as provided in this paragraph), all of which are hereby waived by the Borrower and each Loan Party, (ii) exercise, or cause the Collateral Agent to exercise, all remedies contained in any other Loan Document and (iii) exercise, or cause the Collateral Agent to exercise, any other remedies available at law or in equity; provided that, if an Event of Default specified in either subsection (g), ‎(h), or (i) shall occur, the principal of the Loans then outstanding, together with accrued interest thereon, and all fees and all other Obligations shall automatically become due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower and each Loan Party.

Section 8.2. Application of Proceeds from Collateral. All proceeds from each sale of, or other realization upon, all or any part of the Collateral by any Secured Party after an Event of Default arises and during its continuance shall be applied as follows:

(a) first, to the reimbursable expenses of the Administrative Agent and the Collateral Agent incurred in connection with such sale or other realization upon the Collateral, until the same shall have been paid in full;

(b) second, to the fees and other reimbursable expenses of the Administrative Agent then due and payable pursuant to any of the Loan Documents, until the same shall have been paid in full;

(c) third, to all reimbursable expenses, if any, of the Lenders then due and payable pursuant to any of the Loan Documents, until the same shall have been paid in full;

(d) fourth, to the fees and interest then due and payable under the terms of this Agreement, until the same shall have been paid in full;

(e) fifth, to the payment of principal outstanding on the Loans;

(f) sixth, to any other Outstanding obligations; and

(g) seventh, to the extent any proceeds remain, to the Borrower and the other Loan Parties or their successors or assigns or as otherwise provided by a court of competent jurisdiction.

All amounts allocated pursuant to the foregoing clauses third through sixth to the Lenders as a result of amounts owed to the Lenders under the Loan Documents shall be allocated among, and distributed to, the Lenders pro rata based on their respective Pro Rata Shares.

Notwithstanding the foregoing, no amount received from any Guarantor (including any proceeds of any sale of, or other realization upon, all or any part of the Collateral owned by such Guarantor) shall be applied to any Excluded Swap Obligation of such Guarantor.

ARTICLE IX

THE ADMINISTRATIVE AGENT and the Collateral Agent

Section 9.1. Appointment of the Administrative Agent and the Collateral Agent.

(a) Each Lender irrevocably appoints AEP I XXXXX LLC as the Administrative Agent and authorizes it to take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent under this Agreement and the other Loan Documents, together with all such actions and powers that are reasonably incidental thereto. The Administrative Agent may perform any of its duties hereunder or under the other Loan Documents by or through any one or more sub-agents or attorneys-in-fact appointed by the Administrative Agent. The Administrative Agent and any such sub-agent or attorney-in-fact may perform any and all of its duties and exercise its rights and powers through their respective Related Parties. The exculpatory provisions set forth in this Article shall apply to any such sub-agent, attorney-in-fact or Related Party and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as the Administrative Agent.

(b) Each Lender irrevocably appoints the Administrative Agent as the Collateral Agent, and authorizes it to take such actions on its behalf and to exercise such powers as are delegated to the Collateral Agent under this Agreement and the other Loan Documents, together with all such actions and powers that are reasonably incidental thereto. Each Lender irrevocably delegates to the Administrative Agent the right to replace or appoint a successor Collateral Agent from time to time upon notice to the Borrower and the Lenders. Upon the acceptance of its appointment as the Collateral Agent hereunder by a successor, such successor Collateral Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Collateral Agent, and the retiring Collateral Agent shall be discharged from its duties and obligations under this Agreement and the other Loan Documents. Each right or benefit accruing in favor of the Administrative Agent shall apply to each instance in which the Administrative Agent was acting in its capacity as the Collateral Agent including, without limitation, those rights and benefits pursuant to this ARTICLE IX and Section 10.3.

Section 9.2. Nature of Duties of the Administrative Agent. The Administrative Agent shall not have any duties or obligations except those expressly set forth in this Agreement and the other Loan Document, and its duties hereunder and thereunder shall be purely administrative in nature. Without limiting the generality of the foregoing, (a) the Administrative Agent shall not be subject to any fiduciary or other implied duties, regardless of whether a Default or an Event of Default has occurred and is continuing, (b) the Administrative Agent shall not have any duty to take any discretionary action or exercise any discretionary powers, except those discretionary rights and powers expressly contemplated by the Loan Documents that the Administrative Agent is required to exercise in writing by the Majority Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 10.2), provided that the Administrative Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose the Administrative Agent to liability or that is contrary to any Loan Document or applicable law, including for the avoidance of doubt any action that may be in violation of the automatic stay under any Debtor Relief Law or that may effect a forfeiture, modification or termination of property of a Defaulting Lender in violation of any Debtor Relief Law; and (c) except as expressly set forth in the Loan Documents, the Administrative Agent shall not have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrower or any of its Subsidiaries that is communicated to or obtained by the Administrative Agent or any of its Affiliates in any capacity. The Administrative Agent shall not be liable for any action taken or not taken by it, its sub-agents or its attorneys-in-fact with the consent or at the request of the Majority Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be necessary, under the circumstances as provided in Section 10.2 and Section 8.1) or in the absence of its own gross negligence or willful misconduct as determined by a court of competent jurisdiction by final and nonappealable judgment. The Administrative Agent shall not be responsible for the negligence or misconduct of any sub-agents or attorneys-in-fact except to the extent that a court of competent jurisdiction determines in a final nonappealable judgment that the Administrative Agent acted with gross negligence or willful misconduct in the selection of such sub-agent or attorneys-in-fact. The Administrative Agent shall not be deemed to have knowledge of any Default or Event of Default unless and until written notice thereof (which notice shall include an express reference to such event being a “Default” or “Event of Default” hereunder) is given to the Administrative Agent by the Borrower or any Lender, and the Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with any Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements, or other terms and conditions set forth in any Loan Document, (iv) the validity, enforceability, effectiveness or genuineness of any Loan Document or any other agreement, instrument or document, or (v) the satisfaction of any condition set forth in Article III or elsewhere in any Loan Document, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent. The Administrative Agent may consult with legal counsel (including counsel for the Borrower), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance the advice of any such counsel, account or experts.

Section 9.3. Lack of Reliance on the Administrative Agent. Each of the Lenders acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each of the Lenders also acknowledges that it will, independently and without reliance upon the Administrative Agent, or any other Lender and based on such documents and information as it has deemed appropriate, continue to make its own decisions in taking or not taking any action under or based on this Agreement, any related agreement or any document furnished hereunder or thereunder.

Section 9.4. Certain Rights of the Administrative Agent. If the Administrative Agent shall request instructions from the Majority Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be necessary, under the circumstances as provided in Section 10.2 and Section 8.1) with respect to any action or actions (including the failure to act) in connection with this Agreement, the Administrative Agent shall be entitled to refrain from such act or taking such act unless and until it shall have received instructions from such Lenders, and the Administrative Agent shall not incur liability to any Person by reason of so refraining. Without limiting the foregoing, no Lender shall have any right of action whatsoever against the Administrative Agent as a result of the Administrative Agent acting or refraining from acting hereunder in accordance with the instructions of the Majority Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be necessary, under the circumstances as provided in Section 10.2 and Section 8.1) where required by the terms of this Agreement.

Section 9.5. Reliance by the Administrative Agent. The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, posting or other distribution) believed by it to be genuine and to have been signed, sent or made by the proper Person. The Administrative Agent may also rely upon any statement made to it orally or by telephone and believed by it to be made by the proper Person and shall not incur any liability for relying thereon. The Administrative Agent may consult with legal counsel (including counsel for the Borrower), independent public accountants and other experts selected by it and shall not be liable for any action taken or not taken by it in accordance with the advice of such counsel, accountants or experts.

Section 9.6. The Administrative Agent in its Individual Capacity. The bank serving as the Administrative Agent shall have the same rights and powers under this Agreement and any other Loan Document in its capacity as a Lender as any other Lender and may exercise or refrain from exercising the same as though it were not the Administrative Agent; and the terms “Lenders”, “Majority Lenders”, or any similar terms shall, unless the context clearly otherwise indicates, include the Administrative Agent in its individual capacity. The lender acting as the Administrative Agent and its Affiliates may accept deposits from, lend money to, and generally engage in any kind of business with the Borrower or any Subsidiary or Affiliate of the Borrower as if it were not the Administrative Agent hereunder.

