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
DURING THE PERIOD OF SUCH CONTRACT ASSOCIATED WITH THE OIL AND GAS PROPERTIES OF
THE BORROWER AND ITS SUBSIDIARIES THAT THE BORROWER OR ONE OF ITS SUBSIDIARIES
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) WHICH 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 TAKEN TO ALLEVIATE THE MATERIAL CREDIT RISKS OF THE COUNTERPARTY
THERETO.
ARTICLE IX
NEGATIVE COVENANTS
Until the Commitments have expired or terminated and the principal of and
interest on each Loan and all fees payable hereunder and all other amounts
payable under the Loan Documents (other than contingent indemnification
obligations) have been paid in full and all Letters of Credit have expired or
terminated and all LC Disbursements shall have been reimbursed, the Borrower
covenants and agrees with the Lenders that:
SECTION 9.01
FINANCIAL COVENANTS.
(A)
RATIO OF TOTAL DEBT TO EBITDA.
THE BORROWER WILL NOT, AT ANY
TIME, PERMIT ITS RATIO OF TOTAL DEBT AS OF SUCH TIME TO EBITDA FOR THE FOUR
FISCAL QUARTERS ENDING ON THE LAST DAY OF THE FISCAL QUARTER IMMEDIATELY
PRECEDING THE DATE OF DETERMINATION FOR WHICH FINANCIAL STATEMENTS ARE AVAILABLE
TO BE GREATER THAN 3.5 TO 1.0.
(B)
CURRENT RATIO.
THE BORROWER WILL NOT PERMIT, AS OF THE LAST DAY
OF ANY FISCAL QUARTER, ITS RATIO OF (I) CONSOLIDATED CURRENT ASSETS (INCLUDING
THE UNUSED AMOUNT OF THE TOTAL COMMITMENTS, BUT EXCLUDING NON-CASH ASSETS UNDER
FAS 133) TO (II) CONSOLIDATED CURRENT LIABILITIES (EXCLUDING NON-CASH
OBLIGATIONS UNDER FAS 133 AND CURRENT MATURITIES UNDER THIS AGREEMENT) TO BE
LESS THAN 1.0 TO 1.0.
SECTION 9.02
DEBT.
THE BORROWER WILL NOT, AND WILL NOT PERMIT ANY
SUBSIDIARY TO, INCUR, CREATE, ASSUME OR SUFFER TO EXIST ANY DEBT, EXCEPT:
(A)
THE NOTES OR OTHER INDEBTEDNESS ARISING UNDER THE LOAN DOCUMENTS
OR ANY GUARANTY OF OR SURETYSHIP ARRANGEMENT FOR THE NOTES OR OTHER INDEBTEDNESS
ARISING UNDER THE LOAN DOCUMENTS.
(B)
DEBT OF THE BORROWER AND ITS SUBSIDIARIES EXISTING ON THE DATE
HEREOF THAT IS REFLECTED IN THE FINANCIAL STATEMENTS, INCLUDING THE EXISTING
SENIOR NOTES, AND ANY PERMITTED REFINANCING DEBT IN RESPECT THEREOF.
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(C)
ACCOUNTS PAYABLE AND ACCRUED EXPENSES, LIABILITIES OR OTHER
OBLIGATIONS TO PAY THE DEFERRED PURCHASE PRICE OF PROPERTY OR SERVICES, FROM
TIME TO TIME INCURRED IN THE ORDINARY COURSE OF BUSINESS WHICH ARE NOT GREATER
THAN NINETY (90) DAYS PAST THE DATE OF INVOICE OR DELINQUENT OR WHICH ARE BEING
CONTESTED IN GOOD FAITH BY APPROPRIATE ACTION