Common use of Hedge Transactions Clause in Contracts

Hedge Transactions. (a) The Borrower will not, and will not permit any of its Restricted Subsidiaries to, enter into any commodity Hedge Transaction except that the Borrower or other Credit Party shall be permitted to enter into, as of any date, commodity Hedge Transactions with an Approved Counterparty related to bona fide (and not speculative) hedging activities of the Borrower or other Credit Party with respect to which the aggregate notional volumes covered thereby do not exceed, subject to clause (b) below, when aggregated and netted with all other commodity Hedge Transactions (other than “put” options) of the Borrower and the other Credit Parties then in effect, (i) for any month during the first 24 months after the date of execution of such Hedge Transaction (the “First Measurement Period”), 100% and (ii) for any month during the first 36 months immediately following the First Measurement Period, 75%, in each case, of the Borrower’s and the other Credit Parties’ reasonably anticipated projected production (assuming no curtailment or interruption of transportation for such anticipated production) of (A) crude oil (for crude oil related Hedge Transactions) and (B) natural gas (for natural gas related Hedge Transactions), in each case, for such month, from the Borrower’s and the other Credit Parties’ Oil and Gas Properties constituting proved developed producing reserves. (b) It is understood that commodity Hedge Transactions that may, from time to time, “hedge” the same volumes, but different elements of commodity risk thereof (e.g., commodity price risk versus basis risk), shall not be aggregated together when calculating the foregoing limitations on notional volumes. (c) Notwithstanding anything to the contrary in this Section 9.18, there shall be no prohibition under this Agreement or any other Loan Paper against the Borrower or any other Credit Party entering into purchased “put” options not otherwise prohibited hereunder, in each case, so long as such agreements are entered into with an Approved Counterparty in the ordinary course of business for the purpose of hedging against fluctuations of commodity prices. (d) Neither the Borrower nor any Restricted Subsidiary will enter into any Hedge Transaction for the purpose of speculation (whether with respect to the levels of commodity prices in the future or otherwise). (e) In no event shall any Swap Agreement contain any requirement, agreement or covenant for the Borrower or any Restricted Subsidiary to post collateral, credit support (including a letter of credit) or margin to secure their obligations under such Swap Agreement or to cover market exposures; provided that this sentence shall not (i) prevent a Lender Swap Provider from requiring the obligations under its Swap Agreement with any Credit Party to be secured by the Liens granted to the Administrative Agent under the Security Instruments, or (ii) prohibit any Credit Party from being party to any Swap Agreement with an Approved Counterparty that contains a requirement, agreement or covenant for any Person other than a Credit Party to post collateral, credit support (including a letter of credit) or margin to secure such Credit Party’s obligations under such Swap Agreement or to cover market exposures. (f) Neither the Borrower nor any of its Restricted Subsidiaries shall enter into any Hedge Transaction with a term longer than 60 months from the date such transaction is entered into. (g) If, after the end of any calendar month, the Borrower determines that the aggregate volume of all commodity Hedge Transactions for which settlement payments were calculated in such calendar month exceeded 100% of actual production of crude oil and natural gas, calculated separately, in such calendar month, then the Borrower shall, or shall cause one or more other Credit Parties to, within twenty (20) Business Days of such determinations terminate, create off-setting positions, allocate volumes to other production for which the Borrower and the other Credit Parties are marketing, or otherwise unwind existing commodity Hedge Transactions such that, at such time, future hedging volumes will not exceed 100% of reasonably anticipated projected production for the then-current and any succeeding calendar months. (h) The Borrower will not, and will not permit any of its Restricted Subsidiaries to, enter into any Hedge Transactions in respect of interest rates with an Approved Counterparty, except as follows: (i) Hedge Transactions effectively converting interest rates from fixed to floating, the notional amounts of which (when aggregated with all other Hedge Transactions of the Borrower and the other Credit Parties then in effect effectively converting interest rates from fixed to floating) do not exceed 100% of the then outstanding principal amount of the Credit Parties’ Obligations for borrowed money that bears interest at a fixed rate and (ii) Hedge Transactions effectively converting interest rates from floating to fixed, the notional amounts of which (when aggregated with all other Hedge Transactions of the Borrower and the other Credit Parties then in effect effectively converting interest rates from floating to fixed) do not exceed 100% of the then outstanding principal amount of the Credit Parties’ Obligations for borrowed money that bears interest at a floating rate. For purposes of this Section 9.18, forecasts of projected production shall equal the projections for proved developed producing reserves of each crude oil and natural gas set out in the most recent Reserve Report delivered to the Administrative Agent as revised in good faith to account for any increase or reductions therein anticipated based on information obtained by the Borrower subsequent to the publication of the such Reserve Report, including the Borrower’s internal forecasts of production decline rates for existing w▇▇▇▇ and additions to or deletions from anticipated future production from new w▇▇▇▇ and acquisitions coming on stream or failing to come on stream and Dispositions of Oil and Gas Properties, each as reflected in a separate or supplemental Reserve Report delivered to the Administrative Agent and otherwise satisfactory to the Administrative Agent.

Hedge Transactions. (a) The Borrower will not, and will not permit any of its Restricted Subsidiaries Subsidiary to, enter into any commodity Hedge Transaction except that Transactions with any Person other than: (a) Hedge Transactions in respect of commodities entered into not for speculative purposes the Borrower or net notional volumes for which (when aggregated with other Credit Party shall be permitted to enter into, as of any date, commodity Hedge Transactions with an Approved Counterparty related then in effect, other than puts, floors and basis differential swaps on volumes already hedged pursuant to bona fide (and not speculativeother Hedge Transactions) hedging activities of the Borrower or other Credit Party with respect to which the aggregate notional volumes covered thereby do not exceed, subject as of the date the latest Hedging Transaction is entered into, 90% of the reasonably anticipated quarterly production of oil, natural gas and natural gas liquids, calculated separately, from the Credit Parties’ total Proved Developed Producing Reserves and 50% of the reasonably anticipated quarterly production of oil, natural gas and natural gas liquids, calculated separately, from the Credit Parties’ total Proved Developed Non-Producing Reserves; provided, that, with respect to clause (b) below, when aggregated and netted with all other commodity Hedge Transactions (other than “put” options) for commodities the net notional volumes for which are in respect of reasonably anticipated production during any of the months of August through October of any year, in no event shall the Borrower or any Restricted Subsidiary enter into Hedge Transactions with respect to more than 65% of reasonably anticipated production of oil, natural gas and natural gas liquids, calculated separately, from the other Credit Parties’ total Proved Developed Producing Reserves for any of such months (and in no event shall the Borrower or any Restricted Subsidiary enter into Hedge Transactions with respect to any of the reasonably anticipated quarterly production of oil, natural gas and natural gas liquids, calculated separately, from the Credit Parties’ total Proved Developed Non-Producing Reserves for any of such months), (provided further that, with respect to the amount of such reduction of permitted Hedge Transactions in respect of the months of August through October of any year, such amount may be used to increase amounts otherwise permitted during the remaining portion of each year), in each case, as forecast based upon the Initial Reserve Report or the most recent Reserve Report delivered pursuant to Section 9.14(a), as applicable for the forty-eight (48) month period from the date of creation of such hedging arrangement (the “Ongoing ▇▇▇▇▇▇”). In addition to the Ongoing ▇▇▇▇▇▇, in connection with a proposed Permitted Acquisition (a “Proposed Acquisition”), the