Section 9.7. Successor Administrative Agent.

(a) The Administrative Agent may resign at any time by giving notice thereof to the Lenders and the Borrower. Upon any such resignation, the Majority Lenders shall have the right to appoint a successor Administrative Agent. If no successor Administrative Agent shall have been so appointed, and shall have accepted such appointment within 30 days after the retiring Administrative Agent gives notice of resignation, then the retiring Administrative Agent may, on behalf of the Lenders, appoint a successor Administrative Agent which shall be a commercial bank organized under the laws of the United States or any state thereof or a bank which maintains an office in the United States.

(b) Upon the acceptance of its appointment as the Administrative Agent hereunder by a successor, such successor Administrative Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent, and the retiring Administrative Agent shall be discharged from its duties and obligations under this Agreement and the other Loan Documents. If, within 45 days after written notice is given of the retiring Administrative Agent’s resignation under this Section, no successor Administrative Agent shall have been appointed and shall have accepted such appointment, then on such 45^th day (i) the retiring Administrative Agent’s resignation shall become effective, (ii) the retiring Administrative Agent shall thereupon be discharged from its duties and obligations under the Loan Documents and (iii) the Majority Lenders shall thereafter perform all duties of the retiring Administrative Agent under the Loan Documents until such time as the Majority Lenders appoint a successor Administrative Agent as provided above. After any retiring Administrative Agent’s resignation hereunder, the provisions of this Article shall continue in effect for the benefit of such retiring Administrative Agent and its representatives and agents in respect of any actions taken or not taken by any of them while it was serving as the Administrative Agent.

Section 9.8. Withholding Tax. To the extent required by any applicable law, the Administrative Agent may withhold from any interest payment to any Lender an amount equivalent to any applicable withholding tax. If the Internal Revenue Service or any authority of the United States or any other jurisdiction asserts a claim that the Administrative Agent did not properly withhold tax from amounts paid to or for the account of any Lender (because the appropriate form was not delivered or was not properly executed, or because such Lender failed to notify the Administrative Agent of a change in circumstances that rendered the exemption from, or reduction of, withholding tax ineffective, or for any other reason), such Lender shall indemnify the Administrative Agent (to the extent that the Administrative Agent has not already been reimbursed by the Borrower and without limiting the obligation of the Borrower to do so) fully for all amounts paid, directly or indirectly, by the Administrative Agent as tax or otherwise, including penalties and interest, together with all expenses incurred, including legal expenses, allocated staff costs and any out of pocket expenses.

Section 9.9. The Administrative Agent May File Proofs of Claim.

(a) In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding relative to any Loan Party, the Administrative Agent (irrespective of whether the principal of any Loan or any Credit Exposure shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand on the Borrower) shall be entitled and empowered, by intervention in such proceeding or otherwise:

(i) to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans or Credit Exposure and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders and the Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of the Lenders and the Administrative Agent and its agents and counsel and all other amounts due the Lenders and the Administrative Agent under Section 10.3) allowed in such judicial proceeding; and

(ii) to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same.

(b) Any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender to make such payments to the Administrative Agent and, if the Administrative Agent shall consent to the making of such payments directly to the Lenders, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative Agent under Section 10.3.

Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopt on behalf of any Lender any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender or to authorize the Administrative Agent to vote in respect of the claim of any Lender in any such proceeding.

Section 9.10. Authorization to Execute Other Loan Documents. Each Lender hereby authorizes the Administrative Agent to execute on behalf of all Lenders all Loan Documents (including, without limitation, the Collateral Documents and any subordination agreements) other than this Agreement.

Section 9.11. Collateral and Guaranty Matters. The Lenders irrevocably authorize the Administrative Agent, at its option and in its discretion:

(a) to release any Lien on any property granted to or held by the Collateral Agent under any Loan Document (i) upon the termination of all Commitments and the payment in full of all Obligations (other than contingent indemnification obligations), (ii) that is sold or to be sold as part of or in connection with any sale permitted hereunder or under any other Loan Document, including Section 7.6, or (iii) if approved, authorized or ratified in writing in accordance with Section 10.2; and

(b) to release any Loan Party from its obligations under the applicable Collateral Documents if such Person ceases to be a Subsidiary as a result of a transaction permitted hereunder.

Upon request by the Collateral Agent at any time, the Majority Lenders will confirm in writing the Collateral Agent’s authority to release its interest in particular types or items of property, or to release any Loan Party from its obligations under the applicable Collateral Documents pursuant to this Section. In each case as specified in this Section, the Collateral Agent is authorized, at the Borrower’s expense, to execute and deliver to the applicable Loan Party such documents as such Loan Party may reasonably request to evidence the release of such item of Collateral from the Liens granted under the applicable Collateral Documents, or to release such Loan Party from its obligations under the applicable Collateral Documents, in each case in accordance with the terms of the Loan Documents and this Section.

Section 9.12. Right to Realize on Collateral and Enforce Guarantee. Anything contained in any of the Loan Documents to the contrary notwithstanding, the Borrower, the Administrative Agent and each Lender hereby agree that (i) no Lender shall have any right individually to realize upon any of the Collateral or to enforce the Collateral Documents, it being understood and agreed that all powers, rights and remedies hereunder and under the Collateral Documents may be exercised solely by the Collateral Agent on behalf of the Lenders in accordance with the terms hereof and the Collateral Documents, and (ii) in the event of a foreclosure by the Collateral Agent on any of the Collateral pursuant to a public or private sale or other disposition, the Administrative Agent or any Lender may be the purchaser or licensor of any or all of such Collateral at any such sale or other disposition and the Collateral Agent, as agent for and representative of the Lenders (but not any Lender or Lenders in its or their respective individual capacities unless the Majority Lenders shall otherwise agree in writing), shall be entitled, for the purpose of bidding and making settlement or payment of the purchase price for all or any portion of the Collateral sold at any such public sale, to use and apply any of the Obligations as a credit on account of the purchase price for any collateral payable by the Collateral Agent at such sale or other disposition.

Section 9.13. Reserved.

Section 9.14. Authority to Release Guarantors, Collateral and Liens. Each Lender hereby authorizes the Collateral Agent to release any Collateral that the Collateral Agent is permitted or required to release pursuant to Section 7.6 or that is otherwise permitted to be sold or released pursuant to the terms of the Loan Documents, to confirm that expired leases and plugged and abandoned xxxxx are no longer Collateral, and to release from the Collateral Documents any Guarantor that is permitted to be sold or disposed of, pursuant to the terms of the Loan Documents. Each Lender hereby authorizes the Collateral Agent to execute and deliver to a Loan Party, at such Loan Party’s sole cost and expense, any and all releases of Guaranty and Collateral Agreements, Liens, termination statements, assignments or other documents reasonably requested by such Loan Party in connection with any sale or other disposition of Property to the extent such sale or other disposition or the release of such Collateral is permitted by the terms of Section 7.6 or is otherwise authorized by the terms of the Loan Documents.

ARTICLE X

MISCELLANEOUS

Section 10.1. Notices.

(a) Written Notices.

