Common use of Mineral Interests Clause in Contracts

Mineral Interests. Borrower has good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitation, all Borrowing Base Properties, free and clear of all Liens except Permitted Encumbrances and Immaterial Title Deficiencies. With the exception of Immaterial Title Deficiencies, all such Mineral Interests are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s Proved Mineral Interests, and with the exception of Immaterial Title Deficiencies, Borrower’s share of (a) the costs for each Proved Mineral Interest described in the Reserve Report is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “working interests,” “WI,” “gross working interest,” “GWI,” or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “net revenue interest,” “NRI,” or similar terms. In all material respects, each well drilled in respect of each Proved Producing Mineral Interest described in the Reserve Report (y) is capable of, and is presently, producing Hydrocarbons in commercially profitable quantities, and Borrower is currently receiving payments for its share of production, with no funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (z) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.

Mineral Interests. Borrower has good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitationafter giving effect to the Apache Acquisition, all Borrowing Base the Apache Properties, free and clear of all Liens except Permitted Encumbrances and Immaterial Title DeficienciesEncumbrances. With the exception of Immaterial Title Deficiencies, all All such Mineral Interests are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s 's Proved Mineral Interests, and with the exception of Immaterial Title Deficiencies, Borrower’s 's share of (a) the costs for each Proved Mineral Interest described in the Reserve Report is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “"working interests,” “", "WI,” “", "gross working interest,” “GWI,” ", "G.I.", or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “net revenue interest,” “NRI,” , NHI, or similar terms. In all material respects, each Each well drilled in respect of each Proved Producing Mineral Interest described in the Reserve Report (y) is capable of, and is presently, producing Hydrocarbons in commercially profitable quantities, and Borrower is currently receiving payments for its share of production, with no funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (z) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.

Mineral Interests. Borrower has good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitation, all Borrowing Base Properties, free and clear of all Liens except Permitted Encumbrances and Immaterial Title Deficiencies. With the exception of Immaterial Title Deficiencies, all such Mineral Interests are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s 's Proved Mineral Interests, and with the exception of Immaterial Title Deficiencies, Borrower’s 's share of (a) the costs for each Proved Mineral Interest described in the Reserve Report is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “"working interests,” “" "WI,” “" "gross working interest,” “" "GWI,” " or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “"net revenue interest,” “" "NRI,” " or similar terms. In all material respects, each Each well drilled in respect of each Proved Producing Mineral Interest described in the Reserve Report (y) is capable of, and is presently, producing Hydrocarbons in commercially profitable quantities, and Borrower is currently receiving payments for its share of production, with no funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (z) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.

Mineral Interests. Borrower Schedule 3.09 sets forth, as of the date hereof, an accurate and complete list and description of all Real Properties that constitute “Designated Real Properties” pursuant to clause (a) of the definition of such term, and such other Real Properties, if any, as are required to be designated as “Designated Real Properties” in order for the Mortgaged Property Requirement to be satisfied as of the date hereof. Subject only to Immaterial Title Deficiencies and Permitted Encumbrances, each Credit Party has good and defensible title to all Mineral Interests Oil and Gas Properties described in the most recent Reserve ReportReport delivered pursuant hereto (other than any Oil and Gas Properties that have been sold, including, without limitation, all Borrowing Base Properties, free and clear transferred or otherwise disposed of all Liens except Permitted Encumbrances and in accordance with the terms hereof ). Subject only to Immaterial Title Deficiencies. With Deficiencies and Permitted Encumbrances, (a) all Oil and Gas Properties described in the exception of Immaterial Title Deficiencies, all such Mineral Interests most recent Reserve Report delivered pursuant hereto are valid, subsisting, subsisting and in full force and effect, and (b) all material rentals, royalties, royalties and other amounts due and payable in respect thereof have been duly paidpaid when due, except those being contested as provided in good faithSection 5.04(b)(i) with respect to delay rentals. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s Proved Mineral InterestsInterests of any Credit Party, and with the exception of subject to Immaterial Title DeficienciesDeficiencies and Permitted Encumbrances, Borrowersuch Credit Party’s proportionate share of (ai) the costs for each Proved Mineral Interest described in the most recent Reserve Report delivered pursuant hereto is not greater than 105% of the decimal fraction set forth in the such Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “working interests,” ”, “WI,” ”, “gross working interest,” ”, “GWI,” or similar terms, terms (provided that such Credit Party shall have the right to bear costs disproportionate to its working interest with respect to any Mineral Interest for a period of time in order to earn a working interest in such Mineral Interest from a third party as evidenced by a written agreement) and (bii) production from, allocated to, to or attributed to each such Proved Mineral Interest is not less than the decimal fraction set forth in the such Reserve Report, before and after payout, as the case may be, and described therein by the designations “net revenue interest,” ”, “NRI,” or similar terms. In all material respects, each Each well drilled in respect of each Proved Producing Mineral Interest described in the most recent Reserve Report delivered pursuant hereto (yA) is capable of, and is presently, producing Hydrocarbons in commercially profitable quantitiesquantities (except to the extent shut-in in accordance with the applicable lease for such Proved Producing Mineral Interest), and Borrower is currently receiving after giving effect to the transactions contemplated by this Agreement, each Credit Party will be entitled to receive payments on a current basis for its share of production, with no funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (zB) has been drilled, bottomed, completed, completed and operated in compliance in all material compliance respects with all applicable Laws Governmental Rules, and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.

