Authority for Expenditure. Operator shall issue an Authority for Expenditure (“AFE”) thirty (30) days prior to the month in which it intends to conduct a given operation. Silver Star shall pay to the Operator the amount proscribed on the AFE no later than the close of business on the tenth business day following the delivery of the AFE. Any AFE for existing rentals or new lease acquisition shall contain a twenty percent (20%) management fee for Operator. This section of the Agreement does not apply to any AFE or supplemental AFE issued during the course of actual drilling operations. In that instance the Joint Operating Agreement shall govern as to the timeliness of payment.
Authority for Expenditure. During such next succeeding Calendar Year or calendar quarter, as the case may be, Manager shall have the right and authority with respect to the Approved Operating Budget and Approved Capital Budget (as they may be amended by any Approved Budget Amendments), or an approved Major Decision, or other authorized expenditures expressly set forth under this Agreement, to make expenditures therefore up to 100% of the respective amount provided for such Approved Budget, approved Major Decision, other approved expenditure, cost or liability expressly set forth in this Agreement. To the extent not otherwise covered by an Approved Budget (as amended), an approved Major Decision, and is not otherwise expressly authorized or permitted under another provision of this Agreement, then the Manager may incur (and be reimbursed by the other Owners relative to their share, or demand advance payment of the Owners relative to their share of) any cost, expense or liability which it is not estimated in excess of Fifty Thousand Dollars ($50,000), except in case of Emergencies as hereinafter provided, without the need to be approved by the Committee; and to the extent such cost, expense or liability would be estimated to exceed such amount, then the same shall be incurred by Manager only with the prior written consent of the Committee in the form of an AFE.
Authority for Expenditure. Lakehills and Pantera shall prepare separate budgets for the drilling, re-entry and completion, respectively, of each Well in the Well Program (each, an “Authority for Expenditure” or “AFE”). No fees or other expenses other than the actual, reasonably incurred costs associated with the drilling, re-entry and completion of such Well shall be allocated to any Well and set forth on an AFE. Each AFE shall be subject to the review and approval of Madoff. Lakehills and/or Pantera shall notify Madoff of the dates when drilling and completion will begin. Prior to such dates, Madoff shall pay the applicable amounts set forth in the AFE. Payment of such amounts shall be made by wire transfer of immediately available funds to a bank account designated by Pantera for the exclusive purpose of the Well Program (the “Drilling Program Bank Account”). The Drilling Program Bank Account will be an interest-bearing account maintained separate and apart from all other accounts of Lakehills and Pantera and the funds therein will not be commingled with any of their other funds. Madoff shall be made a signatory on the Drilling Program Bank Account, receive monthly bank statements relating thereto and, to the extent practicable, receive online access thereto. If requested by Madoff, Lakehills shall enter into and it shall cause any of its contractors to enter into a joint check agreement with Madoff pursuant to which Madoff shall have the right to make check(s) payable to both Lakehills and such contractor. Any interest earned on the funds in the account shall be applied to other costs paid out of such account. Notwithstanding anything otherwise set forth herein or in any operating agreement, Madoff shall not be obligated to pre-pay any AFEs or pre-fund the Drilling Program Bank Account. In the event that actual drilling costs exceed the AFE budgets, Madoff shall fund its portion of said overages to the Drilling Program Bank Account in a similar manner promptly after receipt of acceptable documentation evidencing such overages. Pantera and Lakehills shall ensure that none of their officers, directors, managers or employees has a direct or indirect financial interest in any contractor (each a “Well Program Contractor”) working on the Well Program. Pantera and Lakehills shall also ensure that none of their officers, directors, managers or employees directly or indirectly requests or receives from a Well Program Contractor any commissions, gifts or compensation of any type or value above that normally encountered in usual and customary business practices.
Authority for Expenditure. Prior to commencement of operations for the drilling of any Subsequent Prospect Well, the Operator shall prepare and submit to all Prospect working interest owners an AFE for each such well which shall include, but not necessarily be limited to, the estimated costs of drilling, testing, completing, and plugging and abandoning each such Subsequent Prospect Well.
Authority for Expenditure