(i) Except in the case of notices and other communications expressly permitted to be given by telephone, all notices and other communications to any party herein to be effective shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopy, as follows:

To the Borrower:	Samson Oil and Gas USA, Inc.
	0000 00^xx Xxxxxx, Xxxxx 000
	Xxxxxx, Xxxxxxxx 00000
	Attention: Xxxxx Xxxx
	Telephone: (000) 000-0000
	Facsimile: (000) 000-0000
	E-mail: Xxxxx.Xxxx@XxxxxxXxxxxxXxx.xxx

To the Administrative Agent:	AEP I XXXXX LLC
	0 X. 00xx Xxxxxx
	0xx Xxxxx
	Xxx Xxxx, XX 00000
	Attention: Xxxxx Xxxxx
	Telephone: (000) 000-0000
	Facsimile: (000) 000-0000
	E-mail: xxxxxx@xxxxxxx.xxx

To the initial Lender:	AEP I XXXXX LLC
	0 X. 00xx Xxxxxx
	0xx Xxxxx
	Xxx Xxxx, XX 00000
	Attention: Xxxxx Xxxxx
	Telephone: (000) 000-0000
	Facsimile: (000) 000-0000
	E-mail: xxxxxx@xxxxxxx.xxx

To any other Lender:	the address set forth in the Administrative Questionnaire or the Assignment and Acceptance executed by such Lender

Any party hereto may change its address or telecopy number for notices and other communications hereunder by notice to the other parties hereto. All such notices and other communications shall be effective upon actual receipt by the relevant Person or, if delivered by overnight courier service, upon the first Business Day after the date deposited with such courier service for overnight (next-day) delivery or, if sent by telecopy, upon transmittal in legible form by facsimile machine or, if mailed, upon the third Business Day after the date deposited into the mail or, if delivered by hand, upon delivery; provided that notices delivered to the Administrative Agent shall not be effective until actually received by such Person at its address specified in this Section. The Administrative Agent or the Borrower may, in their discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications as provided in Section 10.1(b).

(ii) Any agreement of the Administrative Agent or any Lender herein to receive certain notices by telephone or facsimile is solely for the convenience and at the request of the Borrower. The Administrative Agent and each Lender shall be entitled to rely on the authority of any Person purporting to be a Person authorized by the Borrower to give such notice and the Administrative Agent and the Lenders shall not have any liability to the Borrower or other Person on account of any action taken or not taken by the Administrative Agent or any Lender in reliance upon such telephonic or facsimile notice. The obligation of the Borrower to repay the Loans and all other Obligations hereunder shall not be affected in any way or to any extent by any failure of the Administrative Agent or any Lender to receive written confirmation of any telephonic or facsimile notice or the receipt by the Administrative Agent or any Lender of a confirmation which is at variance with the terms understood by the Administrative Agent and such Lender to be contained in any such telephonic or facsimile notice.

(b) Electronic Communications.

(i) Notices and other communications to the Lenders hereunder may be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites) pursuant to procedures approved by the Administrative Agent, provided that the foregoing shall not apply to notices to any Lender pursuant to Article II unless such Lender and the Administrative Agent have agreed to receive notices under any Section thereof by electronic communication and have agreed to the procedures governing such communications. The Administrative Agent or the Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications.

(ii) Unless the Administrative Agent otherwise prescribes, (A) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement) and (B) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause (A) of notification that such notice or communication is available and identifying the website address therefor; provided that, in the case of clauses (A) and (B) above, if such notice or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next Business Day for the recipient.

Section 10.2. Waiver; Amendments.

(a) No failure or delay by the Administrative Agent or any Lender in exercising any right or power hereunder or under any other Loan Document, and no course of dealing between the Borrower and the Administrative Agent or any Lender, shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such right or power, preclude any other or further exercise thereof or the exercise of any other right or power hereunder or thereunder. The rights and remedies of the Administrative Agent and the Lenders hereunder and under the other Loan Documents are cumulative and are not exclusive of any rights or remedies provided by law. No waiver of any provision of this Agreement or of any other Loan Document or consent to any departure by the Borrower therefrom shall in any event be effective unless the same shall be permitted by subsection (b) of this Section, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. Without limiting the generality of the foregoing, the making of a Loan shall not be construed as a waiver of any Default or Event of Default, regardless of whether the Administrative Agent or any Lender may have had notice or knowledge of such Default or Event of Default at the time.

(b) No amendment or waiver of any provision of this Agreement or of the other Loan Documents, nor consent to any departure by the Borrower therefrom, shall in any event be effective unless the same shall be in writing and signed by the Borrower and the Majority Lenders, or the Borrower and the Administrative Agent with the consent of the Majority Lenders, and then such amendment, waiver or consent shall be effective only in the specific instance and for the specific purpose for which given; provided that, in addition to the consent of the Majority Lenders, no amendment, waiver or consent shall:

(i) increase the Commitment of any Lender without the written consent of such Lender;

(ii) reduce the principal amount of any Loan or reduce the rate of interest thereon, or reduce any fees payable hereunder, without the written consent of each Lender entitled to such payment;

(iii) postpone the date fixed for any payment of any principal of, or interest on, any Loan or any fees hereunder or reduce the amount of, waive or excuse any such payment, without the written consent of each Lender entitled to such payment, or postpone the scheduled date for the termination or reduction of the Commitment of any Lender, without the written consent of such Lender;

(iv) change Section 2.22(b) or (c) in a manner that would alter the pro rata sharing of payments required thereby, without the written consent of each Lender;

(v) change any of the provisions of this subsection (b) or the definition of “Majority Lenders” or any other provision of this Agreement specifying the number or percentage of Lenders which are required to waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder, without the consent of each Lender;

(vi) release all or substantially all of the guarantors, or limit the liability of such guarantors, under any guaranty agreement guaranteeing any of the Obligations, without the written consent of each Lender; or

(vii) release all or substantially all collateral (if any) securing any of the Obligations, without the written consent of each Lender;

provided, further, that no such amendment, waiver or consent shall amend, modify or otherwise affect the rights, duties or obligations of the Administrative Agent without the prior written consent of such Person.

Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder, except that the Commitment of such Lender may not be increased or extended, and amounts payable to such Lender hereunder may not be permanently reduced, without the consent of such Lender (other than reductions in fees and interest in which such reduction does not disproportionately affect such Lender). Notwithstanding anything contained herein to the contrary, this Agreement may be amended and restated without the consent of any Lender (but with the consent of the Borrower and the Administrative Agent) if, upon giving effect to such amendment and restatement, such Lender shall no longer be a party to this Agreement (as so amended and restated), the Commitments of such Lender shall have terminated (but such Lender shall continue to be entitled to the benefits of Sections 2.17, 2.18, 2.19 and 10.3), such Lender shall have no other commitment or other obligation hereunder and such Lender shall have been paid in full all principal, interest and other amounts owing to it or accrued for its account under this Agreement.

Section 10.3. Expenses; Indemnification.

(a) The Borrower shall pay (i) all reasonable, out-of-pocket costs and expenses incurred by the Administrative Agent, including the reasonable fees and expenses of counsel for the Administrative Agent, in connection with the syndication of the credit facility provided for herein, the preparation and administration of the Loan Documents and any amendments, modifications or waivers thereof (whether or not the transactions contemplated in this Agreement or any other Loan Document shall be consummated), and (ii) all out-of-pocket costs and expenses (including, without limitation, the reasonable fees, charges and disbursements of such one primary outside counsel) incurred by the Administrative Agent or any Lender in connection with the enforcement or protection of its rights in connection with this Agreement, including its rights under this Section, or in connection with the Loans made, including all such out-of-pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans.

(b) The Borrower shall indemnify the Administrative Agent (and any sub-agent thereof), each Lender, and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and expenses (including, without limitation, the reasonable fees of counsel for the Indemnitees (but limited to one (1) legal counsel for all such Indemnitees collectively and, to the extent necessary, one (1) local counsel in each relevant jurisdiction and one (1) regulatory counsel if reasonably required for all such Indemnitees collectively and, if necessary, in the case of an actual or perceived conflict of interest as determined in good faith by legal counsel for the Indemnitees, one additional counsel (and, if necessary, one regulatory counsel and one local counsel in each relevant jurisdiction) to each group of similarly situated affected Indemnitees)), incurred by any Indemnitee arising out of or relating to (i) the execution or delivery of this Agreement, any other Loan Document or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto of their respective obligations hereunder or thereunder or the consummation of the transactions contemplated hereby or thereby, (ii) any Loan or the use or proposed use of the proceeds therefrom, (iii) any actual or alleged presence or Release of Hazardous Materials on or from any property owned or operated by the Borrower or any of its Subsidiaries, or any Environmental Liability related in any way to the Borrower or any of its Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by the Borrower or any other Loan Party, regardless of whether any Indemnitee is a party thereto, IN ALL CASES, WHETHER OR NOT CAUSED BY OR ARISING, IN WHOLE OR IN PART, OUT OF THE COMPARATIVE CONTRIBUTORY OR SOLE NEGLIGENCE OF THE INDEMNITEE; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses are determined by a court of competent jurisdiction by final and non-appealable judgment to have resulted (x) from the gross negligence, bad faith or willful misconduct of such Indemnitee, (y) a dispute solely among Indemnitees provided that such claim does not involve an act or omission of any Loan Party and such claim is not brought against the Administrative Agent, in its capacity as such, or (z) a claim brought by the Borrower or any other Loan Party against an Indemnitee for breach in bad faith of such Indemnitee’s obligations hereunder. This Section 10.3 shall not apply with respect to Taxes other than Taxes that represent losses, claims or damages arising from any non-Tax claim.

