Document:

Exhibit 10.4

 

Execution Version

 

FIRST LIEN PLEDGE AND SECURITY AGREEMENT

AND IRREVOCABLE PROXY

 

This FIRST LIEN PLEDGE
AND SECURITY AGREEMENT AND IRREVOCABLE PROXY, effective as of December 30, 2016 (as amended, supplemented, amended and restated
or otherwise modified from time to time, this “Security Agreement”), is made by ENERGY XXI GULF COAST, INC.
and each of its undersigned subsidiaries (each, a “Grantor” and, together with each of the other signatories
hereto and any other entities from time to time party hereto, the “Grantors”), in favor of the Administrative
Agent and each of the Secured Parties (each as defined below).

 

WITNESSETH:

 

WHEREAS, reference is made
to the First Lien Exit Credit Agreement, dated as of December 30, 2016, by and among Energy XXI Gulf Coast, Inc., a Delaware corporation
(“Borrower”), the lenders party thereto (the “Lenders”), Wells Fargo Bank, N.A., as administrative
agent for the Lenders (in such capacity, the “Administrative Agent”), and the other parties party thereto (as
amended, supplemented, amended and restated or otherwise modified from time to time, the “First Lien Credit Agreement”);

 

WHEREAS, each Grantor has
duly authorized the execution, delivery and performance of this Security Agreement; and

 

WHEREAS, each Grantor (other
than Borrower) is a wholly owned Subsidiary of Borrower and it is in the best interests of each Grantor to execute this Security
Agreement inasmuch as each Grantor will derive substantial direct and indirect benefits from the First Lien Credit Agreement.

 

NOW, THEREFORE, for good
and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each Grantor agrees, for the benefit
of each Secured Party, as follows:

 

ARTICLE
I.

DEFINITIONS

 

SECTION 1.1.          Certain
Terms. The following terms (whether or not underscored) when used in this Security Agreement, including its preamble and recitals,
shall have the following meanings (such definitions to be equally applicable to the singular and plural forms thereof):

 

“Administrative
Agent” means Wells Fargo Bank, N.A., in its capacity as “Administrative Agent” under the First Lien Credit
Agreement and the other Loan Documents, together with any successor(s) and assign(s) thereto.

 

“Collateral”
is defined in Section 2.1.

 

“Collateral Account”
is defined in Section 4.3(b).

 

     

     

    

 

“Computer Hardware
and Software Collateral” means (a) all computer and other electronic data processing hardware, integrated computer systems,
central processing units, memory units, display terminals, printers, features, computer elements, card readers, tape drives, hard
and soft disk drives, cables, electrical supply hardware, generators, power equalizers, accessories and all peripheral devices
and other related computer hardware, including all operating system software, utilities and application programs in whatsoever
form, (b) software programs (including both source code, object code and all related applications and data files), designed for
use on the computers and electronic data processing hardware described in clause (a) above, (c) all firmware associated
therewith, (d) all documentation (including flow charts, logic diagrams, manuals, guides, specifications, training materials, charts
and pseudo codes) with respect to such hardware, software and firmware described in the preceding clauses (a) through (c),
and (e) all rights with respect to all of the foregoing, including copyrights, licenses, options, warranties, service contracts,
program services, test rights, maintenance rights, support rights, improvement rights, renewal rights and indemnifications and
any substitutions, replacements, improvements, error corrections, updates, additions or model conversions of any of the foregoing.

 

“Control Agreement”
means an authenticated record in form and substance reasonably satisfactory to the Administrative Agent, that provides for the
Administrative Agent to have “control” (as defined in the UCC) over certain Collateral.

 

“Copyright Collateral”
means all copyrights of any Grantor, registered or unregistered and whether published or unpublished, now or hereafter in force
throughout the world including all of such Grantor’s rights, titles and interests in and to all copyrights registered in
the United States Copyright Office or anywhere else in the world, including without limitation those copyrights referred to in
Item C of Schedule III hereto, and registrations and recordings thereof and all applications for registration thereof,
whether pending or in preparation, all copyright licenses, the right to sue for past, present and future infringements of any of
the foregoing, all rights corresponding thereto, all extensions and renewals of any thereof and all Proceeds of the foregoing,
including licenses, royalties, income, payments, claims, damages and Proceeds of suit, which are owned or licensed by such Grantor.

 

“Distributions”
means all cash, cash dividends, stock dividends, other distributions, liquidating dividends, shares of stock resulting from (or
in connection with the exercise of) stock splits, reclassifications, warrants, options, non-cash dividends, mergers, consolidations,
and all other distributions or payments (whether similar or dissimilar to the foregoing) on or with respect to, or on account of,
any Pledged Share or Pledged Interest or other rights or interests constituting Collateral.

 

“Equipment”
is defined in Section 2.1(a).

 

“First Lien Credit
Agreement” is defined in the first recital.

 

“General Intangibles”
means all “general intangibles” and all “payment intangibles”, each as defined in the UCC, and shall include
all interest rate or currency protection or hedging arrangements, all tax refunds, all licenses, permits, concessions and authorizations
and all Intellectual Property Collateral (in each case, regardless of whether characterized as general intangibles under the UCC).

 

    	 	- 2 -	EXXI Pledge and Security Agreement

     

    

 

“Governmental
Approval” is defined in Section 2.1(f).

 

“Grantor”
is defined in the preamble.

 

“Indemnified Parties”
is defined in Section 6.5(a).

 

“Intellectual
Property Collateral” means, collectively, the Computer Hardware and Software Collateral, the Copyright Collateral, the
Patent Collateral, the Trademark Collateral and the Trade Secrets Collateral.

 

“Inventory”
is defined in Section 2.1(b).

 

“Patent Collateral”
means (a) all inventions and discoveries, whether patentable or not, all letters patent and applications for letters patent throughout
the world, including without limitation those patents referred to in Item A of Schedule III hereto, and any patent
applications in preparation for filing, (b) all reissues, divisions, continuations, continuations-in-part, extensions, renewals
and reexaminations of any of the items described in clause (a), (c) all patent licenses, and other agreements providing
any Grantor with the right to use any items of the type referred to in clauses (a) and (b) above, and (d) all Proceeds
of, and rights associated with, the foregoing (including licenses, royalties income, payments, claims, damages and Proceeds of
infringement suits), the right to sue third parties for past, present or future infringements of any patent or patent application,
and for breach or enforcement of any patent license.

 

“Permitted Liens”
means all Liens permitted by Section 7.2.3 of the First Lien Credit Agreement or any other Loan Document.

 

“Pledged Interests”
means all Capital Securities or other ownership interests of any Pledged Interests Issuer described in Item A of Schedule
I hereto; all registrations, certificates, articles, by-laws, regulations, limited liability company agreements or constitutive
agreements governing or representing any such interests; all options and other rights, contractual or otherwise, at any time existing
with respect to such interests, as such interests are amended, modified, or supplemented from time to time, and together with any
interests in any Pledge Interests Issuer taken in extension or renewal thereof or substitution therefor.

 

“Pledged Interests
Issuer” means each Person identified in Item A of Schedule I hereto as the issuer of the Pledged Shares
or the Pledged Interests identified opposite the name of such Person.

 

“Pledged Note
Issuer” means each Person identified in Item B of Schedule I hereto as the issuer of the Pledged Notes
identified opposite the name of such Person.

 

“Pledged Notes”
means all promissory notes of any Pledged Note Issuer evidencing Indebtedness incurred pursuant to of Section 7.2.2(f) of the First
Lien Credit Agreement in form and substance reasonably satisfactory to the Administrative Agent delivered by any Grantor to the
Administrative Agent as Pledged Property hereunder, as such promissory notes, in accordance with Section 7.3 hereof, are
amended, modified or supplemented from time to time and together with any promissory note of any Pledged Note Issuer taken in extension
or renewal thereof or substitution therefor.

 

    	 	- 3 -	EXXI Pledge and Security Agreement

     

    

 

“Pledged Property”
means all Pledged Notes, Pledged Interests, Pledged Shares, all assignments of any amounts due or to become due with respect to
the Pledged Interests or the Pledged Shares, all other instruments which are now being delivered by any Grantor to the Administrative
Agent or may from time to time hereafter be delivered by any Grantor to the Administrative Agent for the purpose of pledge under
this Security Agreement or any other Loan Document, and all proceeds of any of the foregoing.

 

“Pledged Shares”
means all Capital Securities of any Pledged Interests Issuer identified under Item A of Schedule I which are delivered
by any Grantor to the Administrative Agent as Pledged Property hereunder.

 

“Receivables”
is defined in Section 2.1(c).

 

“Related Contracts”
is defined in Section 2.1(c).

 

“Secured Obligations”
is defined in Section 2.2.

 

“Securities Act”
is defined in Section 6.2(a).

 

“Security Agreement”
is defined in the preamble.

