CAUSE THE BORROWER TO BE IN
COMPLIANCE WITH THE REQUIREMENT TO PROVIDE ACCEPTABLE TITLE INFORMATION ON 75%
OF THE VALUE OF THE OIL AND GAS PROPERTIES.
THIS NEW BORROWING BASE SHALL
BECOME EFFECTIVE IMMEDIATELY AFTER RECEIPT OF SUCH NOTICE.
SECTION 8.14
ADDITIONAL COLLATERAL; ADDITIONAL GUARANTORS.
(A)
IN CONNECTION WITH EACH REDETERMINATION OF THE BORROWING BASE, THE
BORROWER SHALL REVIEW THE RESERVE REPORT AND THE LIST OF CURRENT MORTGAGED
PROPERTIES (AS DESCRIBED IN SECTION 8.12(C)(VI)) TO ASCERTAIN WHETHER THE
MORTGAGED PROPERTIES REPRESENT AT LEAST 75% (UNLESS THE AGGREGATE MAXIMUM CREDIT
AMOUNT IS GREATER THAN $800,000,000 THEN 80%) OF THE TOTAL VALUE OF THE OIL AND
GAS PROPERTIES EVALUATED IN THE MOST RECENTLY COMPLETED RESERVE REPORT AFTER
GIVING EFFECT TO EXPLORATION AND PRODUCTION ACTIVITIES, ACQUISITIONS,
DISPOSITIONS AND PRODUCTION.
IN THE EVENT THAT THE MORTGAGED PROPERTIES DO NOT
REPRESENT AT LEAST 75% (UNLESS THE AGGREGATE MAXIMUM CREDIT AMOUNT IS GREATER
THAN $800,000,000 THEN 80%) OF SUCH TOTAL VALUE, THEN THE BORROWER SHALL, AND
SHALL CAUSE ITS SUBSIDIARIES TO, GRANT, WITHIN THIRTY (30) DAYS OF DELIVERY OF
THE RESERVE REPORT CERTIFICATE, TO THE ADMINISTRATIVE AGENT AS SECURITY FOR THE
INDEBTEDNESS A FIRST-PRIORITY LIEN INTEREST (PROVIDED THAT EXCEPTED LIENS OF THE
TYPE DESCRIBED IN CLAUSES (A) TO (D) AND (F) OF THE DEFINITION THEREOF MAY
EXIST, BUT SUBJECT TO THE PROVISOS AT THE END OF SUCH DEFINITION) ON ADDITIONAL
OIL AND GAS PROPERTIES NOT ALREADY SUBJECT TO A LIEN OF THE SECURITY INSTRUMENTS
SUCH THAT AFTER GIVING EFFECT THERETO, THE MORTGAGED PROPERTIES WILL REPRESENT
AT LEAST 75% (UNLESS THE AGGREGATE MAXIMUM CREDIT AMOUNT IS GREATER THAN
$800,000,000 THEN 80%) OF SUCH TOTAL VALUE.
ALL SUCH LIENS WILL BE CREATED AND
PERFECTED BY AND IN ACCORDANCE WITH THE PROVISIONS OF DEEDS OF TRUST, SECURITY
AGREEMENTS AND FINANCING STATEMENTS OR OTHER SECURITY INSTRUMENTS, 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 OIL AND GAS PROPERTIES AND SUCH SUBSIDIARY
IS NOT A GUARANTOR, THEN IT SHALL BECOME A GUARANTOR AND COMPLY WITH
SECTION 8.14(B).
73
(B)
IN THE EVENT THAT (I) THE BORROWER DETERMINES THAT ANY SUBSIDIARY
IS A MATERIAL DOMESTIC SUBSIDIARY OR (II) ANY DOMESTIC SUBSIDIARY GUARANTEES ANY
OF THE SENIOR NOTES OR INCURS OR GUARANTEES $25,000,000 OR MORE OF DEBT (OTHER
THAN NON-RECOURSE DEBT), THE BORROWER SHALL PROMPTLY CAUSE SUCH SUBSIDIARY TO
GUARANTEE THE INDEBTEDNESS PURSUANT TO THE GUARANTY AGREEMENT.
IN CONNECTION
WITH ANY SUCH GUARANTY, THE BORROWER SHALL, OR SHALL CAUSE SUCH SUBSIDIARY TO,
(A) EXECUTE AND DELIVER A SUPPLEMENT TO THE GUARANTY AGREEMENT EXECUTED BY SUCH
SUBSIDIARY, (B) PLEDGE ALL OF THE EQUITY INTERESTS OF SUCH NEW SUBSIDIARY
(INCLUDING, WITHOUT LIMITATION, DELIVERY OF ORIGINAL STOCK CERTIFICATES
EVIDENCING THE EQUITY INTERESTS OF SUCH SUBSIDIARY, TOGETHER WITH AN APPROPRIATE
UNDATED STOCK POWERS FOR EACH CERTIFICATE DULY EXECUTED IN BLANK BY THE
REGISTERED OWNER THEREOF) OWNED BY THE BORROWER OR SUCH DOMESTIC SUBSIDIARY AND