(c) The Borrower shall pay, and hold the Administrative Agent and each of the Lenders harmless from and against, any and all present and future stamp, documentary, and other similar taxes with respect to this Agreement and any other Loan Documents, any collateral described therein or any payments due thereunder, and save the Administrative Agent and each Lender harmless from and against any and all liabilities with respect to or resulting from any delay or omission to pay such taxes.

(d) To the extent that the Borrower fails to pay any amount required to be paid to the Administrative Agent under subsection (a), (b) or (c) hereof, each Lender severally agrees to pay to the Administrative Agent such Lender’s pro rata share (in accordance with its respective Commitment (or Credit Exposure, as applicable) determined as of the time that the unreimbursed expense or indemnity payment is sought) of such unpaid amount; provided that the unreimbursed expense or indemnified payment, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent in its capacity as such.

(e) To the extent permitted by applicable law, the Borrower, the Administrative Agent and the Lenders, and the other parties hereto, shall not assert, and each hereby waives, any claim against the others (including any Indemnitee), on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to actual or direct damages) arising out of, in connection with or as a result of this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the transactions contemplated herein or therein, any Loan or the use of proceeds thereof.

(f) All amounts due under this Section shall be payable promptly after written demand therefor.

Section 10.4. Successors and Assigns.

(a) The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Administrative Agent and each Lender. Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in subsection (d) of this Section and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative Agent and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

(b) Any Lender may at any time assign to one or more assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitments, Loans and other Credit Exposure at the time owing to it); provided that any such assignment shall be subject to the following conditions:

(i) Minimum Amounts.

(A) in the case of an assignment of the entire remaining amount of the assigning Lender’s Commitments, Loans and other Credit Exposure at the time owing to it or in the case of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum amount need be assigned; and

(B) in any case not described in subsection (b)(i)(A) of this Section, the aggregate amount of the Commitment (which for this purpose includes Loans and Credit Exposure outstanding thereunder) or, if the applicable Commitment is not then in effect, the principal outstanding balance of the Loans and Credit Exposure of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Acceptance with respect to such assignment is delivered to the Administrative Agent or, if “Trade Date” is specified in the Assignment and Acceptance, as of the Trade Date) shall not be less and $100,000 and in minimum increments of $100,000, unless the Administrative Agent otherwise consents (such consent not to be unreasonably withheld or delayed).

(ii) Proportionate Amounts. Each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement with respect to the Loans, other Credit Exposure or the Commitments assigned.

(iii) Required Consents. No consent shall be required for any assignment except to the extent required by subsection (b)(i)(B) of this Section.

(iv) Assignment and Acceptance. The parties to each assignment shall deliver to the Administrative Agent (A) a duly executed Assignment and Acceptance, (B) a processing and recordation fee of $3,500, (C) an Administrative Questionnaire unless the assignee is already a Lender and (D) the documents required under Section 2.21.

(v) No Assignment to the certain Persons. No such assignment shall be made to (A) the Borrower or any of the Borrower’s Affiliates or Subsidiaries or (B) to any Defaulting Lender or any of its Subsidiaries, or any Person who, upon becoming a Lender hereunder, would constitute any of the foregoing Persons described in this clause (B).

(vi) No Assignment to Natural Persons. No such assignment shall be made to a natural person.

(vii) Certain Additional Payments. In connection with any assignment of rights and obligations of any Defaulting Lender hereunder, no such assignment shall be effective unless and until, in addition to the other conditions thereto set forth herein, the parties to the assignment shall make such additional payments to the Administrative Agent in an aggregate amount sufficient, upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of participations or subparticipations, or other compensating actions, including funding, the applicable pro rata share of Loans previously requested but not funded by the Defaulting Lender, to each of which the applicable assignee and assignor hereby irrevocably consent), to (x) pay and satisfy in full all payment liabilities then owed by such Defaulting Lender to the Administrative Agent and each other Lender hereunder (and interest accrued thereon), and (y) acquire (and fund as appropriate) its full pro rata share of all Loans. Notwithstanding the foregoing, in the event that any assignment of rights and obligations of any Defaulting Lender hereunder shall become effective under applicable law without compliance with the provisions of this paragraph, then the assignee of such interest shall be deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance occurs.

Subject to acceptance and recording thereof by the Administrative Agent pursuant to subsection (c) of this Section, from and after the effective date specified in each Assignment and Acceptance, the assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Acceptance, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Acceptance, be released from its obligations under this Agreement (and, in the case of an Assignment and Acceptance covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits of Section 2.19, Section 2.20 and Section 2.21 and Section 10.3 with respect to facts and circumstances occurring prior to the effective date of such assignment; provided that, except to the extent otherwise expressly agreed by the affected parties, no assignment by a Defaulting Lender will constitute a waiver or release of any claim of any party hereunder arising from such Lender’s having been a Defaulting Lender. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this subsection shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with subsection (d) of this Section.

(c) The Administrative Agent, acting solely for this purpose as an agent of the Borrower, shall maintain at one of its offices in New York, New York, a copy of each Assignment and Acceptance delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amount of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the “Register”). Information contained in the Register with respect to any Lender shall be available for inspection by such Lender at any reasonable time and from time to time upon reasonable prior notice; information contained in the Register shall also be available for inspection by the Borrower at any reasonable time and from time to time upon reasonable prior notice.

(d) Any Lender may at any time, without the consent of, or notice to, the Borrower or the Administrative Agent, sell participations to any Person (other than a natural person, the Borrower or any of the Borrower’s Affiliates or Subsidiaries) (each, a “Participant”) in all or a portion of such Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the Loans owing to it); provided that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the Borrower, the Administrative Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement.

Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver that is described in clauses (i) through (x) of Section 10.2(b) and that directly affects such Participant. the Borrower agrees that each Participant shall be entitled to the benefits of Section 2.19, Section 2.20 and Section 2.21, to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to subsection (b) of this Section; provided that such Participant (A) agrees to be subject to Section 2.23 as though it were an assignee under subsection (b) of this Section; and (B) shall not be entitled to receive any greater payment under Section 2.19 or Section 2.21 , with respect to any participation, than its participating Lender would have been entitled to receive, except to the extent such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation.

Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register in the United States on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under the Loan Documents (the “Participant Register”). The entries in the Participant Register shall be conclusive, absent manifest error, and such Lender shall treat each person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. The Borrower and the Administrative Agent shall have inspection rights to such Participant Register (upon reasonable prior notice to the applicable Lender) solely for purposes of demonstrating that such Loans or other obligations under the Loan Documents are in “registered form” for purposes of the Code.

(e) Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that no such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

Section 10.5. Governing Law; Jurisdiction; Consent to Service of Process.

(a) This Agreement and the other Loan Documents and any claims, controversy, dispute or cause of action (whether in contract or tort or otherwise) based upon, arising out of or relating to this Agreement or any other Loan Document (except, as to any other Loan Document, as expressly set forth therein) and the transactions contemplated hereby and thereby shall be construed in accordance with and be governed by the law (without giving effect to the conflict of law principles thereof) of the State of New York (including Section 5-1401 and Section 5-1402 of the General Obligations Law of the State of New York).

(b) EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE Non-EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK, AND OF ANY APPELLATE COURT THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH COURTS OR, TO THE EXTENT PERMITTED BY APPLICABLE LAW, SUCH APPELLATE COURTS. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement or any other Loan Document shall affect any right that the Administrative Agent or any Lender may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against the Borrower or its properties in the courts of any jurisdiction.