 

“Trademark Collateral”
means (a) (i) all trademarks, trade names, corporate names, company names, business names, fictitious business names, trade styles,
service marks, certification marks, collective marks, logos and other source or business identifiers, and all goodwill of the business
associated therewith, now existing or hereafter adopted or acquired, including without limitation those trademarks referred to
in Item B of Schedule III hereto, whether currently in use or not, all registrations and recordings thereof and all
applications in connection therewith, whether pending or in preparation for filing, including registrations, recordings and applications
in the United States Patent and Trademark Office or in any office or agency of the United States of America, or any State thereof
or any other country or political subdivision thereof or otherwise, and all common-law rights relating to the foregoing, and (ii)
the right to obtain all reissues, extensions or renewals of the foregoing (collectively referred to as the “Trademark”),
(b) all trademark licenses for the grant by or to any Grantor of any right to use any trademark, (c) all of the goodwill of the
business connected with the use of, and symbolized by the items described in, clause (a), and to the extent applicable clause
(b), (d) the right to sue third parties for past, present and future infringements of any Trademark Collateral described in
clause (a) and, to the extent applicable, clause (b), and (e) all Proceeds of, and rights associated with, the foregoing,
including any claim by any Grantor against third parties for past, present or future infringement or dilution of any Trademark,
Trademark registration or Trademark license, or for any injury to the goodwill associated with the use of any such Trademark or
for breach or enforcement of any Trademark license and all rights corresponding thereto throughout the world.

 

    	 	- 4 -	EXXI Pledge and Security Agreement

     

    

 

“Trade Secrets
Collateral” means all common law and statutory trade secrets and all other confidential, proprietary or useful information
and all know-how obtained by or used in or contemplated at any time for use in the business of any Grantor, (all of the foregoing
being collectively called a “Trade Secret”), including all Documents and things embodying, incorporating or
referring in any way to such Trade Secret, all Trade Secret licenses, and including the right to sue for and to enjoin and to collect
damages for the actual or threatened misappropriation of any Trade Secret and for the breach or enforcement of any such Trade Secret
license.

 

“UCC”
means the Uniform Commercial Code, as in effect in the State of New York, as the same may be amended from time to time.

 

SECTION 1.2.          First
Lien Credit Agreement Definitions. Unless otherwise defined herein or the context otherwise requires, terms used in this Security
Agreement, including its preamble and recitals, have the meanings provided in the First Lien Credit Agreement.

 

SECTION 1.3.          UCC
Definitions. Unless otherwise defined herein or the context otherwise requires, terms for which meanings are provided in the
UCC are used in this Security Agreement, including its preamble and recitals, with such meanings.

 

ARTICLE
II.

SECURITY INTEREST

 

SECTION 2.1.          Grant
of Security Interest. Each Grantor hereby pledges, hypothecates, assigns, charges, mortgages, delivers, and transfers to the
Administrative Agent, for its benefit and the ratable benefit of each of the Secured Parties, and hereby grants to the Administrative
Agent, for its benefit and the ratable benefit of each of the other Secured Parties, a continuing security interest in all of such
Grantor’s following property, whether now or hereafter existing, owned or acquired by such Grantor, and wherever located
(collectively for all Grantors, the “Collateral”):

 

(a)          all
equipment in all of its forms of such Grantor, wherever located, and all machinery, apparatus, installation facilities and other
tangible personal property, and all parts thereof and all accessions, additions, attachments, improvements, substitutions, replacements
and proceeds thereto and therefor (any and all of the foregoing being the “Equipment”);

 

(b)          all
inventory in all of its forms of such Grantor, wherever located, including (i) all oil, gas, or other hydrocarbons and all products
and substances derived therefrom, all raw materials and work in process therefore, finished goods thereof, and materials used or
consumed in the manufacture or production thereof, (ii) all goods in which such Grantor has an interest in mass or a joint or other
interest or right of any kind (including goods in which such Grantor has an interest or right as consignee), and (iii) all goods
which are returned to or repossessed by such Grantor, and all accessions thereto, products thereof and documents therefore (any
and all such inventory, materials, goods, accessions, products and documents being the “Inventory”);

 

    	 	- 5 -	EXXI Pledge and Security Agreement

     

    

 

(c)          all
accounts, money, payment intangibles, deposit accounts (including, without limitation, each Deposit Account of Borrower and its
Subsidiaries identified on Item 6.19(a) of the Disclosure Schedule attached to the First Lien Credit Agreement and the Collateral
Accounts and all amounts on deposit therein and all cash equivalent investments carried therein and all proceeds thereof), contracts,
contract rights, all rights constituting a right to the payment of money, chattel paper, documents, documents of title, instruments,
letters of credit, letter-of-credit rights and General Intangibles of such Grantor, whether or not earned by performance or arising
out of or in connection with the sale or lease of goods or the rendering of services, including all moneys due or to become due
in repayment of any loans or advances, and all rights of such Grantor now or hereafter existing in and to all security agreements,
guaranties, leases, agreements and other contracts securing or otherwise relating to any such accounts, money, payment intangibles,
deposit accounts, contracts, contract rights, rights to the payment of money, chattel paper, documents, documents of title, instruments,
letters of credit, letter-of-credit rights and General Intangibles (any and all such accounts, money, payment intangibles, deposit
accounts, contracts, contract rights, rights to the payment of money, chattel paper, documents, documents of title, instruments,
letters of credit, letter-of-credit rights and General Intangibles being the “Receivables”, and any and all
such security agreements, guaranties, leases, agreements and other contracts being the “Related Contracts”);

 

(d)          all
Intellectual Property Collateral of such Grantor;

 

(e)          all
books, correspondence, credit files, records, invoices, tapes, cards, computer runs, writings, data bases, information in all forms,
paper and documents and other property relating to, used or useful in connection with, evidencing, embodying, incorporating or
referring to, any of the foregoing in this Section 2.1;

 

(f)          all
governmental approvals, permits, licenses, authorizations, consents, rulings, tariffs, rates, certifications, waivers, exemptions,
filings, claims, orders, judgments and decrees (each a “Governmental Approval”), to the extent a security interest
may be granted therein; provided that any Governmental Approval that by its terms or by operation of law would be void, voidable,
terminable or revocable if mortgaged, pledged or assigned hereunder is expressly excepted and excluded from the Liens and terms
of this Security Agreement, including the grant of security interest in this Section 2.1;

 

(g)          all
interest rate swap agreements, interest rate cap agreements and interest rate collar agreements, and all other agreements or arrangements
designed to protect such Grantor against fluctuations in interest rates or currency exchange rates and all commodity hedge, commodity
swap, exchange, forward, future, floor, collar or cap agreements, fixed price agreements and all other agreements or arrangements
designed to protect such Grantor against fluctuations in commodity prices (including, without limitation, any Hedging Agreement);

 

(h)          to
the extent not included in the foregoing, all bank accounts, investment property, fixtures and supporting obligations;

 

(i)          all
Pledged Interests, Pledged Notes, Pledged Shares and any other Pledged Property whether now or hereafter delivered to the Administrative
Agent in connection with this Security Agreement and all Distributions, interest, and other payments and rights with respect to
such Pledged Property;

 

    	 	- 6 -	EXXI Pledge and Security Agreement

     

    

 

(j)          all
insurance and insurance policies;

 

(k)          all
accessions, substitutions, replacements, products, offspring, rents, issues, profits, returns, income and proceeds of and from
any and all of the foregoing Collateral (including proceeds which constitute property of the types described in clauses
(a), (b), (c), (d), (e), (f), (g), (h), (i) and (j) and proceeds
deposited from time to time in any lock boxes of such Grantor, and, to the extent not otherwise included, all payments and proceeds
under insurance (whether or not the Administrative Agent is the loss payee thereof), or any condemnation award, indemnity, warranty
or guaranty, payable by reason of loss or damage to or otherwise with respect to any of the Collateral); and

 

(l)          all
of such Grantor’s other property and rights of every kind and description and interests therein, including without limitation,
all other “Accounts”, “Certificated Securities”, “Chattel Paper”, “Commercial Tort Claims”,
“Commodity Accounts”, “Commodity Contracts”, “Deposit Accounts”, “Documents”, “Equipment”,
“Fixtures”, “General Intangibles”, “Goods”, “Instruments”, “Inventory”,
“Investment Property”, “Letter of Credit Rights”, “Letters of Credit”, “Money”,
“Proceeds”, “Securities”, “Securities Account”, “Security Entitlements”, “Supporting
Obligations” and “Uncertificated Securities” as such terms are defined in the UCC.

 

Notwithstanding anything
in the foregoing to the contrary, the term “Collateral” shall not include any Excluded Securities.