Credit Parties then may also enter into incremental Hedge Transactions with respect to the Credit Parties’ reasonably anticipated production of oil, natural gas and natural gas liquids, calculated separately, from the Credit Parties’ total Proved Reserves as forecast based upon the most recent Reserve Report having notional volumes not in effectexcess of 90% of the Credit Parties’ existing projected production prior to the consummation of such Proposed Acquisition (provided that the aggregate of all Hedge Transactions in respect of commodities shall not, in any event, exceed 90% of the reasonably anticipated projected production of oil, natural gas and natural gas liquids, calculated separately, from the Credit Parties Proved Developed Producing Reserves after giving effect to the consummation of such Proposed Acquisition) for a period not exceeding 36 months from the date such hedging arrangement is created during the period between (i) for any month during the first 24 months date on which such Credit Party signs a definitive acquisition agreement in connection with a Proposed Acquisition and (ii) the earliest of (A) the date of consummation of such Proposed Acquisition, (B) the date of termination of such Proposed Acquisition and (C) 120 days after the date of execution of such Hedge Transaction definitive acquisition agreement (or such longer period as to which the “First Measurement Period”Administrative Agent may agree). However, 100% all such incremental hedging contracts entered into with respect to a Proposed Acquisition must be terminated or unwound not later than the earlier of (i) if the Proposed Acquisition has not yet been consummated, 120 days (or such longer period to the extent approved in writing by the Administrative Agent) following the date on which such Credit Party executed such definitive acquisition agreement and (ii) for any month during the first 36 months immediately 30 days following the First Measurement Period, 75%date such Proposed Acquisition is terminated, in each case, to the extent the aggregate notional volumes hedged in anticipation of such Proposed Acquisition exceed the Borrower’s and the other Credit Parties’ reasonably anticipated projected production (assuming no curtailment or interruption of transportation volumes permitted for such anticipated production) of (A) crude oil (for crude oil related Hedge Transactions) and (B) natural gas (for natural gas related Hedge Transactions), in each case, for such month, from the Borrower’s and the other Credit Parties’ Oil and Gas Properties constituting proved developed producing reserves. (b) Ongoing ▇▇▇▇▇▇. It is understood that commodity Hedge Transactions that which may, from time to time, “hedge” the same volumes, but different elements of commodity risk thereof (e.g., commodity price risk versus basis risk)thereof, shall not be aggregated together when calculating the foregoing limitations on notional volumes. (b) Other Hedge Transactions (other than any Hedge Transactions in respect of equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions) entered into not for speculative purposes. (c) Notwithstanding anything to the contrary in It is understood that for purposes of this Section 9.1810.10, there the following Hedge Transactions shall not be deemed speculative or entered into for speculative purposes: (i) any commodity Hedge Transaction intended, at inception of execution, to hedge or manage any of the risks related to existing and/or reasonably anticipated projected Hydrocarbon production from reserves of the Borrower or its Restricted Subsidiaries (whether or not contracted) and (ii) any Hedge Transaction intended, at inception of execution, (A) to hedge or manage the interest rate exposure associated with any debt securities, debt facilities or leases (existing or reasonably anticipated) of the Borrower or its Restricted Subsidiaries, (B) to manage commodity portfolio exposure associated with changes in interest rates, (C) to hedge any exposure that the Borrower or its Restricted Subsidiaries may have to counterparties under other Hedge Transactions such that the combination of such Hedge Transactions is not speculative taken as a whole or (D) for foreign exchange or currency exchange management. (d) For purposes of entering into or maintaining Ongoing ▇▇▇▇▇▇ under Section 10.10(a), reasonably anticipated projected Hydrocarbon production from the Credit Parties’ total Proved Reserves based upon the Initial Reserve Report or the most recent Reserve Report delivered pursuant to Section 9.14(a), as applicable, shall be no prohibition under this Agreement revised to account for any increase or any other Loan Paper against the decrease therein anticipated because of information obtained by Borrower or any other Credit Party entering into purchased “put” options not otherwise prohibited hereunder, in each case, so long as such agreements are entered into with an Approved Counterparty in the ordinary course of business for the purpose of hedging against fluctuations of commodity prices. (d) Neither the Borrower nor any Restricted Subsidiary will enter into any Hedge Transaction for the purpose of speculation (whether with respect to the levels of commodity prices in the future or otherwise). (e) In no event shall any Swap Agreement contain any requirement, agreement or covenant for the Borrower or any Restricted Subsidiary to post collateral, credit support (including a letter of credit) or margin to secure their obligations under such Swap Agreement or to cover market exposures; provided that this sentence shall not (i) prevent a Lender Swap Provider from requiring the obligations under its Swap Agreement with any Credit Party to be secured by the Liens granted to the Administrative Agent under the Security Instruments, or (ii) prohibit any Credit Party from being party to any Swap Agreement with an Approved Counterparty that contains a requirement, agreement or covenant for any Person other than a Credit Party to post collateral, credit support (including a letter of credit) or margin to secure such Credit Party’s obligations under such Swap Agreement or to cover market exposures. (f) Neither the Borrower nor any of its Restricted Subsidiaries shall enter into any Hedge Transaction with a term longer than 60 months from the date such transaction is entered into. (g) If, after the end of any calendar month, the Borrower determines that the aggregate volume of all commodity Hedge Transactions for which settlement payments were calculated in such calendar month exceeded 100% of actual production of crude oil and natural gas, calculated separately, in such calendar month, then the Borrower shall, or shall cause one or more other Credit Parties to, within twenty (20) Business Days of such determinations terminate, create off-setting positions, allocate volumes to other production for which the Borrower and the other Credit Parties are marketing, or otherwise unwind existing commodity Hedge Transactions such that, at such time, future hedging volumes will not exceed 100% of reasonably anticipated projected production for the then-current and any succeeding calendar months. (h) The Borrower will not, and will not permit any of its Restricted Subsidiaries to, enter into any Hedge Transactions in respect of interest rates with an Approved Counterparty, except as follows: (i) Hedge Transactions effectively converting interest rates from fixed to floating, the notional amounts of which (when aggregated with all other Hedge Transactions of the Borrower and the other Credit Parties then in effect effectively converting interest rates from fixed to floating) do not exceed 100% of the then outstanding principal amount of the Credit Parties’ Obligations for borrowed money that bears interest at a fixed rate and (ii) Hedge Transactions effectively converting interest rates from floating to fixed, the notional amounts of which (when aggregated with all other Hedge Transactions of the Borrower and the other Credit Parties then in effect effectively converting interest rates from floating to fixed) do not exceed 100% of the then outstanding principal amount of the Credit Parties’ Obligations for borrowed money that bears interest at a floating rate. For purposes of this Section 9.18, forecasts of projected production shall equal the projections for proved developed producing reserves of each crude oil and natural gas set out in the most recent Reserve Report delivered to the Administrative Agent as revised in good faith to account for any increase or reductions therein anticipated based on information obtained by the Borrower subsequent to the publication of the such Reserve Report, Report including the Borrower’s or any other Credit Party’s internal forecasts of production decline rates for existing w▇▇▇▇▇ and additions to or deletions from anticipated future production from new w▇▇▇▇▇ and acquisitions coming on stream or failing to come on stream and Dispositions of Oil and Gas Properties, each as reflected in a separate or supplemental Reserve Report delivered to the Administrative Agent and otherwise satisfactory to the Administrative Agentstream.