(c) Each party hereto irrevocably and unconditionally waives any objection which it may now or hereafter have to the laying of venue of any such suit, action or proceeding described in subsection (b) of this Section and brought in any court referred to in subsection (b) of this Section. Each of the parties hereto irrevocably waives, to the fullest extent permitted by applicable law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

(d) Each party to this Agreement irrevocably consents to the service of process in the manner provided for notices in Section 10.1. Nothing in this Agreement or in any other Loan Document will affect the right of any party hereto to serve process in any other manner permitted by law.

Section 10.6. WAIVER OF JURY TRIAL. EACH PARTY HERETO IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

Section 10.7. Right of Set-off. In addition to any rights now or hereafter granted under applicable law and not by way of limitation of any such rights, each Lender shall have the right, at any time or from time to time upon the occurrence and during the continuance of an Event of Default, without prior notice to the Borrower, any such notice being expressly waived by the Borrower to the extent permitted by applicable law, to set off and apply against all deposits (general or special, time or demand, provisional or final) of the Borrower at any time held or other obligations at any time owing by such Lender to or for the credit or the account of the Borrower against any and all Obligations held by such Lender, irrespective of whether such Lender shall have made demand hereunder and although such Obligations may be unmatured; provided that in the event that any Defaulting Lender shall exercise any such right of setoff, (x) all amounts so set off shall be paid over immediately to the Administrative Agent for further application in accordance with the provisions of Section 2.24(a) and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of the Administrative Agent and the Lenders, and (y) the Defaulting Lender shall provide promptly to the Administrative Agent a statement describing in reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised such right of setoff. Each Lender agrees promptly to notify the Administrative Agent and the Borrower after any such set-off and any application made by such Lender; provided that the failure to give such notice shall not affect the validity of such set-off and application. Each Lender agrees to apply all amounts collected from any such set-off to the Obligations before applying such amounts to any other Indebtedness or other obligations owed by the Borrower and any of its Subsidiaries to such Lender. Notwithstanding anything herein to the contrary, there shall be no right of set-off with respect to reserve accounts established by any Loan Party attributable to third party working interest or royalty interest owners to the extent of amounts held in such account that belong to third party working interest and royalty interest owners.

Section 10.8. Counterparts; Integration. This Agreement may be executed by one or more of the parties to this Agreement on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument. This Agreement, the other Loan Documents, and any separate letter agreements relating to any fees payable to the Administrative Agent and its Affiliates constitute the entire agreement among the parties hereto and thereto and their affiliates regarding the subject matters hereof and thereof and supersede all prior agreements and understandings, oral or written, regarding such subject matters. Delivery of an executed counterpart to this Agreement or any other Loan Document by facsimile transmission or by electronic mail in pdf format shall be as effective as delivery of a manually executed counterpart hereof.

Section 10.9. Survival. All covenants, agreements, representations and warranties made by the Borrower herein and in the certificates, reports, notices or other instruments delivered in connection with or pursuant to this Agreement shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of this Agreement and the other Loan Documents and the making of any Loans, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Administrative Agent or any Lender may have had notice or knowledge of any Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan or any fee or any other amount payable under this Agreement is outstanding and unpaid. The provisions of Section 2.19, 2.18, 2.19(c), and 10.3 and Article IX shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans, the expiration or termination of the Commitments or the termination of this Agreement or any provision hereof.

Section 10.10. Severability. Any provision of this Agreement or any other Loan Document held to be illegal, invalid or unenforceable in any jurisdiction, shall, as to such jurisdiction, be ineffective to the extent of such illegality, invalidity or unenforceability without affecting the legality, validity or enforceability of the remaining provisions hereof or thereof; and the illegality, invalidity or unenforceability of a particular provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

Section 10.11. Confidentiality. Each of the Administrative Agent and the Lenders agrees to take normal and reasonable precautions to maintain the confidentiality of any information relating to the Borrower or any of its Subsidiaries or any of their respective businesses, to the extent designated in writing as confidential and provided to it by the Borrower or any of its Subsidiaries, other than any such information that is available to the Administrative Agent or any Lender on a non-confidential basis prior to disclosure by the Borrower or any of its Subsidiaries, except that such information may be disclosed (i) to any Related Party of the Administrative Agent or any such Lender or any lender or credit provider to the Administrative Agent or any such Lender, including in all of such cases, without limitation, accountants, legal counsel and other advisors of any such Persons, (ii) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, (iii) to the extent requested by any regulatory agency or authority purporting to have jurisdiction over it (including any self-regulatory authority such as the National Association of Insurance Commissioners), (iv) to the extent that such information becomes publicly available other than as a result of a breach of this Section, or which becomes available to the Administrative Agent, any Lender or any Related Party of any of the foregoing on a non-confidential basis from a source other than the Borrower or any of its Subsidiaries, (v) in connection with the exercise of any remedy hereunder or under any other Loan Documents or any suit, action or proceeding relating to this Agreement or any other Loan Documents or the enforcement of rights hereunder or thereunder, (vi) subject to execution by such Person of an agreement containing provisions substantially the same as those of this Section, to (A) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement, or (B) any actual or prospective party (or its Related Parties) to any swap or derivative or other transaction under which payments are to be made by reference to the Borrower and its obligations, this Agreement or payments hereunder, (vii) to any rating agency, (viii) to the CUSIP Service Bureau or any similar organization, or (ix) with the consent of the Borrower. Any Person required to maintain the confidentiality of any information as provided for in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such information as such Person would accord its own confidential information. In the event of any conflict between the terms of this Section and those of any other Contractual Obligation entered into with any Loan Party (whether or not a Loan Document), the terms of this Section shall govern.

Section 10.12. Interest Rate Limitation. Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to any Loan, together with all fees, charges and other amounts which may be treated as interest on such Loan under applicable law (collectively, the “Charges”), shall exceed the maximum lawful rate of interest (the “Maximum Rate”) which may be contracted for, charged, taken, received or reserved by a Lender holding such Loan in accordance with applicable law, the rate of interest payable in respect of such Loan hereunder, together with all Charges payable in respect thereof, shall be limited to the Maximum Rate and, to the extent lawful, the interest and Charges that would have been payable in respect of such Loan but were not payable as a result of the operation of this Section shall be cumulated and the interest and Charges payable to such Lender in respect of other Loans or periods shall be increased (but not above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the Federal Funds Rate to the date of repayment (to the extent permitted by applicable law), shall have been received by such Lender.

Section 10.13. Waiver of Effect of Corporate Seal. The Borrower represents and warrants that neither it nor any other Loan Party is required to affix its corporate seal to this Agreement or any other Loan Document pursuant to any Requirement of Law, agrees that this Agreement is delivered by the Borrower under seal and waives any shortening of the statute of limitations that may result from not affixing the corporate seal to this Agreement or such other Loan Documents.

Section 10.14. Patriot Act. The Administrative Agent and each Lender hereby notifies the Loan Parties that, pursuant to the requirements of the Patriot Act, it is required to obtain, verify and record information that identifies each Loan Party, which information includes the name and address of such Loan Party and other information that will allow such Lender or the Administrative Agent, as applicable, to identify such Loan Party in accordance with the Patriot Act.

Section 10.15. No Advisory or Fiduciary Responsibility. In connection with all aspects of each transaction contemplated hereby (including in connection with any amendment, waiver or other modification hereof or of any other Loan Document), the Borrower and each other Loan Party acknowledges and agrees and acknowledges its Affiliates’ understanding that (i) (A) the services regarding this Agreement provided by the Administrative Agent and/or the Lenders are arm’s-length commercial transactions between the Borrower, each other Loan Party and their respective Affiliates, on the one hand, and the Administrative Agent and the Lenders, on the other hand, (B) each of the Borrower and the other Loan Parties have consulted their own legal, accounting, regulatory and tax advisors to the extent they have deemed appropriate, and (C) the Borrower and each other Loan Party is capable of evaluating and understanding, and understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents; (ii) (A) each of the Administrative Agent and the Lenders is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary for the Borrower, any other Loan Party or any of their respective Affiliates, or any other Person, and (B) none of the Administrative Agent and the Lenders have no obligation to the Borrower, any other Loan Party or any of their Affiliates with respect to the transaction contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents; and (iii) the Administrative Agent, the Lenders and their respective Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Borrower, the other Loan Parties and their respective Affiliates, and each of the Administrative Agent and the Lenders has no obligation to disclose any of such interests to the Borrower, any other Loan Party or any of their respective Affiliates. To the fullest extent permitted by law, each of the Borrower and the other Loan Parties hereby waives and releases any claims that it may have against the Administrative Agent or any Lender with respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transaction contemplated hereby.

