RECENT FINANCIAL STATEMENTS
REFERRED TO IN SECTION 2.16 OF THE AGREEMENT;
(7)
A FAVOURABLE OPINION OF COUNSEL FOR THE
BORROWER (IN FORM AND CONTENT SATISFACTORY TO THE SOLICITORS FOR ROYAL) TO THE
EFFECT THAT:
(A)
THE BORROWER AND EACH OF THE BORROWER
SUBSIDIARIES HAS BEEN DULY INCORPORATED, AMALGAMATED OR CONTINUED UNDER THE LAWS
OF THE PROVINCE OF BRITISH COLUMBIA AND IS, ACCORDING TO THE RECORDS
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OF THE OFFICE OF THE REGISTRAR OF COMPANIES FOR THE PROVINCE OF BRITISH
COLUMBIA, AN EXISTING COMPANY IN GOOD STANDING WITH RESPECT TO THE FILING OF ITS
ANNUAL REPORTS;
(B)
THE BORROWER AND EACH OF THE BORROWER
SUBSIDIARIES HAVE THE CORPORATE POWER AND CAPACITY TO BORROW MONEY AND GRANT
SECURITY THEREFORE IN THE MANNER CONTEMPLATED BY THE AGREEMENT AND ROYAL'S
SECURITY AND TO ENTER INTO, OBSERVE AND PERFORM THE TERMS AND OBLIGATIONS ON ITS
PART TO BE OBSERVED AND PERFORMED UNDER THE AGREEMENT AND ROYAL'S SECURITY;
(C)
THE BORROWER HAS DULY AUTHORIZED, EXECUTED
AND DELIVERED THE AGREEMENT AND THAT ROYAL'S SECURITY TO WHICH IT IS A PARTY AND
EACH OF THE BORROWER SUBSIDIARIES HAVE DULY AUTHORIZED, EXECUTED AND DELIVERED
THAT ROYAL'S SECURITY TO WHICH IT IS A PARTY, THE AGREEMENT AND SUCH ROYAL'S
SECURITY CONSTITUTE VALID, BINDING AND ENFORCEABLE OBLIGATIONS OF THE BORROWER
AND THE BORROWER SUBSIDIARIES (AS APPLICABLE) IN ACCORDANCE WITH ITS TERMS, SAVE
AS ENFORCEMENT MAY BE LIMITED BY:
(I)
APPLICABLE BANKRUPTCY, INSOLVENCY,
MORATORIUM OR REORGANIZATION OR OTHER LAWS AFFECTING CREDITORS' RIGHTS
GENERALLY;
(II)
THE UNAVAILABILITY OF EQUITABLE REMEDIES
SUCH AS THE REMEDY OF SPECIFIC PERFORMANCE AND INJUNCTION IN ANY PARTICULAR
INSTANCE;
(III)
THE INABILITY OF THE COURTS OF CANADA TO
GIVE JUDGEMENT FOR PAYMENT IN FOREIGN CURRENCIES; AND
(IV)
SUCH OTHER QUALIFICATIONS AND LIMITATIONS AS
COUNSEL FOR ROYAL MAY ACCEPT ACTING REASONABLY;
(D)
SO FAR AS THEY ARE AWARE IN THEIR CAPACITY AS
COUNSEL FOR THE BORROWER IN RESPECT OF THIS TRANSACTION, THERE ARE NO ACTIONS,
PROCEEDINGS OR INVESTIGATIONS PENDING OR THREATENED AGAINST THE BORROWER WHICH
QUESTION THE VALIDITY OF THE AGREEMENT OR ROYAL'S SECURITY OR THE VALIDITY OF
ANY ACT TO BE TAKEN PURSUANT THERETO,
and, in addition, dealing with such other matters incidental to the transactions
contemplated by the Agreement as Royal may reasonably and properly require;
(8)
AN OPINION OF MESSRS. BULL, HOUSSER &
TUPPER, COUNSEL FOR ROYAL (IN FORM AND CONTENT SATISFACTORY TO ROYAL BUT SUBJECT
TO THE USUAL ASSUMPTIONS AND QUALIFICATIONS) TO THE EFFECT THAT THE AGREEMENT
AND ROYAL'S SECURITY HAVE BEEN EXECUTED BY ALL PARTIES THERETO AND DELIVERED TO
ROYAL AND THAT
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SUCH ITEMS OF ROYAL'S SECURITY WHICH REQUIRE REGISTRATION OR FILING HAVE BEEN
REGISTERED OR FILED IN ALL PLACES AND OFFICES IN BRITISH COLUMBIA AND ELSEWHERE
(AS MAY BE DETERMINED BY COUNSEL FOR ROYAL) WHERE SUCH REGISTRATION OR FILING IS
NECESSARY;
(B)
DELIVERY BY THE GUARANTOR TO ROYAL OF THE
FOLLOWING:
(1)
THE DULY EXECUTED GUARANTEE AND
SUBORDINATION AGREEMENT;
(2)
A CERTIFICATE OF GOOD STANDING FOR THE
GUARANTOR;
(3)
A CERTIFIED COPY OF THE CHARTER FOR THE
GUARANTOR;
(4)
A CERTIFIED