Mineral Interests. Borrower has good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitation, all Borrowing Base Properties, free and clear of all Liens except Permitted Encumbrances and Immaterial Title Deficiencies. With the exception of Immaterial Title Deficiencies, all such Mineral Interests are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s 's Proved Mineral Interests, and with the exception of Immaterial Title Deficiencies, Borrower’s 's share of (a) the costs for each Proved Mineral Interest described in the Reserve Report is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “"working interests,” “" "WI,” “" "gross working interest,” “" "GWI,” " or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “"net revenue interest,” “" "NRI,” " or similar terms. In all material respectsExcept in the case of wells which, in thx xxgregate, represent less than two percent (2%) of the production from the Proved Producing Mineral Interests described in the Reserve Report, each well drilled in respect of each Proved Producing Mineral Interest described in the Reserve Report (y) is capable of, and is presently, producing Hydrocarbons hydrocarbons in commercially profitable quantities, and Borrower is currently receiving payments for its share of production, with no funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (z) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.

Mineral Interests. Borrower has good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitationafter giving effect to the Nebraska Acquisition, all Borrowing Base the Nebraska Properties, free and clear of all Liens except Permitted Encumbrances and Immaterial Title DeficienciesEncumbrances. With the exception of Immaterial Title Deficiencies, all All such Mineral Interests are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s 's Proved Mineral Interests, and with the exception of Immaterial Title Deficiencies, Borrower’s 's share of (a) the costs for each Proved Mineral Interest described in the Reserve Report is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “"working interests,” “", "WI,” “", "gross working interest,” “GWI,” ", "G.I.", or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “net revenue interest,” “NRI,” , NHI, or similar terms. In all material respects, each Each well drilled in respect of each Proved Producing Mineral Interest described in the Reserve Report (y) is capable of, and is presently, producing Hydrocarbons in commercially profitable quantities, and Borrower is currently receiving payments for its share of production, with no funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (z) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.

Mineral Interests. Borrower has good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitationafter giving effect to the Maverick Acquisition, all Borrowing Base the Maverick Properties, free and clear of all Liens except Permitted Encumbrances and Immaterial Title DeficienciesEncumbrances. With the exception of Immaterial Title Deficiencies, all All such Mineral Interests are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s 's Proved Mineral Interests, and with the exception of Immaterial Title Deficiencies, Borrower’s 's share of (a) the costs for each Proved Mineral Interest described in the Reserve Report is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “"working interests,” “", "WI,” “", "gross working interest,” “", "GWI,” ", or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “net revenue interest,” “, NRI,” , or similar terms. In all material respects, each Each well drilled in respect of each Proved Producing Mineral Interest described in the Reserve Report (y) is capable of, and is presently, producing Hydrocarbons in commercially profitable quantities, and Borrower is currently receiving payments for its share of production, with no funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (z) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.

