set forth on Schedule
7.13 to the Interim DIP Credit Agreement.
7.14
Use of Proceeds.
In accordance with the
expenditure line items in the Budget, (a) use the proceeds of the Advances for
any purpose other than (i) to pay transactional fees, costs, and expenses
incurred in connection with this Agreement, the other Loan Documents and the
transactions contemplated hereby and thereby, and (ii) thereafter, consistent
with the terms and conditions hereof, for general corporate purposes, including
the funding of capital expenditures and working capital, provided, however, not
more than $70,000 of proceeds of Advances from and after the Interim Facility
Effective Date may be used for any investigation of prepetition secured claims
and (b) use the proceeds of Letters of Credit for any purpose other than for
general corporate purposes.
7.15
[INTENTIONALLY DELETED]
7.16
Forward Sales.
Except as permitted under
Section 6.22, enter into or permit to exist any advance payment agreement or
other arrangement pursuant to which Borrower or any of its Subsidiaries, having
received full or substantial payment of the purchase price for a specified
quantity of Hydrocarbons upon entering such agreement or arrangement, is
required to deliver, in one or more installments subsequent to the date of such
agreement or arrangement, such quantity of Hydrocarbons pursuant to and during
the terms of such agreement or arrangement.
7.17
Oil and Gas Imbalances.
Enter into any contracts
or agreements which guarantee production of Hydrocarbons (other than Swap
Agreements otherwise permitted under Section 6.22) or hereafter allow gas
imbalances, take-or-pay or other prepayment with respect to its Oil and Gas
Properties which would require Borrower or any of its Subsidiaries to deliver
Hydrocarbons produced on Oil and Gas Properties at some future time without then
or thereafter receiving full payment therefor to exceed, during any monthly
period, two percent (2%) of the current aggregate monthly gas production for
such monthly period from the Oil and Gas Properties of Borrower and its
Subsidiaries.
7.18
MARKETING ACTIVITIES.
(A)
NEITHER BORROWER NOR ANY OF ITS SUBSIDIARIES WILL ENGAGE IN
MARKETING ACTIVITIES FOR ANY HYDROCARBONS OR ENTER INTO ANY CONTRACTS RELATED
THERETO OTHER THAN (I) CONTRACTS FOR THE SALE OF HYDROCARBONS SCHEDULED OR
REASONABLY ESTIMATED TO BE PRODUCED FROM THEIR PROVED OIL AND GAS PROPERTIES
DURING THE PERIOD OF SUCH CONTRACT, (II) CONTRACTS FOR THE SALE OF HYDROCARBONS
SCHEDULED OR REASONABLY ESTIMATED TO BE PRODUCED FROM PROVED OIL AND GAS
PROPERTIES OF THIRD PARTIES
44
DURING THE PERIOD OF SUCH CONTRACT ASSOCIATED WITH THE OIL AND GAS PROPERTIES OF
BORROWER AND ITS SUBSIDIARIES THAT BORROWER (OR ITS SUBSIDIARIES, AS APPLICABLE)
HAS THE RIGHT TO MARKET PURSUANT TO JOINT OPERATING AGREEMENTS, UNITIZATION
AGREEMENTS OR OTHER SIMILAR CONTRACTS THAT ARE USUAL AND CUSTOMARY IN THE OIL
AND GAS BUSINESS AND (III) OTHER CONTRACTS FOR THE PURCHASE AND/OR SALE OF
HYDROCARBONS OF THIRD PARTIES (A) THAT HAVE GENERALLY OFFSETTING PROVISIONS
(I.E., CORRESPONDING PRICING MECHANICS, DELIVERY DATES AND POINTS AND VOLUMES)
SUCH THAT NO "POSITION" IS TAKEN AND (B) FOR WHICH APPROPRIATE CREDIT SUPPORT
HAS BEEN