 

SECTION 2.2.          Security
for Obligations. This Security Agreement, and the Collateral in which the Administrative Agent for the benefit of the Secured
Parties is granted a security interest hereunder by each Grantor, secures the prompt and indefeasible payment in full and performance
of all Obligations of such Grantor and each other Obligor now or hereafter existing under the First Lien Credit Agreement, the
Guaranties and each other Loan Document and each Bank Product Agreement with a Bank Product Provider, whether for principal, interest,
costs, fees, expenses or otherwise, and any and all other obligations of such Grantor and each other Obligor to the Secured Parties,
howsoever created, arising or evidenced, whether direct or indirect, primary or secondary, fixed or absolute or contingent, joint
or several, or now or hereafter existing under this Security Agreement and each other Loan Document and Bank Product Agreement
to which it is or may become a party (all such Obligations and other obligations of the Borrower and such Grantor being the “Secured
Obligations”). Notwithstanding the foregoing, with respect to any Obligor (other than the Borrower) the term Secured
Obligations shall not include Excluded Swap Obligations.

 

    	 	- 7 -	EXXI Pledge and Security Agreement

     

    

 

SECTION 2.3.          Continuing
Security Interest; Transfer of Loans. This Security Agreement shall create a continuing security interest in the Collateral
and shall (a) remain in full force and effect until the Termination Date, (b) be binding upon each Grantor and its successors,
transferees and assigns, and (c) inure, together with the rights and remedies of the Administrative Agent hereunder, to the benefit
of the Administrative Agent and each other Secured Party and their respective successors, transferees and assigns. Without limiting
the generality of the foregoing clause (c), any Lender may assign or otherwise transfer (in whole or in part) any Note or
any Loan held by it as provided in Section 10.11 of the First Lien Credit Agreement and any Secured Party may assign or otherwise
transfer (in whole or in part) its interest pursuant to any Hedging Agreement or any Bank Product Agreement, and any successor
or assignee thereof shall thereupon become vested with all the rights and benefits in respect thereof granted to such Secured Party
under any Loan Document (including this Security Agreement), or otherwise, subject, however, to any contrary provisions in such
assignment or transfer, and as applicable to the provisions of Section 10.11 and Article 9 of the First Lien Credit Agreement,
and, with respect to the Hedging Agreements and the Bank Product Agreements, the limitation on rights in collateral pursuant to
the Security Documents. Upon the Termination Date, the security interest granted herein shall terminate and all rights to the Collateral
shall revert to the applicable Grantor. Upon any such payment and termination or expiration, the Administrative Agent will, at
the Grantors’ sole expense, deliver to each applicable Grantor, without any representations, warranties or recourse of any
kind whatsoever, all certificates and instruments representing or evidencing all Pledged Notes, Pledged Shares and Pledged Interests,
together with all other Collateral held by the Administrative Agent hereunder, and execute and deliver to any Grantor such documents
as such Grantor shall reasonably request to evidence such termination. If at any time all or any part of any payment theretofore
applied by the Administrative Agent or any Secured Party to any of the Secured Obligations is or must be rescinded or returned
by the Administrative Agent or any such Secured Party for any reason whatsoever (including, without limitation, the insolvency,
bankruptcy, reorganization or other similar proceeding of any Grantor or any other Person), such Secured Obligations shall, for
purposes of this Security Agreement, to the extent that such payment is or must be rescinded or returned, be deemed to have continued
to be in existence, notwithstanding any application by the Administrative Agent or such Secured Party or any termination agreement
or release provided to any Grantor, and this Security Agreement shall continue to be effective or reinstated, as the case may be,
as to such Secured Obligations, all as though such application by the Administrative Agent or such Secured Party had not been made.

 

SECTION 2.4.          Grantor
Remains Liable. Anything herein to the contrary notwithstanding, (a) each Grantor shall remain liable under the contracts and
agreements included in the Collateral to the extent set forth therein, and will perform all of its duties and obligations under
such contracts and agreements to the same extent as if this Security Agreement had not been executed, (b) the exercise by the Administrative
Agent of any of its rights hereunder shall not release any Grantor from any of its duties or obligations under any such contracts
or agreements included in the Collateral, and (c) neither the Administrative Agent nor any other Secured Party shall have any obligation
or liability under any contracts or agreements included in the Collateral by reason of this Security Agreement, nor shall the Administrative
Agent nor any Secured Party be obligated to perform any of the obligations or duties of any Grantor thereunder or to take any action
to collect or enforce any claim for payment assigned hereunder.

 

SECTION 2.5.          Delivery
of Pledged Property.

 

(a)          All
certificates or instruments representing or evidencing any Collateral, including all Pledged Shares and Pledged Notes, shall be
delivered to and held by or on behalf of (or in the case of the Pledged Notes, endorsed to the order of) the Administrative Agent
pursuant hereto, shall be in suitable form for transfer by delivery, and shall be accompanied by all necessary indorsements or
instruments of transfer or assignment, duly executed in blank.

 

    	 	- 8 -	EXXI Pledge and Security Agreement

     

    

 

(b)          To
the extent any of the Collateral constitutes an “uncertificated security” (as defined in Section 8-102(a)(18) of the
UCC) or a “security entitlement” (as defined in Section 8-102(a)(17) of the UCC), the applicable Grantor shall take
and cause the appropriate Person (including any issuer, entitlement holder or securities intermediary thereof) to take all actions
necessary to grant “control” (as defined in 8-106 of the UCC) to the Administrative Agent over such Collateral.

 

SECTION 2.6.          Distributions
on Pledged Shares. In the event that any Distribution with respect to any Pledged Shares or Pledged Interests pledged hereunder
is permitted to be paid (in accordance with Section 7.2.6 of the First Lien Credit Agreement), such Distribution or payment may
be paid directly to the applicable Grantor. If any Distribution is made in contravention of Section 7.2.6 of the First Lien Credit
Agreement, the applicable Grantor shall hold the same segregated and in trust for the Administrative Agent until paid to the Administrative
Agent in accordance with Section 4.1(e).

 

SECTION 2.7.          Security
Interest Absolute, etc. This Security Agreement shall in all respects be a continuing, absolute, unconditional and irrevocable
grant of security interest, and shall remain in full force and effect until the Termination Date. All rights of the Secured Parties
and the security interests granted to the Administrative Agent (for its benefit and the ratable benefit of each other Secured Party)
hereunder, and all obligations of the Grantors hereunder, shall, in each case, be absolute, unconditional and irrevocable irrespective
of (a) any lack of validity, legality or enforceability of any Loan Document or Bank Product Agreement, (b) the failure of any
Secured Party (i) to assert any claim or demand or to enforce any right or remedy against any Grantor or any other Obligor or any
other Person under the provisions of any Loan Document or Bank Product Agreement or otherwise, or (ii) to exercise any right or
remedy against any other guarantor of, or collateral securing, any Secured Obligations, (c) any change in the time, manner or place
of payment of, or in any other term of, all or any part of the Secured Obligations, or any other extension, compromise or renewal
of any Secured Obligations, (d) any reduction, limitation, impairment or termination of any Secured Obligations (except in the
case of the occurrence of the Termination Date) for any reason, including any claim of waiver, release, surrender, alteration or
compromise, and shall not be subject to (and each Grantor hereby waives any right to or claim of) any defense or setoff, counterclaim,
recoupment or termination whatsoever by reason of the invalidity, illegality, nongenuineness, irregularity, compromise, unenforceability
of, or any other event or occurrence affecting, any Secured Obligations or otherwise, (e) any amendment to, rescission, waiver,
or other modification of, or any consent to or departure from, any of the terms of any Loan Document or Bank Product Agreement,
(f) any addition, exchange or release of any Collateral for the Secured Obligations, or any surrender or non-perfection of any
collateral, or any amendment to or waiver or release or addition to, or consent to or departure from, any other guaranty held by
any Secured Party securing any of the Secured Obligations, or (g) any other circumstance which might otherwise constitute a defense
available to, or a legal or equitable discharge of any Grantor or any other Obligor, any surety or any other guarantor.

 

    	 	- 9 -	EXXI Pledge and Security Agreement

     

    

 

SECTION 2.8.          Waiver
of Subrogation. Until the Termination Date, each Grantor (other than Borrower) hereby irrevocably waives any claim or other
rights which it may now or hereafter acquire against the Borrower or any other Obligor that arise from the existence, payment,
performance or enforcement of such Grantor’s obligations under this Security Agreement or any other Loan Document or Bank
Product Agreement, including any right of subrogation, reimbursement, exoneration or indemnification, any right to participate
in any claim or remedy of any Secured Party against the Borrower or any other Obligor or any collateral which any Secured Party
now has or hereafter acquires, whether or not such claim, remedy or right arises in equity, or under contract, statute or common
law, including the right to take or receive from the Borrower or any other Obligor, directly or indirectly, in cash or other property
or by set-off or in any manner, payment or security on account of such claim or other rights. If any amount shall be paid to any
Grantor in violation of the preceding sentence and the Secured Obligations shall not have been indefeasibly paid in full in cash
or all Commitments and all other commitments by any Secured Party to the Borrower have not been terminated or all Letters of Credit
have not terminated or expired, then such amount shall be deemed to have been paid to such Grantor for the benefit of, and held
in trust for, the Administrative Agent (on behalf of the Secured Parties), and shall forthwith be paid to the Administrative Agent
to be credited and applied upon the Secured Obligations, whether matured or unmatured. Each Grantor acknowledges that it will receive
direct and indirect benefits from the financing arrangements contemplated by the First Lien Credit Agreement and that the waiver
set forth in this Section 2.8 is knowingly made in contemplation of such benefits.