Mineral Interests. The Property Description is an accurate and complete description of all Borrowing Base Properties on the date hereof. Subject only to Immaterial Title Deficiencies (as herein defined), after giving effect to the Capitalization Transactions, Borrower has will have good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitation, all Borrowing Base Properties, free and clear of all Liens except for Permitted Encumbrances and Immaterial Title DeficienciesEncumbrances. With the exception of Immaterial Subject only to immaterial Title Deficiencies, all such Mineral Interests described in the Reserve Report are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s 's Proved Mineral Interests, and with after giving effect to the exception of Capitalization Transactions, but subject to Immaterial Title Deficiencies, Borrower’s 's share of (a) the costs for each Proved Mineral Interest described in the Reserve Report is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “"working interests,” “", "WI,” “", "gross working interest,” “", "GWI,” ", or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “net revenue interest,” “NRI,” or similar terms. In all material respects, each well drilled in respect of each Proved Producing Mineral Interest described in the Reserve Report (y) is capable of, and is presently, producing Hydrocarbons in commercially profitable quantities, and Borrower is currently receiving payments for its share of production, with no funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (z) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.therein

Mineral Interests. Borrower has good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitation, all Borrowing Base Properties, free and clear of all Liens except Permitted Encumbrances and Immaterial Title Deficiencies. With the exception of Immaterial Title Deficiencies, all such Mineral Interests are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s 's Proved Mineral Interests, and with the exception of Immaterial Title Deficiencies, Borrower’s 's share of (a) the costs for each Proved Mineral Interest described in the Reserve Report is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “"working interests,” “" "WI,” “" "gross working interest,” “" "GWI,” " or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “"net revenue interest,” “" "NRI,” " or similar terms. In all material respects, each Each well drilled in respect of each Proved Producing ix xxxxxxx xx xxxx Xxxxxx Xxxxxxxxx Mineral Interest described in the Reserve Report (y) is capable of, and is presently, either producing Hydrocarbons in commercially profitable quantitiesquantities or in the process of being worked over or enhanced, and Borrower is currently receiving payments for its share of any such production, with no funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (z) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws Laws, in each case except where such failure would not have a Material Adverse Effect, and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.

Mineral Interests. Borrower has good and defensible title to ------------------ all Mineral Interests described in the Reserve Report, including, without limitation, all Borrowing Base Properties, free and clear of all Liens except Permitted Encumbrances and Immaterial Title Deficiencies. With the exception of Immaterial Title Deficiencies, all such Mineral Interests are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s 's Proved Mineral Interests, and with the exception of Immaterial Title Deficiencies, Borrower’s 's share of (a) the costs for each Proved Mineral Interest described in the Reserve Report is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “"working interests,” “" "WI,” “" "gross working interest,” “" "GWI,” " or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “"net revenue interest,” “" "NRI,” " or similar terms. In all material respectsExcept in the case of xxxxx which, in the aggregate, represent less than two percent (2%) of the production from the Proved Producing Mineral Interests described in the Reserve Report, each well drilled in respect of each Proved Producing Mineral Interest described in the Reserve Report (y) is capable of, and is presently, producing Hydrocarbons hydrocarbons in commercially profitable quantities, and Borrower is currently receiving payments for its share of production, with no funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (z) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.

Mineral Interests. Borrower Each Credit Party (as applicable) has good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitation, all Borrowing Base Properties, free and clear of all Liens except Permitted Encumbrances and Immaterial Title Deficiencies. With the exception of Immaterial Title Deficiencies, all such Mineral Interests are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrowersuch Credit Party’s Proved Mineral Interests, and with the exception of Immaterial Title Deficiencies, Borrowereach Credit Party’s (as applicable) share of (a) the costs for each Proved Mineral Interest described in the Reserve Report is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “working interests,” “WI,” “gross working interest,” “GWI,” or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “net revenue interest,” “NRI,” or similar terms. In all material respectsExcept in the case of wxxxx which, in the aggregate, represent less than five percent (5%) of the production from the Proved Producing Mineral Interests described in the Reserve Report, each well drilled in respect of each Proved Producing Mineral Interest described in the Reserve Report (yi) is capable of, and is presently, producing Hydrocarbons in commercially profitable quantities, and Borrower each Credit Party (as applicable) is currently receiving payments for its share of production, with no funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (zii) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.

