OTHER ACTION (INCLUDING, WITHOUT LIMITATION, AUTHORIZING THE FILING OF SUCH UCC
FINANCING STATEMENTS AND DELIVERING CERTIFICATES IN RESPECT OF THE CAPITAL STOCK
OF SUCH RESTRICTED SUBSIDIARY) AS SHALL BE NECESSARY OR APPROPRIATE TO
ESTABLISH, CREATE, PRESERVE, PROTECT AND PERFECT A FIRST PRIORITY LIEN (SUBJECT
ONLY TO PERMITTED LIENS) IN FAVOR
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OF ADMINISTRATIVE AGENT FOR THE BENEFIT OF ADMINISTRATIVE AGENT AND LENDERS TO
THE EXTENT REQUIRED BY SECTION 4.10(E), (II) TO EXECUTE SUCH OTHER SECURITY
DOCUMENTS, IN FORM AND SUBSTANCE REASONABLY ACCEPTABLE TO ADMINISTRATIVE AGENT,
AS MAY BE REQUIRED OR REQUESTED BY ADMINISTRATIVE AGENT IN CONNECTION WITH THE
ACTIONS CONTEMPLATED HEREBY AND (III) TO DELIVER SUCH PROOF OF CORPORATE (OR
COMPARABLE) ACTION, INCUMBENCY OF OFFICERS, OPINIONS OF COUNSEL AND OTHER
DOCUMENTS AS ADMINISTRATIVE AGENT SHALL HAVE REASONABLY REQUIRED OR REQUESTED.
UNTIL SUCH TIME THAT ANY RESTRICTED SUBSIDIARY SHALL HAVE FULLY COMPLIED WITH
THE PROVISIONS OF THIS PARAGRAPH, AND WITHOUT LIMITATION OF ANY RIGHTS AND
REMEDIES AVAILABLE TO ADMINISTRATIVE AGENT AND LENDERS AS A RESULT THEREOF, THE
OPERATING RESULTS OF SUCH RESTRICTED SUBSIDIARY SHALL BE DISREGARDED IN THE
CALCULATION OF EBITDAX FOR ANY MEASUREMENT PERIOD.
(C)
CAPITAL STOCK. BORROWER WILL, AND WILL CAUSE EACH OF ITS
RESTRICTED SUBSIDIARIES, TO TAKE SUCH ACTION FROM TIME TO TIME AS SHALL BE
NECESSARY TO ENSURE THAT EACH OF ITS RESTRICTED SUBSIDIARIES IS A WHOLLY-OWNED
SUBSIDIARY AND THAT ADMINISTRATIVE AGENT SHALL HAVE, FOR THE BENEFIT OF
ADMINISTRATIVE AGENT AND LENDERS, A FIRST PRIORITY LIEN ON ALL CAPITAL STOCK OF
EACH RESTRICTED SUBSIDIARY, PROVIDED THAT NEITHER BORROWER NOR ANY FOREIGN
SUBSIDIARY SHALL BE REQUIRED TO PLEDGE MORE THAN 65% OF THE CAPITAL STOCK OF ANY
SUCH FOREIGN SUBSIDIARY TO THE EXTENT SUCH GRANT AND/OR PLEDGE WOULD RESULT IN
MATERIAL ADVERSE TAX CONSEQUENCES TO BORROWER UNDER SECTION 956 OF THE INTERNAL
REVENUE CODE AS DETERMINED BY ADMINISTRATIVE AGENT). IN THE EVENT THAT ANY
ADDITIONAL CAPITAL STOCK SHALL BE ISSUED BY ANY RESTRICTED SUBSIDIARY, BORROWER
SHALL OR SHALL CAUSE EACH OF ITS RESTRICTED SUBSIDIARIES TO, PROMPTLY FOLLOWING
SUCH ISSUANCE, DELIVER TO ADMINISTRATIVE AGENT TO THE EXTENT REQUIRED BY THE
APPLICABLE FINANCING DOCUMENTS THE CERTIFICATES EVIDENCING SUCH CAPITAL STOCK,
ACCOMPANIED BY UNDATED POWERS EXECUTED IN BLANK AND TO TAKE SUCH OTHER ACTION AS
ADMINISTRATIVE AGENT SHALL REQUEST TO PERFECT THE SECURITY INTEREST CREATED
THEREIN PURSUANT TO SUCH FINANCING DOCUMENTS.
(D)
MORTGAGE OF OIL AND GAS PROPERTY. PRIOR TO EACH DETERMINATION
DATE, BORROWER SHALL REVIEW THE RESERVE REPORT AND THE LIST OF CURRENT MORTGAGED
PROPERTIES TO ASCERTAIN WHETHER THE MORTGAGED PROPERTIES REPRESENT AT LEAST 80%
OF THE TOTAL PV-10 VALUE OF PROVED RESERVES ATTRIBUTABLE TO THE OIL AND GAS
PROPERTIES EVALUATED IN THE MOST RECENTLY COMPLETED RESERVE REPORT AFTER GIVING
EFFECT TO ANY EXPLORATION AND PRODUCTION ACTIVITIES, ACQUISITIONS, DISPOSITIONS
AND PRODUCTION. IN THE EVENT THAT THE MORTGAGED PROPERTIES DO NOT REPRESENT AT
LEAST 80% OF SUCH TOTAL PV-10 VALUE, THEN ON OR PRIOR TO SUCH DETERMINATION
DATE, BORROWER SHALL, AND SHALL CAUSE ITS RESTRICTED SUBSIDIARIES TO, GRANT TO
ADMINISTRATIVE AGENT AS SECURITY FOR THE DEBT A FIRST-PRIORITY LIEN (SUBJECT