 

SECTION 2.9.          Election
of Remedies. Except as otherwise provided in the First Lien Credit Agreement, if the Administrative Agent may, under applicable
law, proceed to realize its benefits under any of this Security Agreement or the other Loan Documents giving the Administrative
Agent a lien upon any Collateral, either by judicial foreclosure or by non-judicial sale or enforcement, the Administrative Agent
may, at its sole option, determine which of its remedies or rights it may pursue without affecting any of its rights and remedies
under this Security Agreement. If, in the exercise of any of its rights and remedies, the Administrative Agent shall forfeit any
of its rights or remedies, including its right to enter a deficiency judgment against any Grantor or any other Obligor or any other
Person, whether because of any applicable laws pertaining to “election of remedies” or the like, each Grantor hereby
consents to such action by the Administrative Agent and waives any claim based upon such action, even if such action by the Administrative
Agent shall result in a full or partial loss of any rights of subrogation that such Grantor might otherwise have had but for such
action by the Administrative Agent.

 

ARTICLE
III.

REPRESENTATIONS AND WARRANTIES

 

Each Grantor hereby represents
and warrants to the Administrative Agent and each other Secured Party as of the date hereof, as follows.

 

SECTION 3.1.          Government
Approval, Regulation, etc. Except for filings to perfect and maintain the perfection of the Liens arising pursuant to the Security
Documents, no authorization or approval or other action by, and no notice to or filing with, any Governmental Authority or other
Person (other than those that have been duly obtained or made and that are in full force and effect) is required (a) for the due
execution, delivery or performance by such Grantor of this Security Agreement or any Loan Document or Bank Product Agreement to
which it is a party, (b) for the grant by such Grantor of the security interest granted hereby, (c) for the perfection or maintenance
of the security interests hereunder including the first priority (subject to Permitted Liens) nature of such security interest
or the exercise by the Administrative Agent of its rights and remedies hereunder, or (d) for the exercise by the Administrative
Agent of the rights of control, possession, voting or other rights provided for in this Security Agreement, except (i) with respect
to any Pledged Shares or Pledged Interests, as may be required in connection with a disposition of such Pledged Shares or Pledged
Interests by laws affecting the offering and sale of securities generally, the remedies in respect of the Collateral pursuant to
this Security Agreement and (ii) any “change of control” or similar filings required by state licensing agencies.

 

    	 	- 10 -	EXXI Pledge and Security Agreement

     

    

 

SECTION 3.2.          Ownership,
No Liens, etc. Such Grantor is the legal and beneficial owner of, and has good and defensible title to (and has full right
and authority to pledge, grant and assign) the Collateral, free and clear of all Liens or options, except for any Lien (a) granted
pursuant to this Security Agreement in favor of the Administrative Agent, or (b) that is a Permitted Lien. No effective UCC financing
statement or other filing similar in effect covering all or any part of the Collateral is on file in any recording office, except
those filed in favor of the Administrative Agent relating to this Security Agreement or the Loan Documents, Permitted Liens or
as to which a duly authorized termination statement relating to such UCC financing statement or other instrument was delivered
to the Administrative Agent on or before the Effective Date. This Security Agreement creates a valid security interest in the Collateral,
securing the payment of the Secured Obligations, and, except for the proper filing of the applicable Filing Statements with the
Secretary of State of the State of Delaware, all filings and other actions necessary to perfect and protect such security interest
have been duly taken and such security interest shall be a first priority security interest.

 

SECTION 3.3.          As
to Capital Securities of the Subsidiaries, Investment Property.

 

(a)          With
respect to the Pledged Shares, all such Pledged Shares are duly authorized and validly issued, fully paid and non-assessable, and
represented by a certificate.

 

(b)          With
respect to the Pledged Interests, no such Pledged Interests (i) are dealt in or traded on securities exchanges or in securities
markets, (ii) expressly provide that such Pledged Interests are securities governed by Article 8 of the UCC, or (iii) are held
in a Securities Account, except, with respect to this clause (b), Pledged Interests (A) for which the Administrative Agent
is the registered owner or (B) with respect to which the Pledged Interests Issuer has agreed in an authenticated record with the
applicable Grantor and the Administrative Agent to comply with any instructions of the Administrative Agent without the consent
of such Grantor.

 

(c)          Such
Grantor delivered all Certificated Securities constituting Collateral held by such Grantor on or prior to the Effective Date to
the Administrative Agent, together with duly executed undated blank stock powers, or other equivalent instruments of transfer reasonably
acceptable to the Administrative Agent.

 

    	 	- 11 -	EXXI Pledge and Security Agreement

     

    

 

(d)          With
respect to Uncertificated Securities constituting Collateral owned by such Grantor, such Grantor has caused the Pledged Interests
Issuer or other issuer thereof either (i) to register the Administrative Agent as the registered owner of such security, or (ii)
to agree in an authenticated record with such Grantor and the Administrative Agent that such Pledged Interests Issuer or other
issuer will comply with instructions with respect to such security originated by the Administrative Agent without further consent
of such Grantor.

 

(e)          The
percentage of the issued and outstanding Pledged Shares and Pledged Interests of each Pledged Interests Issuer pledged by such
Grantor hereunder is as set forth on Schedule I. All of the Pledged Shares and Pledged Interests constitute one hundred
percent (100%) (or, in the case of Exergy XXI Insurance Limited, 65%) of such Grantor’s interest in the applicable Pledged
Interests Issuer and the percentage of the total membership, partnership and/or other equity interests in the Pledged Interests
Issuer indicated on Schedule I.

 

(f)          Such
Grantor has no outstanding rights, rights to subscribe, options, warrants or convertible securities outstanding or any other rights
outstanding whereby any Person would be entitled to acquire shares, member interests or units of any Pledged Interest Issuer.

 

(g)          In
the case of each Pledged Note, all of such Pledged Notes have been duly authorized, executed, endorsed, issued and delivered, and
are the legal, valid and binding obligation of the issuers thereof, and are not in default.

 

SECTION 3.4.          Each
Grantor’s Name, Location, etc.

 

(a)          (i)
the jurisdiction in which such Grantor is located for purposes of Sections 9-301 and 9-307 of the UCC is set forth in Item A-1
of Schedule II hereto (as such schedule may be amended or supplemented from time to time), (ii) the place of business of
such Grantor or, if such Grantor has more than one place of business, the chief executive office of such Grantor and the office
where such Grantor keeps its records concerning the Receivables, and all originals of all chattel paper which evidence Receivables,
is set forth in Item A-2 of Schedule II hereto (as such schedule may be amended or supplemented from time to time
with the consent of the Administrative Agent (not to be unreasonably withheld, conditioned or delayed)), and (iii) such Grantor’s
federal taxpayer identification number is set forth in Item A-3 of Schedule II hereto (as such schedule may be amended
or supplemented from time to time with the consent of the Administrative Agent (not to be unreasonably withheld, conditioned or
delayed)).

 

(b)          All
of the Equipment, Inventory and Goods of such Grantor are located at the places specified in Item B, Item C and Item
D, respectively, of Schedule II hereto (as such schedule may be amended or supplemented from time to time with the consent
of the Administrative Agent (not to be unreasonably withheld, conditioned or delayed)).

 

(c)          Such
Grantor does not have any trade names.

 

    	 	- 12 -	EXXI Pledge and Security Agreement

     

    

 

(d)          During
the period beginning on the date that is five years prior to the Effective Date, such Grantor has not been known by any legal name
different from the one set forth on the signature page hereto, nor has such Grantor been the subject of any merger or other corporate
reorganization, except as set forth in Item E of Schedule II hereto (as such schedule may be amended or supplemented
from time to time with the consent of the Administrative Agent (not to be unreasonably withheld, conditioned or delayed)).

 

(e)          [Reserved].

 

(f)          Such
Grantor does not maintain any Deposit Accounts, Securities Accounts or Commodity Accounts with any Person, in each case, except
as set forth on Item G of Schedule II (as such schedule may be amended or supplemented from time to time with the
consent of the Administrative Agent (not to be unreasonably withheld, conditioned or delayed)).

 

(g)          None
of the Receivables is evidenced by a promissory note or other instrument other than a promissory note or instrument that has been
delivered to the Administrative Agent (with appropriate endorsements) or that has a face amount less than $500,000.