Mineral Interests. Borrower has has, or upon consummation of the Delta/Laramie Transaction will have, good and defensible title to all Mineral Interests described in the most recently delivered Reserve Report, including, without limitation, all Borrowing Base Properties, free and clear of all Liens except Permitted Encumbrances and Immaterial Title Deficiencies. With the exception of Immaterial Title Deficiencies, all such Mineral Interests are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s Proved Mineral Interests, and with the exception of Immaterial Title Deficiencies, Borrower’s share of (a) the costs for each Proved Mineral Interest described in the Reserve Report is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “working interests,” “WI,” “gross working interest,” “GWI,” or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “net revenue interest,” “NRI,” or similar terms. In all material respects, each Each well drilled in respect of each Proved Producing Mineral Interest described in the Reserve Report (yi) is capable of, and is presently, producing Hydrocarbons in commercially profitable quantities, and Borrower is currently receiving payments for its share of production, with no funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (zii) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.

Mineral Interests. Borrower Each Credit Party (as applicable) has good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitation, all Borrowing Base Properties, free and clear of all Liens except Permitted Encumbrances and Immaterial Title Deficiencies. With the exception of Immaterial Title Deficiencies, all such Mineral Interests are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s such Credit Party's Proved Mineral Interests, and with the exception of Immaterial Title Deficiencies, Borrower’s each Credit Party's (as applicable) share of (a) the costs for each Proved Mineral Interest described in the Reserve Report is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “"working interests,” “" "WI,” “" "gross working interest,” “" "GWI,” " or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “"net revenue interest,” “" "NRI,” " or similar terms. In all material respectsExcept in the case of wells which, in the xxxxxgate, represent less than two percent (2%) of the production from the Proved Producing Mineral Interests described in the Reserve Report, each well drilled in respect of each Proved Producing Mineral Interest described in the Reserve Report (y) is capable of, and is presently, producing Hydrocarbons hydrocarbons in commercially profitable quantities, and Borrower each Credit Party (as applicable) is currently receiving payments for its share of production, with no funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (z) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.

Mineral Interests. Borrower has good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitation, all Borrowing Base Properties, free and clear of all Liens except Permitted Encumbrances and Immaterial Title Deficiencies. With the exception of Immaterial Title Deficiencies, all such Mineral Interests are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s Proved Mineral Interests, and with the exception of Immaterial Title Deficiencies, Borrower’s share of (a) the costs for each Proved Mineral Interest described in the Reserve Report is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “working interests,” “WI,” “gross working interest,” “GWI,” or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “net revenue interest,” “NRI,” or similar terms. In all material respects, each Each well drilled in with respect of to each Proved Producing Mineral Interest described in the Reserve Report (y) is capable of, and is presently, producing Hydrocarbons in commercially profitable quantities, and Borrower is currently receiving payments for its share of production, with no funds in with respect of to any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (z) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.

Mineral Interests. Borrower has good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitationExcept for Permitted Borrowing Base Liens, all Borrowing Base Properties, free and clear of all Liens except Permitted Encumbrances and Immaterial Title Deficiencies. With the exception of Immaterial Title Deficiencies, all such Mineral Interests Assets are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering Borrower’s or any of BorrowerGuarantor’s Proved Mineral Interests, and with the exception of Immaterial Title Deficienciesexcept for Permitted Borrowing Base Liens, Borrower’s and each Guarantor’s share of (a) the costs for each Proved Mineral Interest described in the Reserve Report Borrowing Base Asset is not greater than the decimal fraction set forth in the most recently delivered Oil and Gas Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “working interests,” ”, “WI,” ”, “gross working interest,” ”, “GWI,” ”, or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest Borrowing Base Asset is not less than the decimal fraction set forth in the such Oil and Gas Reserve Report, before and after payout, as the case may be, and described therein by the designations “net revenue interest,” “NRI,” or similar terms. In all material respects, each Each well drilled in respect of each Proved Producing Mineral Interest proved producing reserves described in the such Oil and Gas Reserve Report (yi) is capable of, and is presentlywas, as of the date of such Oil & Gas Reserve Report, producing Hydrocarbons in commercially profitable commercial quantities, and Borrower and each Guarantor (as applicable) is currently receiving payments for its share of production, with no funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (zii) to Borrower’s knowledge, has been drilled, bottomed, completed, and operated in compliance in all material compliance respects with all applicable Laws Legal Requirements and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.