Hedge Transactions. (a) The Borrower will not, and will not permit any of its Restricted Subsidiaries to, enter into any commodity Hedge Transaction except that the Borrower or other Credit Loan Party shall be permitted to enter into, as of any date, commodity date Hedge Transactions with an Approved Counterparty related to bona fide (and not speculative) hedging activities of the Borrower or other Credit Loan Party with respect to which the aggregate notional volumes covered thereby do not exceed, subject to clause (b) below, when aggregated and netted with all other commodity Hedge Transactions (other than “put” options) of the Borrower and the other Credit Loan Parties then in effect, (i) for any month during the first 24 months period from the then-current date until four (4) years after the date of execution of such Hedge Transaction (the “First Measurement Period”)then-current date, 10085% and (ii) for any month during the first 36 months immediately following the First Measurement Period, 75%, in each case, of the Borrower’s and the other Credit Loan Parties’ reasonably anticipated projected production (assuming no curtailment or interruption of transportation for such anticipated production) of (A) crude oil (for crude oil related Hedge Transactions) ), and (B) 85% of the Borrower’s and the other Loan Parties’ reasonably anticipated projected production of natural gas (for natural gas related Hedge Transactions), in each case, for such month, from the Borrower’s and the other Credit Loan Parties’ Oil and Gas Properties constituting proved developed producing reserves. (b) It is understood that commodity Hedge Transactions Transaction that may, from time to time, “hedge” the same volumes, but different elements of commodity risk thereof (e.g., commodity price risk versus basis risk), shall not be aggregated together when calculating the foregoing limitations on notional volumes. (c) Notwithstanding anything to the contrary in this Section 9.186.18, there shall be no prohibition under this Agreement or any other Loan Paper Document against the Borrower or any other Credit Loan Party entering into purchased “put” options not otherwise prohibited hereunder, in each case, so long as such agreements are entered into with an Approved Counterparty in the ordinary course of business for the purpose of hedging against fluctuations of commodity prices. (d) Neither the Borrower nor any Restricted Subsidiary will enter into any Hedge Transaction for the purpose of speculation (whether with respect to the levels of commodity prices in the future or otherwise)future. (e) In no event shall any Swap Hedge Agreement contain any requirement, agreement or covenant for the Borrower or any Restricted Subsidiary to post collateral, credit support (including a letter of credit) or margin to secure their obligations under such Swap Hedge Agreement or to cover market exposures; , provided that this sentence shall not (i) prevent a Lender Swap Provider an Approved Counterparty from requiring the obligations under its Swap Hedge Agreement with any Credit Loan Party to be secured by the Liens granted to the Administrative Agent under the Security InstrumentsDocuments, or (ii) prohibit any Credit Loan Party from being party to any Swap Hedge Agreement with an Approved Counterparty that contains a requirement, agreement or covenant for any Person other than a Credit Loan Party to post collateral, credit support (including a letter of credit) or margin to secure such Credit Loan Party’s obligations under such Swap Hedge Agreement or to cover market exposures. (f) Neither the Borrower nor any of its Restricted Subsidiaries shall enter into any Hedge Transaction with a term longer than 60 48 months from the date such transaction is entered into. (g) If, after the end of any calendar month, the Borrower determines that the aggregate volume of all commodity Hedge Transactions for which settlement payments were calculated in such calendar month exceeded 100% of actual production of crude oil and natural gas, calculated separately, in such calendar month, then the Borrower shall, or shall cause one or more other Credit Loan Parties to, within twenty five (205) Business Days of such determinations terminate, create off-setting positions, allocate volumes to other production for which the Borrower and the other Credit Loan Parties are marketing, or otherwise unwind existing commodity Hedge Transactions such that, at such time, future hedging volumes will not exceed 100% of reasonably anticipated projected production for the then-current and any succeeding calendar months. (h) The Borrower will not, and will not permit any of its Restricted Subsidiaries to, enter into any Hedge Transactions in respect of interest rates with an Approved Counterparty, except as follows: (i) Hedge Transactions effectively converting interest rates from fixed to floating, the notional amounts of which (when aggregated with all other Hedge Transactions of the Borrower and the other Credit Parties then in effect effectively converting interest rates from fixed to floating) do not exceed 100% of the then outstanding principal amount of the Credit Parties’ Obligations for borrowed money that bears interest at a fixed rate and (ii) Hedge Transactions effectively converting interest rates from floating to fixed, the notional amounts of which (when aggregated with all other Hedge Transactions of the Borrower and the other Credit Parties then in effect effectively converting interest rates from floating to fixed) do not exceed 100% of the then outstanding principal amount of the Credit Parties’ Obligations for borrowed money that bears interest at a floating rate. For purposes of this Section 9.186.18, forecasts of projected production shall equal the projections for proved developed producing reserves of each crude oil and natural gas set out in the most recent Reserve Report delivered to the Administrative Agent as revised in good faith to account for any increase or reductions therein anticipated based on information obtained by the Borrower subsequent to the publication of the such Reserve Report, including the Borrower’s internal forecasts of production decline rates for existing w▇▇▇▇▇ and additions to or deletions from anticipated future production from new w▇▇▇▇▇ and acquisitions coming on stream or failing to come on stream and Dispositions of Oil and Gas Properties, each as reflected in a separate or supplemental Reserve Report delivered to the Administrative Agent and otherwise satisfactory to the Administrative Agent.

Hedge Transactions. (a) The Borrower will not, and nor will not Borrower permit any of its Restricted Subsidiaries other Credit Party to, enter into any commodity Hedge Transaction except that the Borrower or other Credit Party shall be permitted to enter into, as of any date, commodity Hedge Transactions with an Approved Counterparty related to bona fide (and not speculative) hedging activities of the Borrower or other Credit Party with respect to which the aggregate notional volumes covered thereby do not exceedor, subject to clause (bB) belowof the proviso in the first sentence of Section 9.5, when aggregated permit to exist any Oil and netted with all other commodity Gas Hedge Transactions (other than “put” options(x) of purchased put options or price floors with respect to Hydrocarbons and (y) Oil and Gas Hedge Transactions Liquidated, or to be Liquidated, pursuant to the Borrower and the other Credit Parties then in effect, Legacy Asset Disposition Agreement) (i) with a duration longer than five years from the date the applicable Oil and Gas Hedge Transaction is entered into or (ii) whereby the volume of Hydrocarbons with respect to which a settlement payment is calculated would exceed (A) for any month during the first 24 months after the date of execution of such Hedge Transaction (the “First Measurement Period”), 100% and (iiB) for any month during the first 36 months immediately following the First Measurement Period, 75%, in each case, (x) of the Borrower’s and the other Credit Parties’ reasonably anticipated projected production (assuming no curtailment or interruption of transportation for such anticipated production) of (A) crude oil (for crude oil related Hedge Transactions) from Proved Mineral Interests and (By) natural gas (for natural gas related Hedge Transactions)without duplication of the “put” and “call”, in each casenotional quantities of any collars. Borrower will not, for such month, from the Borrower’s and the other Credit Parties’ Oil and Gas Properties constituting proved developed producing reserves. (b) It is understood that commodity Hedge Transactions that may, from time to time, “hedge” the same volumes, but different elements of commodity risk thereof (e.g., commodity price risk versus basis risk), shall not be aggregated together when calculating the foregoing limitations on notional volumes. (c) Notwithstanding anything to the contrary in this Section 9.18, there shall be no prohibition under this Agreement or any other Loan Paper against the nor will Borrower or permit any other Credit Party entering to, enter into purchased “put” options not otherwise prohibited hereunderany commodity, in each caseinterest rate, so long as such agreements are entered into with an Approved Counterparty in currency or other swap, option, collar or other derivative transaction pursuant to which any Credit Party speculates on the ordinary course of business for the purpose of hedging against fluctuations movement of commodity prices. (d) Neither the Borrower nor any Restricted Subsidiary will enter into any Hedge Transaction for the purpose of speculation (whether with respect to the levels of commodity prices in the future , securities prices, interest rates, financial markets, currency markets or otherwise). (e) In no event shall any Swap