Section 10.16. Acknowledgment and Consent to Bail-In of EEA Financial Institutions. Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any EEA Financial Institution arising under any Loan Document may be subject to the write-down and conversion powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

(a) the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an EEA Financial Institution; and

(b) the effects of any Bail-In Action on any such liability, including, if applicable:

(i) a reduction in full or in part or cancellation of any such liability;

(ii) a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent entity, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or

(c) the variation of the terms of such liability in connection with the exercise of the write-down and conversion powers of any EEA Resolution Authority.

Section 10.17. Collateral Matters; Hedge Agreements. The benefit of the Security Instruments and of the provisions of this Agreement relating to any collateral securing the Obligations shall also extend to and be available to the Secured Hedge Parties (but subject to the terms of the Loan Documents, including provisions thereof relating to the application and priority of payments to the Persons entitled thereto) in respect of any Secured Hedging Obligations. Except as expressly provided herein or in the Hedge Intercreditor Agreement, no Secured Hedge Party shall have any voting rights under any Loan Document as a result of the existence of Secured Hedging Obligations owed to it.

Section 10.18. INTERCREDITOR AGREEMENTS.

(a) EACH LENDER HEREBY (I) INSTRUCTS AND AUTHORIZES THE ADMINISTRATIVE AGENT TO EXECUTE AND DELIVER THE HEDGE INTERCREDITOR AGREEMENT ON ITS BEHALF, (II) AUTHORIZES AND DIRECTS THE ADMINISTRATIVE AGENT TO EXERCISE ALL OF THE ADMINISTRATIVE AGENT’S RIGHTS AND TO COMPLY WITH ALL OF ITS OBLIGATIONS UNDER THE HEDGE INTERCREDITOR AGREEMENT, (III) AGREES THAT THE ADMINISTRATIVE AGENT MAY TAKE ACTIONS ON ITS BEHALF AS IS CONTEMPLATED BY THE TERMS OF THE HEDGE INTERCREDITOR AGREEMENTS, AND (IV) UNDERSTANDS, ACKNOWLEDGES AND AGREES THAT AT ALL TIMES FOLLOWING THE EXECUTION AND DELIVERY OF THE HEDGE INTERCREDITOR AGREEMENT SUCH LENDER (AND EACH OF ITS SUCCESSORS AND ASSIGNS) SHALL BE BOUND BY THE TERMS THEREOF.

(b) EACH LENDER ACKNOWLEDGES THAT IT HAS REVIEWED AND IS SATISFIED WITH THE TERMS AND PROVISIONS OF THE HEDGE INTERCREDITOR AGREEMENT AND ACKNOWLEDGES AND AGREES THAT SUCH LENDER IS RESPONSIBLE FOR MAKING ITS OWN ANALYSIS AND REVIEW OF THE HEDGE INTERCREDITOR AGREEMENT AND THE TERMS AND PROVISIONS THEREOF, AND NEITHER THE ADMINISTRATIVE AGENT NOR ANY OF ITS AFFILIATES MAKES ANY REPRESENTATION TO ANY LENDER AS TO THE SUFFICIENCY OR ADVISABILITY OF THE PROVISIONS CONTAINED IN THE HEDGE INTERCREDITOR AGREEMENT.

[Remainder of page left intentionally blank.]

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of the day and year first above written.

	BORROWER:

	SAMSON OIL AND GAS USA, INC., a Colorado corporation

	By:
	Name:	Xxxxx Xxxx
	Title:	President, Treasurer and Chief Executive Officer

Signature Page to Credit Agreement

	ADMINISTRATIVE AGENT:

	AEP I XXXXX LLC

	By:
	Name:	Xxxxx Xxxxx
	Title:	President

Signature Page to Credit Agreement

	LENDER:

	AEP I XXXXX LLC

	By:
	Name:	Xxxxx Xxxxx
	Title:	President

Signature Page to Credit Agreement

Maximum Loan Amounts

Lender	Pro Rata Share			Maximum Loan Amount
AEP I XXXXX LLC		100	%	$	33,500,000
TOTAL		100	%	$	33,500,000

Schedule I to Credit Agreement

EXHIBIT A

Form of Assignment Agreement

This Assignment Agreement (the “Assignment”) is dated as of the Effective Date set forth below and is entered into by and between [Insert name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the “Assignee”). Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement identified below (as it may be amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), receipt of a copy of which is hereby acknowledged by the Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment as if set forth herein in full.

For an agreed consideration, the Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below, the interest in and to all of the Assignor’s rights and obligations under the Credit Agreement and any other documents or instruments delivered pursuant thereto that represents the amount and percentage interest identified below of all of the Assignor’s outstanding rights and obligations under the respective facilities identified below (including, to the extent included in any such facilities) (the “Assigned Interest”). Such sale and assignment is without recourse to the Assignor and, except as expressly provided in this Assignment and the Credit Agreement, without representation or warranty by the Assignor.

1. Assignor:

2. Assignee:

3. Borrower:	Samson Oil and Gas USA Inc., a Colorado corporation

4. Administrative Agent:	AEP I XXXXX LLC, as Administrative Agent under the Credit Agreement

5. Credit Agreement:	Credit Agreement dated as of April 9, 2019, by and among the Borrower, the Administrative Agent, the Collateral Agent, and the Lenders from time to time parties thereto

6. Assigned Interest:

Aggregate Amount of Commitment/ Loans for all Lenders	Amount of Commitment/ Loans Assigned	Percentage Assigned of Commitment Loans
$_______	$__________	_____%
$_______	$__________	_____%
$_______	$__________	_____%

Exhibit A – Page 1

Effective Date: ______________, 20__ [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]

7. Notice and Wire Instructions:


[NAME OF ASSIGNOR]		[NAME OF ASSIGNEE]

Notices:		Notices:



	Attention:		Attention:
	Telecopier:		Telecopier:

with a copy to:		with a copy to:



	Attention:		Attention:
	Telecopier:		Telecopier:

Wire Instructions:		Wire Instructions:

The terms set forth in this Assignment are hereby agreed to:

	ASSIGNOR:

	[NAME OF ASSIGNOR]

	By:
	Name:
	Title:

	ASSIGNEE:

	[NAME OF ASSIGNEE]

	By:
	Name:
	Title:

Exhibit A – Page 2

Consented to:

AEP I XXXXX LLC,
as Administrative Agent

By:
Name:
Title:

Exhibit A – Page 3

ANNEX 1

STANDARD TERMS AND CONDITIONS FOR ASSIGNMENT
AGREEMENT

1. Representations and Warranties.

1.1 Assignor. The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and to consummate the transactions contemplated hereby; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with any Loan Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Credit Agreement or any other instrument or document delivered pursuant thereto, other than this Assignment (herein collectively the “Loan Documents”), or any collateral thereunder, (iii) the financial condition of the Borrower, any of its Subsidiaries or Affiliates or any other Person obligated in respect of any Loan Document or (iv) the performance or observance by the Borrower, any of its Subsidiaries or Affiliates or any other Person of any of their respective obligations under any Loan Document.

1.2 Assignee. The Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) it meets all requirements of an eligible assignee under the Credit Agreement, (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement and, to the extent of the Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it has received a copy of the Credit Agreement and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and to purchase the Assigned Interest on the basis of which it has made such analysis and decision, and (v) if it is a Non-US Lender, attached to the Assignment is any documentation required to be delivered by it pursuant to the terms of the Credit Agreement, duly completed and executed by the Assignee; and (b) agrees that (i) it will, independently and without reliance on the Administrative Agent, the Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at that time, continue to make its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender.