Mineral Interests. Borrower has good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitation, all Borrowing Base Properties, free and clear of all Liens except Permitted Encumbrances and Immaterial Title Deficiencies. With the exception of Immaterial Title Deficiencies, all such Mineral Interests are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s 's Proved Mineral Interests, and with the exception of Immaterial Title Deficiencies, Borrower’s 's share of (a) the costs for each Proved Mineral Interest described in the Reserve Report is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “"working interests,” “" "WI,” “" "gross working interest,” “" "GWI,” " or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “"net revenue interest,” “" "NRI,” " or similar terms. In all material respects, each well drilled in respect of each Proved Producing Mineral Interest described in the Reserve Report (y) is capable of, and is presently, producing Hydrocarbons in commercially profitable quantities, and Borrower is currently receiving payments for its share of production, with no funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (z) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.

Mineral Interests. Borrower has good and defensible indefeasible title ----------------- to all Mineral Interests described in the Reserve Report, including, without limitation, all Borrowing Base PropertiesReport other than Immaterial Mineral Interests, free and clear of all Liens except Permitted Encumbrances and Immaterial Title DeficienciesEncumbrances. With the exception of Immaterial Title DeficienciesMineral Interests, all such Mineral Interests are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid. Except with respect to Immaterial Mineral Interests, except those being contested in good faith. Without but without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s 's Proved Mineral Interests, and with the exception of Immaterial Title Deficiencies, Borrower’s 's share of (a) the costs for each Proved Mineral Interest described in the Reserve Report is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “"working interests,” “", "WI,” “", "gross working interest,” “", "GWI,” ", or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “net revenue interest,” “, NRI,” , or similar terms. In all material respectsExcept with respect to Immaterial Mineral Interests, each well drilled in respect of each Proved Producing Mineral Interest described in the Reserve Report (y) is capable of, and is presently, producing Hydrocarbons hydrocarbons in commercially profitable quantities, and Borrower is currently receiving payments for its share of production, with no funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (z) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws and no such well which is currently producing Hydrocarbons hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production. For purposes of this Section 7.9, "Immaterial Mineral Interests" ----------- means Mineral Interests which, in the aggregate, do not represent more than five percent (5%) of the discounted present value of all Mineral Interests as set forth in the Reserve Report.

Mineral Interests. Borrower has Borrowers have good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitation, all Borrowing Base Properties, free and clear of all Liens except Permitted Encumbrances and Immaterial Title Deficiencies. With the exception of Immaterial Title Deficiencies, all such Mineral Interests are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s Borrowers’ Proved Mineral Interests, and with the exception of Immaterial Title Deficiencies, Borrower’s Borrowers’ share of (a) the costs for each Proved Mineral Interest described in the Reserve Report is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “working interests,” “WI,” “gross working interest,” “GWI,” or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “net revenue interest,” “NRI,” or similar terms. In all material respects, each Each well drilled in with respect of to each Proved Producing Mineral Interest described in the Reserve Report (yi) is capable of, and is presently, producing Hydrocarbons in commercially profitable quantities, and Borrower is Borrowers are currently receiving payments for its their share of production, with no funds in with respect of to any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (zii) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.