Agreement contain any requirement, agreement or covenant for the Borrower or any Restricted Subsidiary to post collateral, credit support (including a letter of credit) or margin to secure their obligations under such Swap Agreement or to cover market exposuresother items; provided that that, nothing contained in this sentence Section 9.10(a) shall not (i) prevent a Lender Swap Provider from requiring the obligations under its Swap Agreement with any Credit Party to be secured by the Liens granted to the Administrative Agent under the Security Instruments, or (ii) prohibit any Credit Party from being party (1) entering into interest rate swaps or other interest rate hedge transactions pursuant to any Swap Agreement with an Approved Counterparty that contains a requirement, agreement or covenant for any Person other than a which such Credit Party h▇▇▇▇▇ interest rate risk with respect to post collateralthe interest reasonably anticipated to be incurred pursuant to this Agreement, credit support (including a letter of credit2) entering into Oil and Gas Hedge Transactions otherwise permitted by this Section 9.10(a) or margin to secure such Credit Party’s Section 9.10(b), or (3) making Permitted Investments or (4) entering into the Renewable Product Purchase Documents and performing its obligations under such Swap Agreement or to cover market exposures.thereunder; (fb) Neither the Borrower nor any of its Restricted Subsidiaries shall enter into any Hedge Transaction with a term longer than 60 months from the date such transaction is entered into. (g) If, after the end of any calendar month, the Borrower determines that the aggregate volume of all commodity Hedge Transactions for which settlement payments were calculated in such calendar month exceeded 100% of actual production of crude oil and natural gas, calculated separately, in such calendar month, then the Borrower shall, or shall cause one or more other Credit Parties to, within twenty (20) Business Days of such determinations terminate, create off-setting positions, allocate volumes to other production for which the Borrower and the other Credit Parties are marketing, or otherwise unwind existing commodity may enter into Hedge Transactions Agreements that would be permitted by Section 9.10(a) pertaining to Mineral Interests to be acquired pursuant to a Specified Acquisition; provided that Hedge Agreements pursuant to this Section 9.10(b) must be Liquidated upon the earlier to occur of: (i) the date that is 90 days after the execution of the purchase and sale agreement relating to the Specified Acquisition to the extent that such that, at Specified Acquisition has not been consummated by such time, future hedging volumes date and (ii) any Credit Party knows with reasonable certainty that the Specified Acquisition will not exceed 100% of reasonably anticipated projected production for the then-current and any succeeding calendar months.be consummated; and (hc) The Borrower will not, and will not permit any of its Restricted Subsidiaries other Credit Party to, enter into Liquidate any Hedge Transactions Agreement (other than Hedge Agreements Liquidated, or to be Liquidated, pursuant to the Legacy Asset Disposition Agreement) in respect of interest rates with commodities unless (x) if such Swap Liquidation would result in an Approved Counterparty, except as follows: (i) Hedge Transactions effectively converting interest rates from fixed to floating, the notional amounts of which (when aggregated with all other Hedge Transactions automatic redetermination of the Borrowing Base pursuant to Section 4.6, Borrower and the other Credit Parties then in effect effectively converting interest rates from fixed to floating) do not exceed 100% of the then outstanding principal amount of the Credit Parties’ Obligations for borrowed money that bears interest at a fixed rate and (ii) Hedge Transactions effectively converting interest rates from floating to fixed, the notional amounts of which (when aggregated with all other Hedge Transactions of the Borrower and the other Credit Parties then in effect effectively converting interest rates from floating to fixed) do not exceed 100% of the then outstanding principal amount of the Credit Parties’ Obligations for borrowed money that bears interest at a floating rate. For purposes of this Section 9.18, forecasts of projected production shall equal the projections for proved developed producing reserves of each crude oil and natural gas set out in the most recent Reserve Report delivered to the Administrative Agent as revised in good faith to account for any increase or reductions therein anticipated based on information obtained by the Borrower subsequent to the publication of the such Reserve Report, including the Borrower’s internal forecasts of production decline rates for existing w▇▇▇▇ and additions to or deletions from anticipated future production from new w▇▇▇▇ and acquisitions coming on stream or failing to come on stream and Dispositions of Oil and Gas Properties, each as reflected in a separate or supplemental Reserve Report delivered to the Administrative Agent and otherwise satisfactory delivers reasonable prior written notice thereof to the Administrative Agent, and (y) if a Borrowing Base Deficiency would result from such Swap Liquidation as a result of an automatic redetermination of the Borrowing Base pursuant to Section 4.6, Borrower prepays Borrowings, prior to or contemporaneously with the consummation of such Swap Liquidation to the extent that such prepayment would have been required under Section 2.6(a) after giving effect to such automatic redetermination of the Borrowing Base.

Hedge Transactions. (a) The Borrower will not, and nor will not Borrower permit any of its Restricted Subsidiaries other Credit Party to, enter into any commodity Hedge Transaction except that the Borrower or other Credit Party shall be permitted to enter into, as of any date, commodity Hedge Transactions with an Approved Counterparty related to bona fide (and not speculative) hedging activities of the Borrower or other Credit Party with respect to which the aggregate notional volumes covered thereby do not exceedor, subject to clause (bB) belowof the proviso in the first sentence of Section 9.5, when aggregated permit to exist any Oil and netted with all other commodity Gas Hedge Transactions (other than “put” options(x) of purchased put options or price floors with respect to Hydrocarbons and (y) Oil and Gas Hedge Transactions Liquidated, or to be Liquidated, pursuant to the Borrower and the other Credit Parties then in effect, Legacy Asset Disposition Agreement) (i) with a duration longer than five years from the date the applicable Oil and Gas Hedge Transaction is entered into or (ii) whereby the volume of Hydrocarbons with respect to which a settlement payment is calculated would exceed (A) for any month during the first 24 months after the date of execution of such Hedge Transaction (the “First Measurement Period”), 100% and (iiB) for any month during the first 36 months immediately following the First Measurement Period, 75%, in each case, (x) of the Borrower’s and the other Credit Parties’ reasonably anticipated projected production (assuming no curtailment or interruption of transportation for such anticipated production) of (A) crude oil (for crude oil related Hedge Transactions) from Proved Mineral Interests and (By) natural gas (for natural gas related Hedge Transactions)without duplication of the “put” and “call”, in each casenotional quantities of any collars. Borrower will not, for such month, from the Borrower’s and the other Credit Parties’ Oil and Gas Properties constituting proved developed producing reserves. (b) It is understood that commodity Hedge Transactions that may, from time to time, “hedge” the same volumes, but different elements of commodity risk thereof (e.g., commodity price risk versus basis risk), shall not be aggregated together when calculating the foregoing limitations on notional volumes. (c) Notwithstanding anything to the contrary in this Section 9.18, there shall be no prohibition under this Agreement or any other Loan Paper against the nor will Borrower or permit any other Credit Party entering to, enter into purchased “put” options not otherwise prohibited hereunderany commodity, in each caseinterest rate, so long as such agreements are entered into with an Approved Counterparty in currency or other swap, option, collar or other derivative transaction pursuant to which any Credit Party speculates on the ordinary course of business for the purpose of hedging against fluctuations movement of commodity prices. (d) Neither the Borrower nor any Restricted Subsidiary will enter into any Hedge Transaction for the purpose of speculation (whether with respect to the levels of commodity prices in the future , securities prices, interest rates, financial markets, currency markets or otherwise). (e) In no event shall any Swap Agreement contain any requirement, agreement or covenant for the Borrower or any Restricted Subsidiary to post collateral, credit support (including a letter of credit) or margin to secure their obligations under such Swap Agreement or to cover market exposuresother items; provided that that, nothing contained in this sentence Section 9.10(a) shall not (i) prevent a Lender Swap Provider from requiring the obligations under its Swap Agreement with any Credit Party to be secured by the Liens granted to the Administrative Agent under the Security Instruments, or (ii) prohibit any Credit Party from being party (1) entering into interest rate swaps or other interest rate hedge transactions pursuant to any Swap Agreement with an Approved Counterparty that contains a requirement, agreement or covenant for any Person other than a which such Credit Party h▇▇▇▇▇ interest rate risk with respect to post collateralthe interest reasonably anticipated to be incurred pursuant to this Agreement, credit support (including a letter of credit2) entering into Oil and Gas Hedge Transactions otherwise permitted by this Section 9.10(a) or margin to secure such Credit Party’s obligations under such Swap Agreement Section 9.10(b), or to cover market exposures.