b'these factors could cause our cost of doing business to increase, limit our access to capital, limit ourability to pursue acquisition opportunities, reduce our cash flows available for drilling and place us at acompetitive disadvantage. Recent and continuing disruptions and volatility in the global financialmarkets may lead to an increase in interest rates or a contraction in credit availability impacting ourability to finance our operations. We require continued access to capital. A significant reduction in theavailability of credit could materially and adversely affect our ability to achieve our planned growth andoperating results.Our derivative activities could result in financial losses or could reduce our income.To achieve more predictable cash flows and to reduce our exposure to adverse fluctuations in theprices of oil and natural gas, we have and may in the future enter into derivative arrangements for aportion of our oil and natural gas production, including, but not limited to, puts, collars and fixed-priceswaps. In addition, we may in the future, hold swaps designed to hedge our interest rate risk. We donot currently designate any of our derivative instruments as hedges for accounting purposes and recordall derivative instruments on our balance sheet at fair value. Changes in the fair value of our derivativeinstruments are recognized in earnings. Accordingly, our earnings may fluctuate significantly as a resultof changes in the fair value of our derivative instruments.Derivative arrangements also expose us to the risk of financial loss in some circumstances,including when:\x7f production is less than the volume covered by the derivative instruments;\x7f the counter-party to the derivative instrument defaults on its contract obligations; or\x7f there is an increase in the differential between the underlying price and actual prices received inthe derivative instrument.In addition, these types of derivative arrangements may limit the benefit we could receive fromincreases in the prices for oil and natural gas or beneficial interest rate fluctuations and may expose usto cash margin requirements.Our commercial debt facility, revolving credit facility and indenture governing the Senior Notes containcertain covenants that may inhibit our ability to make certain investments, incur additional indebtedness andengage in certain other transactions, which could adversely affect our ability to meet our future goals.Our commercial debt facility, revolving credit facility and indenture governing the Senior Notesinclude certain covenants that, among other things, restrict:\x7f our investments, loans and advances and certain of our subsidiaries payment of dividends andother restricted payments;\x7f our incurrence of additional indebtedness;\x7f the granting of liens, other than liens created pursuant to the commercial debt facility, revolvingcredit facility or the indenture governing the Senior Notes and certain permitted liens;\x7f mergers, consolidations and sales of all or a substantial part of our business or licenses;\x7f the hedging, forward sale or swap of our production of crude oil or natural gas or othercommodities;\x7f the sale of assets (other than production sold in the ordinary course of business); and\x7f in the case of the commercial debt facility and the revolving credit facility, our capitalexpenditures that we can fund with the proceeds of our commercial debt facility, and revolvingcredit facility.62'