Mineral Interests. Borrower has (a) Upon consummation of the Closing Transactions, Borrowers will have good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitation, all Borrowing Base PropertiesProperties (except for Borrowing Base Properties disposed of in compliance with, and to the extent permitted by, Section 10.5 to the extent this representation and warranty is made or deemed made after the Closing Date), free and clear of all Liens Liens, except Permitted Encumbrances and Immaterial Title Deficiencies. With , and will have full authority to create Liens thereon in favor of Administrative Agent for the ratable benefit of Banks, (b) with the exception of Immaterial Title Deficiencies, all such Mineral Interests Borrowing Base Properties are valid, subsisting, and in full force and effect, and all rentals, royalties, royalties and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without (c) without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s Proved such Mineral Interests, Interests and with the exception of Immaterial Title Deficiencies, Borrower’s upon consummation of the Closing Transactions, Borrowers' share of (ai) the costs for each Proved Mineral Interest described in the Reserve Report Borrowing Base Property is not greater than the decimal fraction set forth in the Reserve ReportReports, before and after payout, as the case may be, and described therein by the respective designations “"working interests,” “" "WI,” “" "gross working interest,” “" "GWI,” " or similar terms, and (bii) production from, allocated to, or attributed to each such Proved Mineral Interest Borrowing Base Property is not less than the decimal fraction set forth in the such Reserve Report, before and after payout, as the case may be, and described therein by the designations “"net revenue interest,” “" "NRI,” " or similar terms. In all material respects, and (d) except in the case of wellx xxxch, in the aggregate, represent less than four percent (4%) of the production of the Proved Producing Mineral Interests described in the Reserve Reports, each well drilled in respect of each Proved Producing Mineral Interest described in the Reserve Report (yA) is capable of, and is presently, producing Hydrocarbons in commercially 62 profitable quantities, and Borrower is currently receiving upon consummation of the Closing Transactions, Borrowers will receive payments for its their share of production, with and no funds in respect of any thereof being presently will be held in suspense, suspense other than any such funds being held in suspense pending delivery of appropriate division orders, and (zB) to Parent's and each Borrower's knowledge, has been drilled, bottomed, completed, completed and operated in material compliance with all applicable Laws and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.

Mineral Interests. Borrower Each Credit Party has good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitation, all of its Borrowing Base Properties, free and clear of all Liens except Permitted Encumbrances and Immaterial Title Deficiencies. With the exception of Subject only to Immaterial Title DeficienciesDeficiencies and Permitted Encumbrances, all such Mineral Interests Borrowing Base Properties are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s Proved Mineral InterestsInterests of any Credit Party, and with the exception of but subject to Immaterial Title DeficienciesDeficiencies and Permitted Encumbrances, Borrower’s each Credit Party's share of (a) the costs for each Proved Mineral Interest described in the Reserve Report of its Borrowing Base Properties is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “"working interests,” “" "WI,” “" "gross working interest,” “" "GWI,” " or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest of its Borrowing Base Properties is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “"net revenue interest,” “" "NRI,” " or similar terms. In all material respects, each Each well drilled in respect of each Proved Producing Mineral Interest Borrowing Base Property which is categorized as proved developed producing reserves and described in the Reserve Report (yi) is capable of, and, with the exception of wells which are presently not producing Hydrocarbons pending the compxxxxxn of workovers and repairs to such wells, is presently, producing Hydrocarbons in commercially profitable quantitiesprofitablx xxxntities, and Borrower each Credit Party is currently receiving payments for its share of production, with and no material amount of funds in respect of any thereof being presently are held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (zii) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws in all material respects and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production. The breach of any representation or warranty set forth in Section 5.08 (as it relates to Borrowing Base Properties) or this Section 5.09 shall not automatically cause an Event of Default under Section 8.01(e) hereof. Instead, upon becoming aware that any Credit Party has breached, or caused the breach of, any representation or warranty set forth in Section 5.08 (as it relates to Borrowing Base Properties) or this Section 5.09, Required Lenders may cause to be made a Special Redetermination of the Borrowing Base according to Section 2.13(c) hereof, in which case that portion of the Borrowing Base Properties as to which the representations and warranties of Section 5.08 (as it relates to Borrowing Base Properties) or this Section 5.09 have been breached shall be excluded from the Mineral Interests evaluated for purposes of the Borrowing Base; provided, however, an Event of Default shall occur if, upon redetermination of the Borrowing Base, the Borrowing Base as so redetermined has been reduced by more than twenty-five percent (25%) from the Borrowing Base in effect immediately prior to such Redetermination or the Borrower fails to pay in full when due any mandatory prepayment required by Section 2.04 hereof as a result of such Borrowing Base Deficiency.