(3) making Permitted Investments; (fb) Neither the Borrower nor any of its Restricted Subsidiaries shall enter into any Hedge Transaction with a term longer than 60 months from the date such transaction is entered into. (g) If, after the end of any calendar month, the Borrower determines that the aggregate volume of all commodity Hedge Transactions for which settlement payments were calculated in such calendar month exceeded 100% of actual production of crude oil and natural gas, calculated separately, in such calendar month, then the Borrower shall, or shall cause one or more other Credit Parties to, within twenty (20) Business Days of such determinations terminate, create off-setting positions, allocate volumes to other production for which the Borrower and the other Credit Parties are marketing, or otherwise unwind existing commodity may enter into Hedge Transactions Agreements that would be permitted by Section 9.10(a) pertaining to Mineral Interests to be acquired pursuant to a Specified Acquisition; provided that Hedge Agreements pursuant to this Section 9.10(b) must be Liquidated upon the earlier to occur of: (i) the date that is 90 days after the execution of the purchase and sale agreement relating to the Specified Acquisition to the extent that such that, at Specified Acquisition has not been consummated by such time, future hedging volumes date and (ii) any Credit Party knows with reasonable certainty that the Specified Acquisition will not exceed 100% of reasonably anticipated projected production for the then-current and any succeeding calendar months.be consummated; and (hc) The Borrower will not, and will not permit any of its Restricted Subsidiaries other Credit Party to, enter into Liquidate any Hedge Transactions Agreement (other than Hedge Agreements Liquidated, or to be Liquidated, pursuant to the Legacy Asset Disposition Agreement) in respect of interest rates with commodities unless (x) if such Swap Liquidation would result in an Approved Counterparty, except as follows: (i) Hedge Transactions effectively converting interest rates from fixed to floating, the notional amounts of which (when aggregated with all other Hedge Transactions automatic redetermination of the Borrowing Base pursuant to Section 4.6, Borrower and the other Credit Parties then in effect effectively converting interest rates from fixed to floating) do not exceed 100% of the then outstanding principal amount of the Credit Parties’ Obligations for borrowed money that bears interest at a fixed rate and (ii) Hedge Transactions effectively converting interest rates from floating to fixed, the notional amounts of which (when aggregated with all other Hedge Transactions of the Borrower and the other Credit Parties then in effect effectively converting interest rates from floating to fixed) do not exceed 100% of the then outstanding principal amount of the Credit Parties’ Obligations for borrowed money that bears interest at a floating rate. For purposes of this Section 9.18, forecasts of projected production shall equal the projections for proved developed producing reserves of each crude oil and natural gas set out in the most recent Reserve Report delivered to the Administrative Agent as revised in good faith to account for any increase or reductions therein anticipated based on information obtained by the Borrower subsequent to the publication of the such Reserve Report, including the Borrower’s internal forecasts of production decline rates for existing w▇▇▇▇ and additions to or deletions from anticipated future production from new w▇▇▇▇ and acquisitions coming on stream or failing to come on stream and Dispositions of Oil and Gas Properties, each as reflected in a separate or supplemental Reserve Report delivered to the Administrative Agent and otherwise satisfactory delivers reasonable prior written notice thereof to the Administrative Agent, and (y) if a Borrowing Base Deficiency would result from such Swap Liquidation as a result of an automatic redetermination of the Borrowing Base pursuant to Section 4.6, Borrower prepays Borrowings, prior to or contemporaneously with the consummation of such Swap Liquidation to the extent that such prepayment would have been required under Section 2.6(a) after giving effect to such automatic redetermination of the Borrowing Base.

Hedge Transactions. (a) The Borrower will not, and nor will not Borrower permit any of its Restricted Subsidiaries other Credit Party to, enter into any commodity Hedge Transaction except that the Borrower or other Credit Party shall be permitted to enter into, as of any date, commodity Hedge Transactions with an Approved Counterparty related to bona fide (and not speculative) hedging activities of the Borrower or other Credit Party with respect to which the aggregate notional volumes covered thereby do not exceedor, subject to clause (bB) belowof the proviso in the first sentence of Section 9.5, when aggregated permit to exist any Oil and netted with all other commodity Gas Hedge Transactions (other than “put” options(x) of purchased put options or price floors with respect to Hydrocarbons and (y) Oil and Gas Hedge Transactions Liquidated, or to be Liquidated, pursuant to the Borrower and the other Credit Parties then in effect, Legacy Asset Disposition Agreement) (i) with a duration longer than five years from the date the applicable Oil and Gas Hedge Transaction is entered into or (ii) whereby the volume of Hydrocarbons with respect to which a settlement payment is calculated would exceed (A) for any month during the first 24 months after the date of execution of such Hedge Transaction (the “First Measurement Period”), 100% and (iiB) for any month during the first 36 months immediately following the First Measurement Period, 75%, in each case, (x) of the Borrower’s and the other Credit Parties’ reasonably anticipated projected production (assuming no curtailment or interruption of transportation for such anticipated production) of (A) crude oil (for crude oil related Hedge Transactions) from Proved Mineral Interests and (By) natural gas (for natural gas related Hedge Transactions)without duplication of the “put” and “call”, in each casenotional quantities of any collars. Borrower will not, for such month, from the Borrower’s and the other Credit Parties’ Oil and Gas Properties constituting proved developed producing reserves. (b) It is understood that commodity Hedge Transactions that may, from time to time, “hedge” the same volumes, but different elements of commodity risk thereof (e.g., commodity price risk versus basis risk), shall not be aggregated together when calculating the foregoing limitations on notional volumes. (c) Notwithstanding anything to the contrary in this Section 9.18, there shall be no prohibition under this Agreement or any other Loan Paper against the nor will Borrower or permit any other Credit Party entering to, enter into purchased “put” options not otherwise prohibited hereunderany commodity, in each caseinterest rate, so long as such agreements are entered into with an Approved Counterparty in currency or other swap, option, collar or other derivative transaction pursuant to which any Credit Party speculates on the ordinary course of business for the purpose of hedging against fluctuations movement of commodity prices. (d) Neither the Borrower nor any Restricted Subsidiary will enter into any Hedge Transaction for the purpose of speculation (whether with respect to the levels of commodity prices in the future , securities prices, interest rates, financial markets, currency markets or otherwise). (e) In no event shall any Swap Agreement contain any requirement, agreement or covenant for the Borrower or any Restricted Subsidiary to post collateral, credit support (including a letter of credit) or margin to secure their obligations under such Swap Agreement or to cover market exposuresother items; provided that that, nothing contained in this sentence Section 9.10(a) shall not (i) prevent a Lender Swap Provider from requiring the obligations under its Swap Agreement with any Credit Party to be secured by the Liens granted to the Administrative Agent under the Security Instruments, or (ii) prohibit any Credit Party from being party (1) entering into interest rate swaps or other interest rate hedge transactions pursuant to any Swap Agreement with an Approved Counterparty that contains a requirement, agreement or covenant for any Person other than a which such Credit Party ▇▇▇▇▇▇ interest rate risk with respect to post collateralthe interest reasonably anticipated to be incurred pursuant to this Agreement, credit support (including a letter of credit2) entering into Oil and Gas Hedge Transactions otherwise permitted by this Section 9.10(a) or margin to secure such Credit Party’s Section 9.10(b), (3) making Permitted Investments or (4) entering into the Renewable Product Purchase Documents and performing its obligations under such Swap Agreement or to cover market exposures.thereunder; (fb) Neither the Borrower nor any of its Restricted Subsidiaries shall enter into any Hedge Transaction with a term longer than 60 months from the date such transaction is entered into. (g) If, after the end of any calendar month, the Borrower determines that the aggregate volume of all commodity Hedge Transactions for which settlement payments were calculated in such calendar month exceeded 100% of actual production of crude oil and natural gas, calculated separately, in such calendar month, then the Borrower shall, or