REASONABLY BE EXPECTED TO RESULT IN
A MATERIAL ADVERSE EFFECT, IS QUALIFIED TO DO BUSINESS IN, AND IS IN GOOD
STANDING IN, EVERY JURISDICTION WHERE SUCH QUALIFICATION IS REQUIRED.
SECTION 4.02.
AUTHORIZATION; ENFORCEABILITY. THE TRANSACTIONS ARE
WITHIN EACH CREDIT PARTY'S CORPORATE, LIMITED LIABILITY COMPANY OR PARTNERSHIP
POWERS AND HAVE BEEN DULY AUTHORIZED BY ALL NECESSARY CORPORATE, LIMITED
LIABILITY COMPANY OR PARTNERSHIP AND, IF REQUIRED, STOCKHOLDER ACTION. THIS
AGREEMENT HAS BEEN DULY EXECUTED AND DELIVERED BY EACH CREDIT PARTY AND
49
CONSTITUTES A LEGAL, VALID AND BINDING OBLIGATION OF EACH CREDIT PARTY,
ENFORCEABLE IN ACCORDANCE WITH ITS TERMS, SUBJECT TO APPLICABLE BANKRUPTCY,
INSOLVENCY, REORGANIZATION, MORATORIUM OR OTHER LAWS AFFECTING CREDITORS' RIGHTS
GENERALLY AND SUBJECT TO GENERAL PRINCIPLES OF EQUITY, REGARDLESS OF WHETHER
CONSIDERED IN A PROCEEDING IN EQUITY OR AT LAW.
SECTION 4.03.
GOVERNMENTAL APPROVALS; NO CONFLICTS. THE TRANSACTIONS
(A) DO NOT REQUIRE ANY CONSENT OR APPROVAL OF, REGISTRATION OR FILING WITH, OR
ANY OTHER ACTION BY, ANY GOVERNMENTAL AUTHORITY, EXCEPT SUCH AS HAVE BEEN
OBTAINED OR MADE AND ARE IN FULL FORCE AND EFFECT AND, AFTER THE EFFECTIVE DATE,
THE FILING OF THE CREDIT AGREEMENT AND RELATED LOAN DOCUMENTS BY THE BORROWER
WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO THE REQUIREMENTS OF THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, (B) WILL NOT VIOLATE ANY APPLICABLE
LAW OR REGULATION OR THE CHARTER, BY-LAWS OR OTHER ORGANIZATIONAL DOCUMENTS OF
THE BORROWER OR ANY RESTRICTED SUBSIDIARY OR ANY ORDER OF ANY GOVERNMENTAL
AUTHORITY, (C) WILL NOT VIOLATE OR RESULT IN A DEFAULT UNDER ANY INDENTURE,
AGREEMENT OR OTHER INSTRUMENT EVIDENCING MATERIAL INDEBTEDNESS OR A MATERIAL
SALES CONTRACT BINDING UPON THE BORROWER OR ANY RESTRICTED SUBSIDIARY OR ANY OF
THEIR RESPECTIVE ASSETS, OR GIVE RISE TO A RIGHT THEREUNDER TO REQUIRE ANY
PAYMENT TO BE MADE BY THE BORROWER OR ANY RESTRICTED SUBSIDIARY, AND (D) WILL
NOT RESULT IN THE CREATION OR IMPOSITION OF ANY LIEN ON ANY ASSET OF THE
BORROWER OR ANY RESTRICTED SUBSIDIARY NOT OTHERWISE PERMITTED UNDER SECTION
7.02.
SECTION 4.04.
FINANCIAL CONDITION; NO MATERIAL ADVERSE CHANGE.
(A)
THE BORROWER HAS HERETOFORE FURNISHED TO THE LENDERS THE UNAUDITED
CONSOLIDATED BALANCE SHEET AND RELATED STATEMENTS OF INCOME AND CASH FLOWS OF
THE BORROWER AND ITS CONSOLIDATED SUBSIDIARIES AS OF AND FOR THE NINE (9) MONTH
PERIOD ENDED SEPTEMBER 30, 2005 CERTIFIED BY A RESPONSIBLE OFFICER. SUCH
FINANCIAL STATEMENTS PRESENT FAIRLY, IN ALL MATERIAL RESPECTS, THE FINANCIAL
POSITION AND RESULTS OF OPERATIONS AND CASH FLOWS OF THE BORROWER AND ITS
CONSOLIDATED SUBSIDIARIES AS OF SUCH DATES AND FOR SUCH PERIODS IN ACCORDANCE
WITH GAAP, SUBJECT TO YEAR-END AUDIT ADJUSTMENTS AND THE ABSENCE OF FOOTNOTES.
(B)
SINCE SEPTEMBER 30, 2005, THERE HAS BEEN NO MATERIAL ADVERSE
CHANGE IN THE BUSINESS, ASSETS, OPERATIONS, PROSPECTS OR CONDITION, FINANCIAL OR
OTHERWISE, OF THE BORROWER AND ITS SUBSIDIARIES, TAKEN AS A WHOLE (IT BEING
UNDERSTOOD THAT NEITHER (I) THE BORROWER'S INITIAL PUBLIC OFFERING AND THE
RELATED TRANSACTIONS, INCLUDING THE ACQUISITION OF TXOK, NOR (II) CHANGES IN
COMMODITY PRICES FOR HYDROCARBONS AFFECTING THE OIL AND GAS