Mineral Interests. Borrower has good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitationafter giving effect to the Chevron Acquisition, all Borrowing Base the Chevron Properties (excluding any Rejected Chevron Properties), free and clear of all Liens except Permitted Encumbrances and Immaterial Title Deficiencies. With the exception of Immaterial Title Deficiencies, all such Mineral Interests are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s 's Proved Mineral Interests, and with the exception of Immaterial Title Deficiencies, Borrower’s 's share of (a) the costs for each Proved Mineral Interest described in the Reserve Report is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “"working interests,” “", "WI,” “", "gross working interest,” “", "GWI,” ", or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral CREDIT AGREEMENT PAGE 35 42 Interest is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “net revenue interest,” “, NRI,” , or similar terms. In all material respectsExcept in the case of wellx xxxch, in the aggregate, represent less than two percent (2%) of the production from the Proved Producing Mineral Interests described in the Reserve Report, each well drilled in respect of each Proved Producing Mineral Interest described in the Reserve Report (y) is capable of, and is presently, producing Hydrocarbons hydrocarbons in commercially profitable quantities, and Borrower is currently receiving payments for its share of production, with no funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (z) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws and no such well which is currently producing Hydrocarbons hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.

Mineral Interests. Upon completion of the Shell Acquisition, Borrower has will have good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitation, all Borrowing Base Properties, free and clear of all Liens except Permitted Encumbrances and Immaterial Title Deficiencies. With the exception of Subject only to Immaterial Title DeficienciesDeficiencies and Permitted Encumbrances, all such Mineral Interests Borrowing Base Properties are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s 's Proved Mineral Interests, and with upon completion of the exception of Shell Acquisition, but subject to Immaterial Title DeficienciesDeficiencies and Permitted Encumbrances, Borrower’s 's share of (a) the costs for each Proved Mineral Interest described in the Reserve Report Borrowing Base Property is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “"working interests,” “" "WI,” “" "gross working interest,” “" "GWI,” " or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest Borrowing Base Property is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “"net revenue interest,” “" "NRI,” " or similar terms. In all material respects, each Each well drilled in respect of each Proved Producing Mineral Interest Borrowing Base Property which is categorized as proved developed producing reserves and described in the Reserve Report (y) is capable of, and is presentlyand, with the exception of wellx xxxch are presently not producing Hydrocarbons in commercially profitable quantities, and Borrower is currently receiving payments for its share pending the completion of production, with no funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (z) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.workovers and

Mineral Interests. Borrower has good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitationafter giving effect to the Central Resources Acquisition, all Borrowing Base the Central Resources Properties, free and clear of all Liens except Permitted Encumbrances and Immaterial Title DeficienciesEncumbrances. With the exception of Immaterial Title Deficiencies, all All such Mineral Interests are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s 's Proved Mineral Interests, and with the exception of Immaterial Title Deficiencies, Borrower’s 's share of (a) the costs for each Proved Mineral Interest described in the Reserve Report is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “"working interests,” “", "WI,” “", "gross working interest,” “", "GWI,” ", or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “net revenue interest,” “, NRI,” , or similar terms. In all material respects, each Each well drilled in respect of each Proved Producing Mineral Interest described in the Reserve Report (y) is capable of, and is presently, producing Hydrocarbons in commercially profitable quantities, and Borrower is currently receiving payments for its share of production, with no funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (z) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.