shall cause one or more other Credit Parties to, within twenty (20) Business Days of such determinations terminate, create off-setting positions, allocate volumes to other production for which the Borrower and the other Credit Parties are marketing, or otherwise unwind existing commodity may enter into Hedge Transactions Agreements that would be permitted by Section 9.10(a) pertaining to Mineral Interests to be acquired pursuant to a Specified Acquisition; provided that Hedge Agreements pursuant to this Section 9.10(b) must be Liquidated upon the earlier to occur of: (i) the date that is 90 days after the execution of the purchase and sale agreement relating to the Specified Acquisition to the extent that such that, at Specified Acquisition has not been consummated by such time, future hedging volumes date and (ii) any Credit Party knows with reasonable certainty that the Specified Acquisition will not exceed 100% of reasonably anticipated projected production for the then-current and any succeeding calendar months.be consummated; and (hc) The Borrower will not, and will not permit any of its Restricted Subsidiaries other Credit Party to, enter into Liquidate any Hedge Transactions Agreement (other than Hedge Agreements Liquidated, or to be Liquidated, pursuant to the Legacy Asset Disposition Agreement) in respect of interest rates with commodities unless (x) if such Swap Liquidation would result in an Approved Counterparty, except as follows: (i) Hedge Transactions effectively converting interest rates from fixed to floating, the notional amounts of which (when aggregated with all other Hedge Transactions automatic redetermination of the Borrowing Base pursuant to Section 4.6, Borrower and the other Credit Parties then in effect effectively converting interest rates from fixed to floating) do not exceed 100% of the then outstanding principal amount of the Credit Parties’ Obligations for borrowed money that bears interest at a fixed rate and (ii) Hedge Transactions effectively converting interest rates from floating to fixed, the notional amounts of which (when aggregated with all other Hedge Transactions of the Borrower and the other Credit Parties then in effect effectively converting interest rates from floating to fixed) do not exceed 100% of the then outstanding principal amount of the Credit Parties’ Obligations for borrowed money that bears interest at a floating rate. For purposes of this Section 9.18, forecasts of projected production shall equal the projections for proved developed producing reserves of each crude oil and natural gas set out in the most recent Reserve Report delivered to the Administrative Agent as revised in good faith to account for any increase or reductions therein anticipated based on information obtained by the Borrower subsequent to the publication of the such Reserve Report, including the Borrower’s internal forecasts of production decline rates for existing w▇▇▇▇ and additions to or deletions from anticipated future production from new w▇▇▇▇ and acquisitions coming on stream or failing to come on stream and Dispositions of Oil and Gas Properties, each as reflected in a separate or supplemental Reserve Report delivered to the Administrative Agent and otherwise satisfactory delivers reasonable prior written notice thereof to the Administrative Agent, and (y) if a Borrowing Base Deficiency would result from such Swap Liquidation as a result of an automatic redetermination of the Borrowing Base pursuant to Section 4.6, Borrower prepays Borrowings, prior to or contemporaneously with the consummation of such Swap Liquidation to the extent that such prepayment would have been required under Section 2.6(a) after giving effect to such automatic redetermination of the Borrowing Base.

Hedge Transactions. (a) The Borrower will not, and nor will not Borrower permit any of its Restricted Subsidiaries other Credit Party to, enter into any commodity Hedge Transaction except that the Borrower or other Credit Party shall be permitted to enter into, as of any date, commodity Hedge Transactions with an Approved Counterparty related to bona fide (and not speculative) hedging activities of the Borrower or other Credit Party with respect to which the aggregate notional volumes covered thereby do not exceedor, subject to clause (bB) belowof the proviso in the first sentence of Section 9.5, when aggregated permit to exist any Oil and netted with all other commodity Gas Hedge Transactions (other than “put” optionspurchased put options or price floors with respect to Hydrocarbons) (a) with a duration longer than five years from the date the applicable Oil and Gas Hedge Transaction is entered into or (b) whereby the volume of the Borrower and the other Credit Parties then in effect, Hydrocarbons with respect to which a settlement payment is calculated would exceed (i) for any month during the first 24 months after the date of execution of such Hedge Transaction (the “First Measurement Period”), 100% and (ii) for any month during the first 36 months immediately following the First Measurement Period, 75%, in each case, (x) of the Borrower’s and the other Credit Parties’ reasonably anticipated projected production (assuming no curtailment or interruption of transportation for such anticipated production) of (A) crude oil (for crude oil related Hedge Transactions) from Proved Mineral Interests and (By) natural gas (for natural gas related Hedge Transactions)without duplication of the “put” and “call”, in each casenotional quantities of any collars. Borrower will not, for such month, from the Borrower’s and the other Credit Parties’ Oil and Gas Properties constituting proved developed producing reserves. (b) It is understood that commodity Hedge Transactions that may, from time to time, “hedge” the same volumes, but different elements of commodity risk thereof (e.g., commodity price risk versus basis risk), shall not be aggregated together when calculating the foregoing limitations on notional volumes. (c) Notwithstanding anything to the contrary in this Section 9.18, there shall be no prohibition under this Agreement or any other Loan Paper against the nor will Borrower or permit any other Credit Party entering to, enter into purchased “put” options not otherwise prohibited hereunderany commodity, in each caseinterest rate, so long as such agreements are entered into with an Approved Counterparty in currency or other swap, option, collar or other derivative transaction pursuant to which any Credit Party speculates on the ordinary course of business for the purpose of hedging against fluctuations movement of commodity prices. (d) Neither the Borrower nor any Restricted Subsidiary will enter into any Hedge Transaction for the purpose of speculation (whether with respect to the levels of commodity prices in the future , securities prices, interest rates, financial markets, currency markets or otherwise). (e) In no event shall any Swap Agreement contain any requirement, agreement or covenant for the Borrower or any Restricted Subsidiary to post collateral, credit support (including a letter of credit) or margin to secure their obligations under such Swap Agreement or to cover market exposuresother items; provided that that, nothing contained in this sentence Section 9.10(a) shall not (i) prevent a Lender Swap Provider from requiring the obligations under its Swap Agreement with any Credit Party to be secured by the Liens granted to the Administrative Agent under the Security Instruments, or (ii) prohibit any Credit Party from being party (a) entering into interest rate swaps or other interest rate hedge transactions pursuant to any Swap Agreement with an Approved Counterparty that contains a requirement, agreement or covenant for any Person other than a which such Credit Party ▇▇▇▇▇▇ interest rate risk with respect to post collateralthe interest reasonably anticipated to be incurred pursuant to this Agreement, credit support (including a letter of creditb) entering into Oil and Gas Hedge Transactions otherwise permitted by this Section 9.10(a), or margin to secure such Credit Party’s obligations under such Swap Agreement or to cover market exposures.(c) making Permitted Investments; (fb) Neither the Borrower nor any of its Restricted Subsidiaries shall enter into any Hedge Transaction with a term longer than 60 months from the date such transaction is entered into. (g) If, after the end of any calendar month, the Borrower determines that the aggregate volume of all commodity Hedge Transactions for which settlement payments were calculated in such calendar month exceeded 100% of actual production of crude oil and natural gas, calculated separately, in such calendar month, then the Borrower shall, or shall cause one or more other Credit Parties to, within twenty (20) Business Days of such determinations terminate, create off-setting positions, allocate volumes to other production for which the Borrower and the other Credit Parties are marketing, or otherwise unwind existing commodity may enter into Hedge Transactions Agreements that would be permitted by Section 9.10(a) pertaining to Mineral Interests to be acquired pursuant to a Specified Acquisition; provided that Hedge Agreements pursuant to this Section 9.10(b) must be Liquidated upon the earlier to occur of: (A) the date that is 90 days after the execution of the purchase and sale agreement relating to the Specified Acquisition to the extent that such that, at Specified Acquisition has not been consummated by such time, future hedging volumes date and (B) any Credit Party knows with reasonable certainty that the Specified Acquisition will not exceed 100% of reasonably anticipated projected production for the then-current and any succeeding calendar months.be consummated; and (hc) The Borrower will not, and will not permit any of its Restricted Subsidiaries other Credit