 

(h)          Such
Grantor is not the beneficiary of any Letters of Credit, except as set forth on Item H of Schedule II (as such schedule
may be amended or supplemented from time to time) hereto and such Grantor has obtained the consent of each Issuer of any material
Letter of Credit to the assignment of the proceeds of the Letter of Credit to the Administrative Agent.

 

(i)          Such
Grantor does not have Commercial Tort Claims (i) in which a suit has been filed by the Grantor, and (ii) where the amount of damages
reasonably expected to be claimed exceeds $500,000, except as set forth on Item I of Schedule II (as such schedule
may be amended or supplemented from time to time with the consent of the Administrative Agent (not to be unreasonably withheld,
conditioned or delayed)).

 

(j)          As
of the Effective Date, the name set forth on the signature page attached hereto is the true and correct legal name (as defined
in the UCC) of such Grantor.

 

(k)          Such
Grantor has obtained a legal, valid and enforceable consent of each issuer of any Letter of Credit with a stated amount in excess
of $1,000,000 to the assignment of the Proceeds of such Letter of Credit to the Administrative Agent and has not consented to,
and is otherwise aware of, any Person (other than the Administrative Agent pursuant hereto) having control (within the meaning
of Section 9-104 of the UCC) over, or any other interest in any of such Grantor’s rights in respect thereof.

 

SECTION 3.5.          Possession
of Inventory, Control, etc. Such Grantor (a) has exclusive possession and control of the Equipment and Inventory, and (b) is
the sole entitlement holder of its Deposit Accounts, Securities Accounts and other bank accounts and no other Person (other than
the Administrative Agent pursuant to this Security Agreement or any other Person with respect to Permitted Liens) has “control”
or “possession” of, or any other interest in, any of its Accounts (other than those set forth on Item 7.1.9 of the
Disclosure Schedule to the First Lien Credit Agreement) or any other securities or property credited thereto except as permitted
pursuant to this Security Agreement.

 

    	 	- 13 -	EXXI Pledge and Security Agreement

     

    

 

SECTION 3.6.          Negotiable
Documents, Instruments and Chattel Paper. Such Grantor has, contemporaneously herewith, delivered to the Administrative Agent
possession of all originals of all Documents, Instruments, Promissory Notes, Pledged Notes and tangible Chattel Paper owned or
held by such Grantor (duly endorsed, in blank, if requested by the Administrative Agent).

 

SECTION 3.7.          Intellectual
Property Collateral. Such Grantor represents that except for any Patent Collateral, Trademark Collateral, and Copyright Collateral
specified in Item A, Item B and Item C, respectively, of Schedule III hereto, and any and Trade Secrets
Collateral, such Grantor owns and has no interests in any Intellectual Property Collateral as of the date hereof, other than the
Computer Hardware and Software Collateral. Such Grantor further represents and warrants that, with respect to all Intellectual
Property Collateral (a) such Intellectual Property Collateral is valid, subsisting, unexpired and enforceable and has not been
abandoned or adjudged invalid or unenforceable, in whole or in part except as could not reasonably be expected to have a Material
Adverse Effect, (b) such Grantor is the sole and exclusive owner of the entire and unencumbered right, title and interest in and
to such Intellectual Property Collateral and no claim has been made that the use of such Intellectual Property Collateral does
or may, conflict with, infringe, misappropriate, dilute, misuse or otherwise violate any of the rights of any third party, (c)
such Grantor has made all necessary filings and recordations to protect its interest in such material Intellectual Property Collateral,
including recordations of any of its interests in the Patent Collateral and Trademark Collateral in the United States Patent and
Trademark Office and in corresponding offices throughout the world, and its claims to the Copyright Collateral in the United States
Copyright Office and in corresponding offices throughout the world, and, to the extent necessary, has used proper statutory notice
in connection with its use of any material patent, Trademark and copyright in any of the Intellectual Property Collateral, (d)
such Grantor has taken all reasonable steps to safeguard its Trade Secrets and to its knowledge (i) none of the Trade Secrets of
such Grantor has been used, divulged, disclosed or appropriated for the benefit of any other Person other than such Grantor, (ii)
no employee, independent contractor or agent of such Grantor has misappropriated any Trade Secrets of any other Person in the course
of the performance of his or her duties as an employee, independent contractor or agent of such Grantor, and (iii) no employee,
independent contractor or agent of such Grantor is in default or breach of any term of any employment agreement, non-disclosure
agreement, assignment of inventions agreement or similar agreement or contract relating in any way to the protection, ownership,
development, use or transfer of such Grantor’s Intellectual Property Collateral, (e) to such Grantor’s knowledge, no
third party is infringing upon any material Intellectual Property owned or used by such Grantor in any material respect, or any
of its respective licensees, (f) no settlement or consents, covenants not to sue, nonassertion assurances, or releases have been
entered into by such Grantor or to which such Grantor is bound that adversely affects its rights to own or use any Intellectual
Property except as would not reasonably have a Material Adverse Effect, (g) such Grantor has not made a previous assignment, sale,
transfer or agreement constituting a present or future assignment, sale or transfer of any Intellectual Property for purposes of
granting a security interest or as Collateral that has not been terminated or released, (h) such Grantor uses adequate standards
of quality in the manufacture, distribution, and sale of all products sold and in the provision of all services rendered under
or in connection with any Trademarks and has taken all commercially reasonable action necessary to insure that any licensees of
any Trademarks owned by such Grantor use such adequate standards of quality, (i) the consummation of the transactions contemplated
by the First Lien Credit Agreement and this Security Agreement will not result in the termination or material impairment of any
material portion of the Intellectual Property Collateral, and (j) such Grantor owns directly or is entitled to use by license or
otherwise, any Patents, Trademarks, Trade Secrets, Copyrights, mask works, licenses, technology, know-how, processes and rights
with respect to any of the foregoing used in, necessary for the conduct of such Grantor’s business.

 

    	 	- 14 -	EXXI Pledge and Security Agreement

     

    

 

SECTION 3.8.          Best
Interests. It is in the best interests of each Grantor to execute this Security Agreement in as much as each Grantor will derive
substantial direct and indirect benefits from the Loans and other Credit Extensions made from time to time pursuant to the First
Lien Credit Agreement, and each Grantor agrees that the Secured Parties are relying on this representation in agreeing to make
such Loans and other Credit Extensions pursuant to the First Lien Credit Agreement.

 

SECTION 3.9.          Reaffirmation
of Representations and Warranties. All of the representations and warranties made by the Borrower or any other Obligor regarding
such Grantor or any of its Subsidiaries in the First Lien Credit Agreement or in any other Loan Document are true and correct in
all respects as if such representations and warranties were incorporated herein in their entirety and made by such Grantor.

 

ARTICLE
IV.

COVENANTS

 

Each Grantor covenants
and agrees that, until the Termination Date, it will perform, comply with and be bound by the obligations set forth below.

 

SECTION 4.1.          As
to Investment Property, etc.

 

(a)          Capital
Securities of Subsidiaries. No Grantor shall allow or permit any of its Subsidiaries (i) that is a corporation, business trust,
joint stock company or similar Person, to issue Uncertificated Securities, unless such Person promptly takes the actions set forth
in Section 4.1(b)(ii) with respect to any such Uncertificated Securities, (ii) that is a partnership or limited liability
company, to (A) issue Capital Securities that are to be dealt in or traded on securities exchanges or in securities markets, (B)
expressly provide in its Organic Documents that its Capital Securities are securities governed by Article 8 of the UCC, or (C)
place such Subsidiary’s Capital Securities in a Securities Account, unless such Person promptly takes the actions set forth
in Section 4.1(b)(ii) with respect to any such Capital Securities, and (iii) to issue Capital Securities in addition to
or in substitution for the Pledged Property or any other Capital Securities pledged hereunder, except for additional Capital Securities
issued to such Grantor; provided that (A) such Capital Securities are immediately pledged and delivered to the Administrative Agent,
and (B) such Grantor delivers a supplement to Schedule I to the Administrative Agent identifying such new Capital Securities
as Pledged Property, in each case pursuant to the terms of this Security Agreement. No Grantor shall permit any of its Subsidiaries
to issue any warrants, options, contracts or other commitments or other securities that are convertible to any of the foregoing
or that entitle any Person to purchase any of the foregoing, and except for this Security Agreement or any other Loan Document
shall not, and shall not permit any of its Subsidiaries to, enter into any agreement creating any restriction or condition upon
the transfer, voting or control of any Pledged Property.