2. Payments. From and after the Effective Date, the Administrative Agent shall make all payments in respect of the Assigned Interest (including payments of principal, interest, fees and other amounts) to the Assignor for amounts which have accrued to but excluding the Effective Date and to the Assignee for amounts which have accrued from and after the Effective Date.

3. General Provisions. This Assignment shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns. This Assignment may be executed in any number of counterparts, which together shall constitute one instrument. Delivery of an executed counterpart of a signature page of this Assignment by telecopy shall be effective as delivery of a manually executed counterpart of this Assignment. This Assignment shall be governed by, and construed in accordance with, the internal laws of the State of New York without regard to conflict of laws principles thereof.

Exhibit A – Page 4

EXHIBIT B

[Form of]

NOTE

Principal Amount: $[__________]

______________, 2019

FOR VALUE RECEIVED, the undersigned Borrower (the “Borrower”) promises, jointly and severally, to pay to [______________] (the “Lender”), at the Applicable Lending Office or such other place as the Lender or any holder hereof may from time to time designate, the principal sum of up to [________________________ AND __/100 DOLLARS ($[____________]), or such lesser principal amount as may be outstanding from time to time, in United States Dollars and in immediately available funds as provided in that certain Credit Agreement, dated April 9, 2019, among the Borrower, the Administrative Agent, the Collateral Agent, and the Lenders party thereto from time to time (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), together with interest on the unpaid principal amount hereof from time to time outstanding, at the rates and on the dates set forth in the Credit Agreement. Capitalized terms used herein and not otherwise defined herein are used with the respective meanings attributed to them in the Credit Agreement.

This Note is issued pursuant to, and is entitled to the benefits of, the Credit Agreement. Reference hereby is made thereto for a statement of the terms and conditions under which this Note may be prepaid or its maturity date accelerated. This Note is entitled to the benefits of each Guaranty and is secured pursuant to the terms of the Credit Agreement and certain other Loan Documents and reference is made thereto for a statement of the terms and provisions thereof. Interest shall be calculated on the basis of a three hundred sixty (360) day year and actual days elapsed, except as set forth in the Credit Agreement.

If any payment of principal or interest is not made when due hereunder (after giving effect to any applicable grace period), or if any other Event of Default shall occur for any reason, or if the Credit Agreement shall be terminated or not renewed for any reason whatsoever, then and in any such event, in addition to all rights and remedies of the Lender under the Credit Agreement or any other Loan Document, applicable law or otherwise, all such rights and remedies being cumulative and enforceable alternatively, successively and concurrently, the Lender may, at its option, declare any and all of the Borrower’s obligations, liabilities and indebtedness owing by the Borrower under this Note, the Credit Agreement and any other Loan Document (collectively, the “Obligations”) to be due and payable, whereupon the then unpaid balance thereof, together with all interest accrued thereon or expenses incurred in connection therewith shall forthwith become due and payable, together with all interest accruing thereafter at the rate set forth in the Credit Agreement until the Obligations, plus all costs and expenses of collection hereof, including, without limitation, reasonable attorneys’ fees and expenses, are indefeasibly paid in full in cash.

The Borrower shall pay all of the Lender’s costs and expenses (including, without limitation, all reasonable attorneys’ fees and expenses) incurred in connection with the enforcement of or preservation of rights under this Note on the terms provided in the Credit Agreement.

No delay or omission on the part of the Lender in exercising any right hereunder shall operate as a waiver of such right or of any other right of the Lender, nor shall any delay, omission or waiver on any one occasion be deemed a bar to or waiver of the same or any other right on any future occasion. The Borrower and every indorser or guarantor of this Note regardless of the time, order or place of signing waive presentment, demand, protest and notices of every kind and assent to any extension or postponement of the time of payment or any other indulgence, to any substitution, exchange or release of Collateral, and to the addition or release of any other Person primarily or secondarily liable.

Exhibit B – Page 1

None of the terms or provisions of this Note may be excluded, modified, or amended except by a written instrument duly executed by the Lender expressly referring hereto and setting forth the provision so excluded, modified or amended. This Note shall be binding upon the successors and assigns of the Borrower and inure to the benefit of the Lender and its successors, endorsees and assigns. If any term or provision of this Note shall be held to be invalid or unenforceable, in whole or in part in any jurisdiction, then such invalidity or unenforceability shall only effect such term or provision, and shall not effect such term or provision in any other jurisdiction or any other term or provision of this Note.

THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OR CHOICE OF LAWS) AND THIS NOTE SHALL BE DEEMED TO BE MADE UNDER SEAL.

Notwithstanding all other provisions of the Credit Agreement and this Note, none of the terms and provisions of the Credit Agreement or this Note shall ever be construed to create a contract to pay Lender, for the use, forbearance or detention of money, interest in excess of the Maximum Rate, and the Borrower shall never be required to pay interest in excess of the Maximum Rate. If for any reason interest is paid in excess of such maximum amount (whether as a result of the payment of this Note prior to its maturity or otherwise), then promptly upon any determination that such excess has been paid, Lender will, at its option, either refund such excess to the Borrower or apply such excess to amounts owing under the Credit Agreement or this Note all in accordance with the provisions set forth under the Credit Agreement.

THIS WRITTEN NOTE, TOGETHER WITH THE CREDIT AGREEMENT AND THE LOAN DOCUMENTS, REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.

THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.

Exhibit B – Page 2

IN WITNESS WHEREOF, the Borrower has executed this Note as of the date first above written.

	BORROWER:

	SAMSON OIL AND GAS USA INC., a Colorado corporation

	By:
	Name:
	Title:

Exhibit B – Page 3

EXHIBIT 2.4

[Form of]

Notice of Borrowing
_______________, 20___

AEP I XXXXX LLC
0 X. 00^xx Xxxxxx, 0^xx Xxxxx

Xxx Xxxx, Xxx Xxxx 00000

Attention: Xxxxx Xxxxx

Re: Samson Oil and Gas USA Inc. (the “Borrower”)

Reference is made to that certain Credit Agreement dated as of April 9, 2019 (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) between the Borrower, the Administrative Agent, the Collateral Agent, and the Lenders party thereto from time to time. Capitalized terms used herein and not otherwise defined herein are used with the meanings attributable to them as defined in the Credit Agreement.

This is a Notice of Borrowing being delivered in accordance with the Loan Agreement. The Borrower requests that Lenders make an advance under the Loan Agreement in the amount of $_______________________ [minimum of $[________]] to be advanced on _________________, 201____ [must be a Business Day at least three (3) Business Days from the date of this notice if a LIBOR Loan is requested] and that the proceeds be paid to the following account:

Bank Name:
ABA Number:
Account Name:
Account #:
For Credit To:

Purpose of the Funding:

The undersigned hereby certifies that no Event of Default currently exists under the Credit Agreement or any other Loan Documents and all representations and warranties set forth in the Credit Agreement and such other Loan Documents are true and correct in all material respects on and as of the date hereof (except to the extent such representation and warranty is expressly stated to relate to a specific earlier date in which case such representation and warranty shall be true and correct in all material respects as of such earlier date) and all conditions precedent to such borrowing have been satisfied (or will be satisfied prior to such borrowing).

Date: __________________, 20____

Exhibit 2.4 – Page 1

	SAMSON OIL AND GAS USA INC., a Colorado corporation

	By:
	Name:
	Title:

Exhibit 2.4 – Page 2

EXHIBIT 2.20A

[FORM OF]

U.S. TAX COMPLIANCE CERTIFICATE
(For Foreign Lenders That Are Not Partnerships For U.S. Federal Income Tax Purposes)

Reference is made to that certain Credit Agreement, dated as of April 9, 2019 (together with all amendments, if any, from time to time made thereto, the “Credit Agreement”), among Samson Oil and Gas USA Inc., a Colorado corporation (“Borrower”), the Lenders from time to time party thereto, the Collateral Agent, and AEP I XXXXX LLC, as Administrative Agent (the “Administrative Agent”). Terms defined in the Credit Agreement are used herein with the same meanings.