Party to, enter into Liquidate any Hedge Transactions Agreement in respect of interest rates with commodities unless (x) if such Swap Liquidation would result in an Approved Counterparty, except as follows: (i) Hedge Transactions effectively converting interest rates from fixed to floating, the notional amounts of which (when aggregated with all other Hedge Transactions automatic redetermination of the Borrowing Base pursuant to Section 4.6, Borrower and the other Credit Parties then in effect effectively converting interest rates from fixed to floating) do not exceed 100% of the then outstanding principal amount of the Credit Parties’ Obligations for borrowed money that bears interest at a fixed rate and (ii) Hedge Transactions effectively converting interest rates from floating to fixed, the notional amounts of which (when aggregated with all other Hedge Transactions of the Borrower and the other Credit Parties then in effect effectively converting interest rates from floating to fixed) do not exceed 100% of the then outstanding principal amount of the Credit Parties’ Obligations for borrowed money that bears interest at a floating rate. For purposes of this Section 9.18, forecasts of projected production shall equal the projections for proved developed producing reserves of each crude oil and natural gas set out in the most recent Reserve Report delivered to the Administrative Agent as revised in good faith to account for any increase or reductions therein anticipated based on information obtained by the Borrower subsequent to the publication of the such Reserve Report, including the Borrower’s internal forecasts of production decline rates for existing w▇▇▇▇ and additions to or deletions from anticipated future production from new w▇▇▇▇ and acquisitions coming on stream or failing to come on stream and Dispositions of Oil and Gas Properties, each as reflected in a separate or supplemental Reserve Report delivered to the Administrative Agent and otherwise satisfactory delivers reasonable prior written notice thereof to the Administrative Agent, and (y) if a Borrowing Base Deficiency would result from such Swap Liquidation as a result of an automatic redetermination of the Borrowing Base pursuant to Section 4.6, Borrower prepays Borrowings, prior to or contemporaneously with the consummation of such Swap Liquidation to the extent that such prepayment would have been required under Section 2.6(a) after giving effect to such automatic redetermination of the Borrowing Base.

Hedge Transactions. (a) The Borrower will not, and nor will not Borrower permit any of its Restricted Subsidiaries other Credit Party to, enter into any commodity Hedge Transaction except that the Borrower or other Credit Party shall be permitted to enter into, as of any date, commodity Hedge Transactions with an Approved Counterparty related to bona fide (and not speculative) hedging activities of the Borrower or other Credit Party with respect to which the aggregate notional volumes covered thereby do not exceedor, subject to clause (bB) belowof the proviso in the first sentence of Section 9.5, when aggregated permit to exist any Oil and netted with all other commodity Gas Hedge Transactions (other than “put” optionspurchased put options or price floors with respect to Hydrocarbons) (a) with a duration longer than five years from the date the applicable Oil and Gas Hedge Transaction is entered into or (b) whereby the volume of the Borrower and the other Credit Parties then in effect, Hydrocarbons with respect to which a settlement payment is calculated would exceed (i) for any month during the first 24 months after the date of execution of such Hedge Transaction (the “First Measurement Period”), 100% and (ii) for any month during the first 36 months immediately following the First Measurement Period, 75%, in each case, (x) of the Borrower’s and the other Credit Parties’ reasonably anticipated projected production (assuming no curtailment or interruption of transportation for such anticipated production) of (A) crude oil (for crude oil related Hedge Transactions) from Proved Mineral Interests and (By) natural gas (for natural gas related Hedge Transactions)without duplication of the “put” and “call”, in each casenotional quantities of any collars. Borrower will not, for such month, from the Borrower’s and the other Credit Parties’ Oil and Gas Properties constituting proved developed producing reserves. (b) It is understood that commodity Hedge Transactions that may, from time to time, “hedge” the same volumes, but different elements of commodity risk thereof (e.g., commodity price risk versus basis risk), shall not be aggregated together when calculating the foregoing limitations on notional volumes. (c) Notwithstanding anything to the contrary in this Section 9.18, there shall be no prohibition under this Agreement or any other Loan Paper against the nor will Borrower or permit any other Credit Party entering to, enter into purchased “put” options not otherwise prohibited hereunderany commodity, in each caseinterest rate, so long as such agreements are entered into with an Approved Counterparty in currency or other swap, option, collar or other derivative transaction pursuant to which any Credit Party speculates on the ordinary course of business for the purpose of hedging against fluctuations movement of commodity prices. (d) Neither the Borrower nor any Restricted Subsidiary will enter into any Hedge Transaction for the purpose of speculation (whether with respect to the levels of commodity prices in the future , securities prices, interest rates, financial markets, currency markets or otherwise). (e) In no event shall any Swap Agreement contain any requirement, agreement or covenant for the Borrower or any Restricted Subsidiary to post collateral, credit support (including a letter of credit) or margin to secure their obligations under such Swap Agreement or to cover market exposuresother items; provided that that, nothing contained in this sentence Section 9.10 shall not (i) prevent a Lender Swap Provider from requiring the obligations under its Swap Agreement with any Credit Party to be secured by the Liens granted to the Administrative Agent under the Security Instruments, or (ii) prohibit any Credit Party from being party (a) entering into interest rate swaps or other interest rate hedge transactions pursuant to any Swap Agreement with an Approved Counterparty that contains a requirement, agreement or covenant for any Person other than a which such Credit Party to post collateral, credit support (including a letter of credit) or margin to secure such Credit Party’s obligations under such Swap Agreement or to cover market exposures. (f) Neither the Borrower nor any of its Restricted Subsidiaries shall enter into any Hedge Transaction with a term longer than 60 months from the date such transaction is entered into. (g) If, after the end of any calendar month, the Borrower determines that the aggregate volume of all commodity Hedge Transactions for which settlement payments were calculated in such calendar month exceeded 100% of actual production of crude oil and natural gas, calculated separately, in such calendar month, then the Borrower shall, or shall cause one or more other Credit Parties to, within twenty (20) Business Days of such determinations terminate, create off-setting positions, allocate volumes to other production for which the Borrower and the other Credit Parties are marketing, or otherwise unwind existing commodity Hedge Transactions such that, at such time, future hedging volumes will not exceed 100% of reasonably anticipated projected production for the then-current and any succeeding calendar months. (h) The Borrower will not, and will not permit any of its Restricted Subsidiaries to, enter into any Hedge Transactions in respect of interest rates with an Approved Counterparty, except as follows: (i) Hedge Transactions effectively converting interest rates from fixed to floating, the notional amounts of which (when aggregated with all other Hedge Transactions of the Borrower and the other Credit Parties then in effect effectively converting interest rates from fixed to floating) do not exceed 100% of the then outstanding principal amount of the Credit Parties’ Obligations for borrowed money that bears interest at a fixed rate and (ii) Hedge Transactions effectively converting interest rates from floating to fixed, the notional amounts of which (when aggregated with all other Hedge Transactions of the Borrower and the other Credit Parties then in effect effectively converting interest rates from floating to fixed) do not exceed 100% of the then outstanding principal amount of the Credit Parties’ Obligations for borrowed money that bears interest at a floating rate. For purposes of this Section 9.18, forecasts of projected production shall equal the projections for proved developed producing reserves of each crude oil and natural gas set out in the most recent Reserve Report delivered to the Administrative Agent as revised in good faith to account for any increase or reductions therein anticipated based on information obtained by the Borrower subsequent to the publication of the such Reserve Report, including the Borrower’s internal forecasts of production decline rates for existing w▇▇▇▇▇▇ and additions interest rate risk with respect to or deletions from the interest reasonably anticipated future production from new w▇▇▇▇ and acquisitions coming on stream or failing to come on stream and Dispositions of be incurred pursuant to this Agreement, (b) entering into Oil and Gas PropertiesHedge Transactions otherwise permitted by this Section 9.10, each as reflected in a separate or supplemental Reserve Report delivered to the Administrative Agent and otherwise satisfactory to the Administrative Agent(c) making Permitted Investments.