 

    	 	- 15 -	EXXI Pledge and Security Agreement

     

    

 

(b)          Investment
Property (other than Certificated Securities). With respect to (i) any Deposit Accounts, Securities Accounts, Commodity Accounts,
Commodity Contracts or Security Entitlements constituting Investment Property owned or held by any Grantor (other than any of such
Accounts listed on Item 7.1.9 of the Disclosure Schedule to the First Lien Credit Agreement), such Grantor will, upon the Administrative
Agent’s request, cause the intermediary maintaining such Investment Property to execute a Control Agreement relating to such
Investment Property pursuant to which such intermediary agrees to comply with the Administrative Agent’s instructions with
respect to such Investment Property without further consent by such Grantor, or (ii) any Uncertificated Securities (other than
Uncertificated Securities credited to a Securities Account) constituting Investment Property owned or held by such Grantor, such
Grantor will cause the Pledged Interests Issuer or other issuer of such securities to either (A) register the Administrative Agent
as the registered owner thereof on the books and records of the issuer, or (B) execute a Control Agreement relating to such Investment
Property pursuant to which the Pledged Interests Issuer or other issuer agrees to comply with the Administrative Agent’s
instructions with respect to such Uncertificated Securities without further consent by such Grantor.

 

(c)          Certificated
Securities (Stock Powers). Each Grantor agrees that all Pledged Shares (and all other certificated shares of Capital Securities
constituting Collateral) delivered by such Grantor pursuant to this Security Agreement will be accompanied by duly endorsed undated
blank stock powers, or other equivalent instruments of transfer acceptable to the Administrative Agent. Each Grantor will, from
time to time upon the request of the Administrative Agent, promptly deliver to the Administrative Agent such stock powers, instruments
and similar documents, satisfactory in form and substance to the Administrative Agent, with respect to the Collateral as the Administrative
Agent may reasonably request and will, from time to time upon the request of the Administrative Agent after the occurrence of any
Default, promptly transfer any Pledged Shares, Pledged Interests or other shares of Capital Securities constituting Collateral
into the name of any nominee designated by the Administrative Agent.

 

(d)          Continuous
Pledge. Each Grantor will (subject to the terms of the First Lien Credit Agreement) deliver to the Administrative Agent and
at all times keep pledged to the Administrative Agent pursuant hereto, on a first-priority, perfected basis all Pledged Property,
Investment Property, all Payment Intangibles to the extent they are evidenced by a Document, Instrument, Promissory Note or Chattel
Paper, and, from and after an Event of Default while it is continuing, all interest and principal with respect to such Payment
Intangibles, and all Proceeds and rights from time to time received by or distributable to such Grantor in respect of any of the
foregoing Collateral. Each Grantor agrees that it will, promptly (but in any event no later than seven Business Days) following
receipt thereof, deliver to the Administrative Agent possession of all originals of Pledged Interests, Pledged Shares, Pledged
Notes and any other Pledged Property, negotiable Documents, Instruments, Promissory Notes and Chattel Paper that it acquires following
the Effective Date and shall deliver to the Administrative Agent a supplement to Schedule I identifying any such new Pledged
Interests, Pledged Shares, Pledged Notes or other Pledged Property.

 

    	 	- 16 -	EXXI Pledge and Security Agreement

     

    

 

(e)          Voting
Rights, Dividends, etc. Each Grantor agrees:

 

(i)          that
promptly upon receipt of notice of the occurrence and continuance of an Event of Default from the Administrative Agent and without
any request therefor by the Administrative Agent, so long as such Event of Default shall continue, to deliver (properly endorsed
where required hereby or requested by the Administrative Agent) to the Administrative Agent all Distributions with respect to Investment
Property, all interest principal and other cash payments on Payment Intangibles, the Pledged Property and all Proceeds of the Pledged
Property or any other Collateral, in case thereafter received by such Grantor, all of which shall be held by the Administrative
Agent as additional Collateral;

 

(ii)         that,
with respect to Pledged Property or any other Collateral consisting of general partner interests or limited liability company interests,
promptly upon receipt of notice of the occurrence and continuance of an Event of Default from the Administrative Agent and of the
Administrative Agent’s intention to exercise its voting power under Section 4.1(e)(iii) such Grantor shall modify
the applicable Organic Documents to admit the Administrative Agent as a general partner or member, as applicable; and

 

(iii)        if
an Event of Default shall have occurred and be continuing and the Administrative Agent has notified such Grantor of the Administrative
Agent’s intention to exercise its voting power under this Section 4.1(e)(iii),

 

(A)         the
Administrative Agent may exercise (to the exclusion of such Grantor) the voting power and all other incidental rights of ownership
with respect to any Pledged Shares, Investment Property or other Capital Securities constituting Collateral EACH GRANTOR HEREBY
GRANTS THE ADMINISTRATIVE AGENT AN IRREVOCABLE PROXY (WHICH IRREVOCABLE PROXY SHALL CONTINUE IN EFFECT UNTIL THE TERMINATION DATE)
EXERCISABLE UNDER SUCH CIRCUMSTANCES, TO VOTE THE PLEDGED SHARES, PLEDGED INTERESTS, INVESTMENT PROPERTY AND SUCH OTHER COLLATERAL;
AND

 

    	 	- 17 -	EXXI Pledge and Security Agreement

     

    

 

(B)         promptly
to deliver to the Administrative Agent such additional proxies and other documents as may be necessary to allow the Administrative
Agent to exercise such voting power.

 

All Distributions, interest, principal, cash
payments, Payment Intangibles and Proceeds that may at any time and from time to time be held by any Grantor but which such Grantor
is then obligated to deliver to the Administrative Agent, shall, until delivery to the Administrative Agent, be held by such Grantor
separate and apart from its other property in trust for the Administrative Agent. The Administrative Agent agrees that unless an
Event of Default shall have occurred and be continuing and the Administrative Agent shall have given the notice referred to in
Section 4.1(e), each Grantor shall have the exclusive voting power, and is granted a proxy, with respect to any Capital
Securities (including any of the Pledged Shares) constituting Collateral. Administrative Agent shall, upon the written request
of any Grantor, promptly deliver such proxies and other documents, if any, as shall be reasonably requested by such Grantor which
are necessary to allow such Grantor to exercise that voting power with respect to any such Capital Securities (including any of
the Pledged Shares) constituting Collateral; provided, however, that no vote shall be cast, or consent, waiver, or
ratification given, or action taken by such Grantor that would violate any provision of the First Lien Credit Agreement or any
other Loan Document (including this Security Agreement).

 

SECTION 4.2.          Organic
Documents, Change of Name, etc. No Grantor will change its state of incorporation, formation or organization or its name, identity,
organizational identification number or corporate structure unless such Grantor shall have (a) given the Administrative Agent at
least fifteen (15) days’ prior written notice of such change, (b) obtained the consent of the requisite Secured Parties,
if such consent is so required by the Loan Documents, and (c) taken all actions necessary or as requested by the Administrative
Agent to ensure that the Liens on the Collateral granted in favor of the Administrative Agent for the benefit of the Lender Parties
remain perfected, first-priority Liens.

 

SECTION 4.3.          As
to Accounts.

 

(a)          Each
Grantor shall have the right to collect all Accounts so long as (i) no Event of Default shall have occurred and be continuing and
(ii) the Administrative Agent has not delivered the notice referred to in clause (b)(ii) below.

 

(b)          Upon
(i) the occurrence and continuance of an Event of Default and (ii) the delivery of notice by the Administrative Agent to the applicable
Grantor, all Proceeds of Collateral received by such Grantor shall be delivered in kind to the Administrative Agent for deposit
in a Deposit Account of such Grantor (A) maintained with the Administrative Agent or (B) maintained at a depositary bank other
than the Administrative Agent to which such Grantor, the Administrative Agent and the depositary bank have entered into a Control
Agreement in form and substance acceptable to the Administrative Agent in its sole discretion providing that the depositary bank
will comply with the instructions originated by the Administrative Agent directing disposition of the funds in the account without
further consent by such Grantor (any such Deposit Accounts, together with any other Accounts pursuant to which any portion of the
Collateral is deposited with the Administrative Agent, a “Collateral Account,” and collectively, the “Collateral
Accounts”), and such Grantor shall not commingle any such Proceeds, and shall hold separate and apart from all other
property, all such Proceeds in express trust for the benefit of the Administrative Agent until delivery thereof is made to the
Administrative Agent.

 

    	 	- 18 -	EXXI Pledge and Security Agreement

     

    

 

(c)          Following
the delivery of notice pursuant to clause (b)(ii), the Administrative Agent shall have the right to apply any amount in
the Collateral Account to the payment of any Secured Obligations which are due and payable or in accordance with the Loan Documents.

 

(d)          With
respect to each of the Collateral Accounts, it is hereby confirmed and agreed that (i) deposits in such Collateral Account are
subject to a security interest as contemplated hereby, (ii) such Collateral Account shall be under the control of the Administrative
Agent and (iii) the Administrative Agent shall have the sole right of withdrawal over such Collateral Account once the Administrative
Agent has delivered the notice referred to in clause (b)(ii) above.

 

(e)          Following
the occurrence and during the continuance of an Event of Default, at the request of the Administrative Agent or the Required Lenders,
such Grantor will maintain all of its Deposit Accounts only with the Administrative Agent or with any depositary institution that
has entered into a Control Agreement in favor of the Administrative Agent.