Mineral Interests. Borrower Each Credit Party (as applicable) has good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitation, all Borrowing Base Properties, free and clear of all Liens except Permitted Encumbrances and Immaterial Title Deficiencies. With the exception of Immaterial Title Deficiencies, all such Mineral Interests are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s such Credit Party's Proved Mineral Interests, and with the exception of Immaterial Title Deficiencies, Borrower’s each Credit Party's (as applicable) share of (a) the costs for each Proved Mineral Interest described in the Reserve Report is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “"working interests,” “" "WI,” “" "gross working interest,” “" "GWI,” " or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “"net revenue interest,” “" "NRI,” " or similar terms. In all material respectsExcept in the case of wells which, in the aggregate, rxxxxxent less than two percent (2%) of the production from the Proved Producing Mineral Interests described in the Reserve Report, each well drilled in respect of each Proved Producing Mineral Interest described in the Reserve Report (y) is capable of, and is presently, producing Hydrocarbons hydrocarbons in commercially profitable quantities, and Borrower each Credit Party (as applicable) is currently receiving payments for its share of production, with no funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (z) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.

Mineral Interests. Borrower Operating has good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitation, all Borrowing Base Properties, free and clear of all Liens except Permitted Encumbrances and Immaterial Title Deficiencies. With the exception of Subject only to Immaterial Title DeficienciesDeficiencies and Permitted Encumbrances, all such Mineral Interests Borrowing Base Properties are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s Operating's Proved Mineral Interests, and with the exception of but subject to Immaterial Title DeficienciesDeficiencies and Permitted Encumbrances, Borrower’s Operating's share of (a) the costs for each Proved Mineral Interest described in the Reserve Report Borrowing Base Property is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “"working interests,” “" "WI,” “" "gross working interest,” “" "GWI,” " or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest Borrowing Base Property is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “"net revenue interest,” “" "NRI,” " or similar terms. In all material respects, each Each well drilled in respect of each Proved Producing Mineral Interest Borrowing Base Property which is categorized as proved developed producing reserves and described in the Reserve Report (yi) is capable of, and, with the exception of xxxxx which are presently not producing Hydrocarbons pending the completion of workovers and repairs to such xxxxx, is presently, producing Hydrocarbons in commercially profitable quantities, and Borrower Operating is currently receiving payments for its share of production, with and no material amount of funds in respect of any thereof being presently are held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (zii) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws in all material respects and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production. Operating's breach of any representation or warranty set forth in this Section 8.9 shall not automatically cause an Event of Default under Section 12.1(e) hereof. Instead, upon becoming aware that Operating has breached any representation or warranty set forth in this Section 8.9, Required Banks may cause to be made a Special Redetermination of the Borrowing Base according to Section 5.3(a) hereof, in which case that portion of the Borrowing Base Properties as to which the representations and warranties of this Section 8.9 have been breached shall be excluded from the Mineral Interests evaluated for purposes of the Borrowing Base; provided, however, an Event of Default shall occur if, upon redetermination of the Borrowing Base, the Borrowing Base as so redetermined has been reduced by more than twenty-five percent (25%) from the Borrowing Base in effect immediately prior to such Redetermination or Operating fails to pay in full when due any mandatory prepayment required by Section 2.4 hereof as a result of such Borrowing Base Deficiency.

Mineral Interests. Borrower has good and defensible title to all Mineral Interests described in the Reserve Report, including, without limitation, all Borrowing Base Properties, free and clear of all Liens except Permitted Encumbrances and Immaterial Title Deficiencies. With the exception of Immaterial Title Deficiencies, all such Mineral Interests are valid, subsisting, and in full force and effect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid, except those being contested in good faith. Without regard to any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s Proved Mineral Interests, and with the exception of Immaterial Title Deficiencies, Borrower’s share of (a) the costs for each Proved Mineral Interest described in the Reserve Report is not greater than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “working interests,” “WI,” “gross working interest,” “GWI,” or similar terms, and (b) production from, allocated to, or attributed to each such Proved Mineral Interest is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “net revenue interest,” “NRI,” or similar terms. In all material respects, each well drilled in respect of each Proved Producing Mineral Interest described in the Reserve Report (y) is capable of, and is presently, producing Hydrocarbons in commercially profitable paying quantities, and Borrower is currently receiving payments for its share of production, with no funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (z) has been drilled, bottomed, completed, and operated in material compliance with all applicable Laws and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production.