Hedge Transactions. (a) The Borrower will not, and will not permit any of its Restricted Subsidiaries to, enter into any commodity Hedge Transaction except that the Borrower or other Credit Loan Party shall be permitted to enter into, as of any date, date commodity Hedge Transactions with an Approved Counterparty related to bona fide (and not speculative) hedging activities of the Borrower or other Credit Loan Party with respect to which the aggregate notional volumes covered thereby do not exceed, subject to clause (b) below, when aggregated and netted with all other commodity Hedge Transactions (other than “put” options) of the Borrower and the other Credit Loan Parties then in effect, (i) for any month during the first 24 months period from the then-current date until four (4) years after the date of execution of such Hedge Transaction (the “First Measurement Period”)then-current date, 10085% and (ii) for any month during the first 36 months immediately following the First Measurement Period, 75%, in each case, of the Borrower’s and the other Credit Loan Parties’ reasonably anticipated projected production (assuming no curtailment or interruption of transportation for such anticipated production) of (A) crude oil (for crude oil related Hedge Transactions) ), and (B) 85% of the Borrower’s and the other Loan Parties’ reasonably anticipated projected production of natural gas (for natural gas related Hedge Transactions), in each case, for such month, from the Borrower’s and the other Credit Loan Parties’ Oil and Gas Properties constituting proved developed producing reserves. (b) It is understood that commodity Hedge Transactions that may, from time to time, “hedge” the same volumes, but different elements of commodity risk thereof (e.g., commodity price risk versus basis risk), shall not be aggregated together when calculating the foregoing limitations on notional volumes. (c) Notwithstanding anything to the contrary in this Section 9.186.18, there shall be no prohibition under this Agreement or any other Loan Paper Document against the Borrower or any other Credit Loan Party entering into purchased “put” options not otherwise prohibited hereunder, in each case, so long as such agreements are entered into with an Approved Counterparty in the ordinary course of business for the purpose of hedging against fluctuations of commodity prices. (d) Neither the Borrower nor any Restricted Subsidiary will enter into any Hedge Transaction for the purpose of speculation (whether with respect to the levels of commodity prices in the future or otherwise). (e) In no event shall any Swap Hedge Agreement contain any requirement, agreement or covenant for the Borrower or any Restricted Subsidiary to post collateral, credit support (including a letter of credit) or margin to secure their obligations under such Swap Hedge Agreement or to cover market exposures; provided that this sentence shall not (i) prevent a an Lender Swap Provider Counterparty from requiring the obligations under its Swap Hedge Agreement with any Credit Loan Party to be secured by the Liens granted to the Administrative Agent under the Security InstrumentsDocuments, or (ii) prohibit any Credit Loan Party from being party to any Swap Hedge Agreement with an Approved Counterparty that contains a requirement, agreement or covenant for any Person other than a Credit Loan Party to post collateral, credit support (including a letter of credit) or margin to secure such Credit Loan Party’s obligations under such Swap Hedge Agreement or to cover market exposures. (f) Neither the Borrower nor any of its Restricted Subsidiaries shall enter into any Hedge Transaction with a term longer than 60 months from the date such transaction is entered into. (g) If, after the end of any calendar month, the Borrower determines that the aggregate volume of all commodity Hedge Transactions for which settlement payments were calculated in such calendar month exceeded 100% of actual production of crude oil and natural gas, calculated separately, in such calendar month, then the Borrower shall, or shall cause one or more other Credit Loan Parties to, within twenty (20) Business Days of such determinations terminate, create off-setting positions, allocate volumes to other production for which the Borrower and the other Credit Loan Parties are marketing, or otherwise unwind existing commodity Hedge Transactions such that, at such time, future hedging volumes will not exceed 100% of reasonably anticipated projected production for the then-current and any succeeding calendar months. (h) The Borrower will not, and will not permit any of its Restricted Subsidiaries to, enter into any Hedge Transactions in respect of interest rates with an Approved Counterparty, except as follows: (i) Hedge Transactions effectively converting interest rates from fixed to floating, the notional amounts of which (when aggregated with all other Hedge Transactions of the Borrower and the other Credit Loan Parties then in effect effectively converting interest rates from fixed to floating) do not exceed 100% of the then outstanding principal amount of the Credit Loan Parties’ Obligations Indebtedness for borrowed money that bears interest at a fixed rate and (ii) Hedge Transactions effectively converting interest rates from floating to fixed, the notional amounts of which (when aggregated with all other Hedge Transactions of the Borrower and the other Credit Loan Parties then in effect effectively converting interest rates from floating to fixed) do not exceed 100% of the then outstanding principal amount of the Credit Loan Parties’ Obligations Indebtedness for borrowed money that bears interest at a floating rate. For purposes of this Section 9.186.18, forecasts of projected production shall equal the projections for proved developed producing reserves of each crude oil and natural gas set out in the most recent Reserve Report delivered to the Administrative Agent as revised in good faith to account for any increase or reductions therein anticipated based on information obtained by the Borrower subsequent to the publication of the such Reserve Report, including the Borrower’s internal forecasts of production decline rates for existing w▇▇▇▇▇ and additions to or deletions from anticipated future production from new w▇▇▇▇▇ and acquisitions coming on stream or failing to come on stream and Dispositions of Oil and Gas Properties, each as reflected in a separate or supplemental Reserve Report delivered to the Administrative Agent and otherwise satisfactory to the Administrative Agent.