 

SECTION 4.4.          As
to Grantors’ Use of Collateral.

 

(a)          Subject
to clause (b), such Grantor (i) may in the ordinary course of its business, at its own expense, sell, lease or furnish under
the contracts of service any of the Inventory normally held by such Grantor for such purpose, and use and consume, in the ordinary
course of its business, any raw materials, work in process or materials normally held by such Grantor for such purpose, (ii) shall,
at its own expense, endeavor to collect, as and when due, all amounts due with respect to any of the Collateral, including the
taking of such action with respect to such collection as the Administrative Agent may request following the occurrence and during
the continuance of an Event of Default or, in the absence of such request, as such Grantor may deem advisable, and (iii) may grant,
in the ordinary course of business, to any party obligated on any of the Collateral, any rebate, refund or allowance to which such
party may be lawfully entitled, and may accept, in connection therewith, the return of Goods, the sale or lease of which shall
have given rise to such Collateral.

 

(b)          At
any time following the occurrence and during the continuance of an Event of Default, whether before or after the maturity of any
of the Secured Obligations, the Administrative Agent may (i) revoke any or all of the rights of such Grantor set forth in clause
(a), (ii) notify any parties obligated on any of the Collateral to make payment to the Administrative Agent of any amounts
due or to become due thereunder, and (iii) enforce collection of any of the Collateral by suit or otherwise and surrender, release,
or exchange all or any part thereof, or compromise or extend or renew for any period (whether or not longer than the original period)
any indebtedness thereunder or evidenced thereby.

 

    	 	- 19 -	EXXI Pledge and Security Agreement

     

    

 

(c)          Upon
request of the Administrative Agent following the occurrence and during the continuance of an Event of Default, each Grantor will,
at its own expense, notify any parties obligated on any of the Collateral to make payment to the Administrative Agent of any amounts
due or to become due thereunder.

 

(d)          At
any time following the occurrence and during the continuation of an Event of Default, the Administrative Agent may endorse, in
the name of any Grantor, any item, howsoever received by the Administrative Agent, representing any payment on or other Proceeds
of any of the Collateral.

 

SECTION 4.5.          As
to Equipment and Inventory and Goods. Each Grantor hereby agrees that it shall keep all of the Equipment and Inventory (other
than Inventory sold in the ordinary course of business) and Goods located at the places therefore specified in Section 3.7(b)
or, upon ten (10) days’ prior written notice to the Administrative Agent, at such other places in a jurisdiction within the
United States of America where all representations and warranties set forth in Article III shall be true and correct, and
all action required pursuant to the second sentence of Section 4.12 shall have been taken with respect to the Equipment
and Inventory and Goods.

 

SECTION 4.6.          As
to Intellectual Property Collateral. Each Grantor covenants and agrees to comply with the following provisions as such provisions
relate to any Intellectual Property Collateral material to the operations or business of such Grantor:

 

(a)          such
Grantor will not (i) do or fail to perform any act whereby any of the Patent Collateral may lapse or become abandoned or dedicated
to the public or unenforceable, (ii) permit any of its licensees to (A) fail to continue to use any of the Trademark Collateral
in order to maintain all of the Trademark Collateral in full force free from any claim of abandonment for non-use, (B) fail to
maintain as in the past the quality of products and services offered under all of the Trademark Collateral, (C) fail to employ
all of the Trademark Collateral registered with any federal or state or foreign authority with an appropriate notice of such registration,
(D) adopt or use any other Trademark which is confusingly similar or a colorable imitation of any of the Trademark Collateral,
(E) use any of the Trademark Collateral registered with any federal, state or foreign authority except for the uses for which registration
or application for registration of all of the Trademark Collateral has been made, or (F) do or permit any act or knowingly omit
to do any act whereby any of the Trademark Collateral may lapse or become invalid or unenforceable, or (iii) do or permit any act
or knowingly omit to do any act whereby any of the Copyright Collateral or any of the Trade Secrets Collateral may lapse or become
invalid or unenforceable or placed in the public domain except upon expiration of the end of an unrenewable term of a registration
thereof, unless, in the case of any of the foregoing requirements in clauses (i), (ii) and (iii), such Grantor
shall either (x) reasonably and in good faith determine that any of such Intellectual Property Collateral is of negligible economic
value to such Grantor, or (y) the loss of the Intellectual Property Collateral would not be reasonably likely to have a Material
Adverse Effect on the business;

 

    	 	- 20 -	EXXI Pledge and Security Agreement

     

    

 

(b)          such
Grantor shall promptly notify the Administrative Agent if it knows, or has reason to know, that any application or registration
relating to any material item of the Intellectual Property Collateral may become abandoned or dedicated to the public or placed
in the public domain or invalid or unenforceable, or of any adverse determination or development (including the institution of,
or any such determination or development in, any proceeding in the United States Patent and Trademark Office, the United States
Copyright Office or any foreign counterpart thereof or any court) regarding such Grantor’s ownership of any of the Intellectual
Property Collateral, its right to register the same or to keep and maintain and enforce the same;

 

(c)          in
no event will such Grantor or any of its agents, employees, designees or licensees file an application for the registration of
any Intellectual Property Collateral with the United States Patent and Trademark Office, the United States Copyright Office or
any similar office or agency in any other country or any political subdivision thereof, unless it promptly informs the Administrative
Agent, and upon request of the Administrative Agent (subject to the terms of the First Lien Credit Agreement), executes and delivers
all agreements, instruments and documents as the Administrative Agent may reasonably request to evidence the Administrative Agent’s
security interest in such Intellectual Property Collateral;

 

(d)          such
Grantor will take all necessary steps, including in any proceeding before the United States Patent and Trademark Office, the United
States Copyright Office or (subject to the terms of the First Lien Credit Agreement) any similar office or agency in any other
country or any political subdivision thereof, to maintain and pursue any application (and to obtain the relevant registration)
filed with respect to, and to maintain any registration of, the Intellectual Property Collateral, including the filing of applications
for renewal, affidavits of use, affidavits of incontestability and opposition, interference and cancellation proceedings and the
payment of fees and taxes (except to the extent that dedication, abandonment or invalidation is permitted under the foregoing clause
(a) or (b));

 

(e)          following
the obtaining of an interest in any material Intellectual Property by such Grantor shall deliver a supplement to Schedule III
identifying such new Intellectual Property; and

 

(f)          following
the obtaining of an interest in any material Intellectual Property by such Grantor or, following the occurrence and during the
continuance of an Event of Default, upon the request of the Administrative Agent, such Grantor shall deliver all agreements, instruments
and documents the Administrative Agent may reasonably request to evidence the Administrative Agent’s security interest in
such Intellectual Property Collateral and as may otherwise be required to acknowledge or register or perfect the Administrative
Agent’s interest in any part of such item of Intellectual Property Collateral unless such Grantor shall determine in good
faith (with the consent of the Administrative Agent) that any Intellectual Property Collateral is of negligible economic value
to such Grantor.

 

    	 	- 21 -	EXXI Pledge and Security Agreement

     

    

 

SECTION 4.7.          As
to Letter-of-Credit Rights.

 

(a)          Each
Grantor, by granting a security interest in its Letter-of-Credit Rights to the Administrative Agent, intends to (and hereby does)
collaterally assign to the Administrative Agent its rights (including its contingent rights) to the Proceeds of all Letter-of-Credit
Rights of which it is or hereafter becomes a beneficiary or assignee. Promptly following the date on which any Grantor obtains
any Letter of Credit Rights after the date hereof, such Grantor shall (i) deliver a supplement to Schedule II identifying
such new Letter-of-Credit Right and (ii) with respect to each Letter of Credit having a stated amount in excess of $500,000, cause
the issuer of such Letter of Credit and each nominated person (if any) with respect thereto to consent to such assignment of the
Proceeds thereof in a consent agreement in form and substance reasonably satisfactory to the Administrative Agent and deliver written
evidence of such consent to the Administrative Agent.

 

(b)          Upon
the occurrence and during the continuation of an Event of Default, each Grantor will, promptly upon request by the Administrative
Agent, (i) notify (and each Grantor hereby authorizes the Administrative Agent to notify) the issuer and each nominated person
with respect to each of the Letters of Credit that the Proceeds thereof have been assigned to the Administrative Agent hereunder
and any payments due or to become due in respect thereof are to be made directly to the Administrative Agent and (ii) arrange for
the Administrative Agent to become the transferee beneficiary Letter of Credit.

 

SECTION 4.8.          As
to Commercial Tort Claims. Each Grantor covenants and agrees that, until the Termination Date, with respect to any Commercial
Tort Claim in excess of $500,000 individually or in the aggregate hereafter arising, it shall deliver to the Administrative Agent
a supplement to Schedule II in form and substance reasonably satisfactory to the Administrative Agent, identifying such
new Commercial Tort Claims.