Pursuant to the provisions of Section 2.20 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record and beneficial owner of the Loan(s) (as well as any promissory note(s) evidencing such Loan(s)) in respect of which it is providing this certificate, (ii) it is not a bank within the meaning of Section 881(c)(3)(A) of the Code, (iii) it is not a ten percent shareholder of the Borrower within the meaning of Section 881(c)(3)(B) of the Code and (iv) it is not a controlled foreign corporation related to the Borrower as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished the Administrative Agent and the Borrower with a certificate of its non-U.S. Person status on IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable. By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform the Borrower and the Administrative Agent, and (2) the undersigned shall have at all times furnished the Borrower and the Administrative Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

[NAME OF LENDER]

By:
Name:
Title:

Date: ________ __, 20____

Exhibit 2.20 - Page 1

EXHIBIT 2.20B

[FORM OF]

U.S. TAX COMPLIANCE CERTIFICATE
(For Foreign Participants That Are Not Partnerships For U.S. Federal Income Tax Purposes)

Pursuant to the provisions of Section 2.20 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record and beneficial owner of the participation in respect of which it is providing this certificate, (ii) it is not a bank within the meaning of Section 881(c)(3)(A) of the Code, (iii) it is not a ten percent shareholder of the Borrower within the meaning of Section 881(c)(3)(B) of the Code, and (iv) it is not a controlled foreign corporation related to the Borrower as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished its participating Lender with a certificate of its non-U.S. Person status on IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable. By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform such Lender in writing, and (2) the undersigned shall have at all times furnished such Lender with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

[NAME OF PARTICIPANT]

By:
Name:
Title:

Date: ________ __, 20____

Exhibit 2.20 - Page 2

EXHIBIT 2.20C

[FORM OF]

U.S. TAX COMPLIANCE CERTIFICATE
(For Foreign Participants That Are Partnerships For U.S. Federal Income Tax Purposes)

Pursuant to the provisions of Section 2.20 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record owner of the participation in respect of which it is providing this certificate, (ii) its direct or indirect partners/members are the sole beneficial owners of such participation, (iii) with respect to such participation, neither the undersigned nor any of its direct or indirect partners/members is a bank extending credit pursuant to a Credit Agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of its direct or indirect partners/members is a ten percent shareholder of the Borrower within the meaning of Section 871(h)(3)(B) of the Code and (v) none of its direct or indirect partners/members is a controlled foreign corporation related to the Borrower as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished its participating Lender with IRS Form W-8IMY accompanied by one of the following forms from each of its partners/members that is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, or (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption. By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform such Lender and (2) the undersigned shall have at all times furnished such Lender with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

[NAME OF PARTICIPANT]

By:
Name:
Title:

Date: ________ __, 20____

Exhibit 2.20 - Page 3

EXHIBIT 2.20D

[FORM OF]

U.S. TAX COMPLIANCE CERTIFICATE
(For Foreign Lenders That Are Partnerships For U.S. Federal Income Tax Purposes)

Pursuant to the provisions of Section 2.20 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record owner of the Loan(s) (as well as any promissory note(s) evidencing such Loan(s)) in respect of which it is providing this certificate, (ii) its direct or indirect partners/members are the sole beneficial owners of such Loan(s) (as well as any promissory note(s) evidencing such Loan(s)), (iii) with respect to the extension of credit pursuant to this Credit Agreement or any other Loan Document, neither the undersigned nor any of its direct or indirect partners/members is a bank extending credit pursuant to a Credit Agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of its direct or indirect partners/members is a ten percent shareholder of the Borrower within the meaning of Section 881(c)(3)(B) of the Code and (v) none of its direct or indirect partners/members is a controlled foreign corporation related to the Borrower as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished the Administrative Agent and the Borrower with IRS Form W-8IMY accompanied by one of the following forms from each of its partners/members that is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN or Form W-8BEN-E, as applicable, or (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN or IRS W-8BEN-E, as applicable, from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption. By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform the Borrower and the Administrative Agent, and (2) the undersigned shall have at all times furnished the Borrower and the Administrative Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

[NAME OF LENDER]

By:
Name:
Title:

Date: ________ __, 20____

Exhibit 2.20 - Page 4

EXHIBIT 5.1(c)

Form of Borrower Compliance Certificate

In connection with that certain Credit Agreement, dated as of April 9, 2019 (as thereafter amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and among Samson Oil and Gas USA Inc., a Colorado corporation (the “Borrower”), the Lenders from time to time party thereto, the Collateral Agent, and AEP I XXXXX LLC, as administrative agent (the “Administrative Agent”), the Borrower, does hereby certify, pursuant to Section 5.1(d) of the Credit Agreement, as follows (capitalized terms hereinafter used having the meaning specified in the Credit Agreement):

1. In accordance with Section 5.1(a), Section 5.1(b), and Section 5.1(c) of the Credit Agreement, the consolidated financial statements of the [Parent and its Subsidiaries]/[Borrower and its Subsidiaries] as of ________________, 20___, and other information sent to you under separate cover, present fairly in all material respects in accordance with its historical accounting methodologies consistently applied their financial position and earnings at such date.

2. [No condition or event which constitutes a Default or an Event of Default has occurred and is continuing.]

[A condition or event which constitutes a Default or an Event of Default has occurred since the previous delivery of the Compliance Certificate, and below describes the details of such condition or event and the action taken or proposed to be taken with respect thereto:

_________________________________________________________________

________________________________________________________________.]

3. [No change in accounting methodology used in previous financial statements delivered to Administrative Agent and Lenders or in the application thereof has occurred since the date of the financials most recently delivered pursuant to Section 5.1(a) and Section 5.1(b) of the Credit Agreement.]

[A change in the accounting methodology used in previous financial statements delivered to the Administrative Agent and the Lenders or the application thereof has occurred since the date of the financials most recently delivered pursuant to Section 5.1(a) of the Credit Agreement, and the effect of such change on the financial statements accompanying this certificate is as follows:

________________________________________________________________________

______________________________________________________________________.]

4. [There has been no change in the identity of the Subsidiaries since the date of the financials most recently delivered pursuant to Section 5.1(a), Section 5.1(b), and Section 5.1(c) of the Credit Agreement.]

[There has been a change in the identity of the Subsidiaries since the date of the financials most recently delivered pursuant to Section 5.1(a), Section 5.1(b), and Section 5.1(c) of the Credit Agreement, which change is as follows:

________________________________________________________________________

______________________________________________________________________.]

Exhibit 5.1(c) – Page 1

5. In compliance with Article VI of the Credit Agreement, as of the date of the financial statements delivered concurrently with this Compliance Certificate,

(a)

The Leverage Ratio is [____ to 1.00]. The required Leverage Ratio shall not exceed to [____ to 1.00].

(b)

The Current Ratio is [____ to 1.00]. The Current Ratio shall not be less than [___ to 1.00].

(c)

The Asset Coverage Ratio is [____to 1.00]. The Asset Coverage Ratio shall not be less than [___ to 1.00].

(d)

The Asset Coverage Ratio (PDP) is [____ to 1.00]. The Asset Coverage Ratio (PDP) shall not be less than [___ to 1.00].

(e)

The Fixed Charge Coverage Ratio is [____to 1.00]. The Fixed Charge Coverage Ratio shall not be greater than [___ to 1.00], as of the last day of any Fiscal Quarter.

(f)

The amount contained in the Reserve Account is [$_____].

Attached hereto as Schedule I are true, accurate and complete copies of supporting documentation substantiating the calculations set forth above in paragraph 5 and verifying each Borrower’s compliance with the terms and provisions of the Credit Agreement.

[Signature page follows]

Exhibit 5.1(c) – Page 2

IN WITNESS WHEREOF, the undersigned have executed this certificate as of this ______ day of _________________, 201___.

	BORROWER:

	SAMSON OIL AND GAS USA INC., a Colorado corporation

	By:
	Name:
	Title:

Exhibit 5.1(c) – Page 3

Schedule I

Financial Covenant Supporting Documentation

(to be attached)

Exhibit 5.1(c) – Page 4

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Table of Contents

CREDIT AGREEMENT dated as of April 9, 2019 among SAMSON OIL AND GAS USA, INC., as Borrower THE LENDERS FROM TIME TO TIME PARTY HERETO and AEP I FINCO LLC, as Administrative Agent

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