Common use of Mineral Interests Clause in Contracts

Mineral Interests. All Borrowing Base Properties are valid, subsisting, and in full force and effect in all material respects, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid or provided for in all material respects (except for those amounts being contested by a Credit Party in good faith or held in suspense in accordance with oil industry practice); provided that, to the extent Mineral Interests owned by any such Credit Party are operated by operators other than such Credit Party or an Affiliate of such Credit Party, Borrower has no knowledge that any such obligation remains unperformed in any material respect and the appropriate Person has enforced the contractual obligations of such operators in accordance with reasonable commercial practices in the oil industry in order to ensure performance. Except as may be provided in any consent or non-consent provisions of any joint operating agreement covering any Credit Party’s Proved Mineral Interests, to the extent applicable, each Credit Party’s share of (a) the costs attributable to each Borrowing Base Property is not greater than the decimal fraction set forth in the most recently delivered 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 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.

Mineral Interests. All Each Credit Party has good and defensible title to all of its Mineral Interests described in the Reserve Report, including, without limitation, all Borrowing Base Properties 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 in all material respectseffect, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid or provided for in all material respects (except for those amounts being contested by a Credit Party in good faith or held in suspense in accordance with oil industry practice); provided that, paid. Without regard to the extent Mineral Interests owned by any such Credit Party are operated by operators other than such Credit Party or an Affiliate of such Credit Party, Borrower has no knowledge that any such obligation remains unperformed in any material respect and the appropriate Person has enforced the contractual obligations of such operators in accordance with reasonable commercial practices in the oil industry in order to ensure performance. Except as may be provided in any consent or non-consent provisions of any joint operating agreement covering any of Borrower’s or any other Credit Party’s Proved Mineral Interests, to and with the extent applicableexception of Immaterial Title Deficiencies, each Borrower’s or such Credit Party’s share of (a) the costs attributable to for each Borrowing Base Property Proved Mineral Interest described in the Reserve Report is not greater than the decimal fraction set forth in the most recently delivered 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 Borrowing Base Property 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 NRI,”or similar terms. 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 each Credit Party 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 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.