 

SECTION 4.9.          Electronic
Chattel Paper and Transferable Records. If any Grantor at any time holds or acquires an interest in any electronic chattel
paper or any “transferable record,” as that term is defined in Section 201 of the U.S. Federal Electronic Signatures
in Global and National Commerce Act, or in Section 16 of the U.S. Uniform Electronic Transactions Act as in effect in any relevant
jurisdiction, with a value in excess of $500,000, such Grantor shall promptly notify the Administrative Agent thereof and, at the
request of the Administrative Agent, shall take such action as the Administrative Agent may request to vest in the Administrative
Agent control under Section 9-105 of the UCC of such electronic chattel paper or control under Section 201 of the Federal Electronic
Signatures in Global and National Commerce Act or, as the case may be, Section 16 of the Uniform Electronic Transactions Act, as
so in effect in such jurisdiction, of such transferable record. The Administrative Agent agrees with the Grantors that the Administrative
Agent will arrange, pursuant to procedures reasonably satisfactory to the Administrative Agent and so long as such procedures will
not result in the Administrative Agent’s loss of control, for such Grantor to make alterations to the electronic chattel
paper or transferable record permitted under Section 9-105 of the UCC or, as the case may be, Section 201 of the U.S. Federal Electronic
Signatures in Global and National Commerce Act or Section 16 of the U.S. Uniform Electronic Transactions Act for a party in control
to allow without loss of control, unless an Event of Default has occurred and is continuing or would occur after taking into account
any action by such Grantor with respect to such electronic chattel paper or transferable record.

 

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SECTION 4.10.         Transfers
and Other Liens. No Grantor shall: (a) sell, assign (by operation of law or otherwise) or otherwise dispose of any of the Collateral,
except Inventory in the ordinary course of business or as permitted by the First Lien Credit Agreement, or (b) create or suffer
to exist any Lien or other charge or encumbrance upon or with respect to any of the Collateral to secure Indebtedness of any Person
or entity, except for the security interest created by this Security Agreement and the other Loan Documents and except for Liens
and other charges or encumbrances specifically permitted by the First Lien Credit Agreement.

 

SECTION 4.11.         Taxes.
Each Grantor agrees to pay promptly when due all Taxes imposed upon such Grantor or any of its direct or indirect Subsidiaries
or upon their property except to the extent being diligently contested in good faith by appropriate proceedings and for which adequate
reserves in accordance with GAAP have been set aside on the books of such Grantor or such Subsidiaries, as applicable.

 

SECTION 4.12.         Further
Assurances, etc. Each Grantor shall warrant and defend the right and title herein granted unto the Administrative Agent in
and to the Collateral (and all right, title and interest represented by the Collateral) against the claims and demands of all Persons
whomsoever. Each Grantor agrees that, from time to time at its own expense, it will promptly execute and deliver all further instruments
and documents, and take all further action, that may be necessary or that the Administrative Agent may reasonably request, in order
to perfect, preserve and protect any security interest granted or purported to be granted hereby or to enable the Administrative
Agent to exercise and enforce its rights and remedies hereunder with respect to any Collateral. Each Grantor agrees that, upon
the acquisition after the date hereof by such Grantor of any Collateral, with respect to which the security interest granted hereunder
is not perfected automatically upon such acquisition, to take such actions with respect to such Collateral or any part thereof
as required by the Loan Documents. Without limiting the generality of the foregoing, each Grantor will:

 

(a)          from
time to time upon the request of the Administrative Agent, promptly deliver to the Administrative Agent such stock powers, instruments
and similar documents, reasonably satisfactory in form and substance to the Administrative Agent, with respect to such Collateral
as the Administrative Agent may reasonably request and will, from time to time upon the request of the Administrative Agent, after
the occurrence and during the continuance of any Event of Default, promptly transfer any securities constituting Collateral into
the name of any nominee designated by the Administrative Agent; if any Collateral shall be evidenced by an Instrument, negotiable
Document, Promissory Note or tangible Chattel Paper, deliver and pledge to the Administrative Agent hereunder such Instrument,
negotiable Document, Promissory Note, Pledged Note or tangible Chattel Paper duly endorsed and accompanied by duly executed instruments
of transfer or assignment, all in form and substance reasonably satisfactory to the Administrative Agent;

 

(b)          file
(and hereby authorize the Administrative Agent to file) such Filing Statements or continuation statements, or amendments thereto,
and such other instruments or notices (including any assignment of claim form under or pursuant to the federal assignment of claims
statute, 31 U.S.C. § 3726, any successor or amended version thereof or any regulation promulgated under or pursuant to any
version thereof), as may be necessary or that the Administrative Agent may request in order to perfect and preserve the security
interests and other rights granted or purported to be granted to the Administrative Agent hereby. The authorization contained in
this Section 4.12 shall be irrevocable and continuing until the Termination Date;

 

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(c)          deliver
to the Administrative Agent and at all times keep pledged to the Administrative Agent pursuant hereto, on a first-priority, perfected
basis, at the request of the Administrative Agent, all Investment Property constituting Collateral (except for Permitted Liens),
and, from and after an Event of Default and during the continuation thereof, all Distributions with respect thereto, and all interest
and principal with respect to Promissory Notes, and all Proceeds and rights from time to time received by or distributable to such
Grantor in respect of any of the foregoing Collateral;

 

(d)          not
take or omit to take any action the taking or the omission of which would result in any impairment or alteration of any obligation
of the maker of any Payment Intangible or other Instrument constituting Collateral, except as provided in Section 4.4;

 

(e)          not
create any tangible Chattel Paper without placing a legend on such tangible Chattel Paper reasonably acceptable to the Administrative
Agent indicating that the Administrative Agent has a security interest in such Chattel Paper;

 

(f)          furnish
to the Administrative Agent, from time to time at the Administrative Agent’s request, statements and schedules further identifying
and describing the Collateral and such other reports in connection with the Collateral as the Administrative Agent may reasonably
request, all in reasonable detail; and

 

(g)          do
all things reasonably requested by the Administrative Agent in accordance with this Security Agreement in order to enable the Administrative
Agent to have and maintain control over the Collateral consisting of Investment Property and/or Deposit Accounts (except for those
that are listed in Item 7.1.9 of the Disclosure Schedule to the First Lien Credit Agreement), Letter-of-Credit-Rights and Electronic
Chattel Paper.

 

With respect to the foregoing and the grant
of the security interest hereunder, each Grantor hereby authorizes the Administrative Agent to file one or more financing or continuation
statements, any amendments thereto, and other similar documents necessary or desirable in the opinion of the Administrative Agent
to perfect or maintain the perfection of the Administrative Agent’s or any Secured Party’s security interest in the
Collateral or any portion thereof, in each of the foregoing cases, without the signature and without further authorization of such
Grantor. Each Grantor agrees that a carbon, photographic or other reproduction of this Security Agreement or any UCC financing
statement covering the Collateral or any part thereof shall be sufficient as a UCC financing statement where permitted by law.
Each Grantor hereby authorizes the Administrative Agent to file financing statements describing as the collateral covered thereby
“all of the debtor’s personal property or assets” or words to that effect, notwithstanding that such wording
may be broader in scope than the Collateral described in this Security Agreement.

 

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SECTION 4.13.         Performance
of Covenants in Loan Documents. Each Grantor will perform, comply with, observe and fulfill, and will cause each of its Subsidiaries
to perform, comply with, observe and fulfill, each of the covenants, agreements and obligations contained in the First Lien Credit
Agreement and the other Loan Documents pertaining to or otherwise applicable to such Grantor or any of its Subsidiaries.

 

ARTICLE
V.

THE ADMINISTRATIVE AGENT

 

SECTION 5.1.          Administrative
Agent Appointed Attorney-in-Fact. Each Grantor hereby irrevocably appoints the Administrative Agent its attorney-in-fact, with
full authority in the place and stead of such Grantor and in the name of such Grantor or otherwise, from time to time in the Administrative
Agent’s discretion, following the occurrence and during the continuance of an Event of Default, to take any action and to
execute any instrument which the Administrative Agent may deem necessary or advisable to accomplish the purposes of this Security
Agreement, including (a) to ask, demand, collect, sue for, recover, compromise, receive and give acquittance and receipts for moneys
due and to become due under or in respect of any of the Collateral, (b) to receive, endorse, and collect any drafts or other Instruments,
Documents and Chattel Paper, in connection with clause (a) above, (c) to file any claims or take any action or institute
any proceedings which the Administrative Agent may deem necessary or desirable for the collection of any of the Collateral or otherwise
to enforce the rights of the Administrative Agent with respect to any of the Collateral, and (d) to perform the affirmative obligations
of such Grantor hereunder. EACH GRANTOR HEREBY ACKNOWLEDGES, CONSENTS AND AGREES THAT THE POWER OF ATTORNEY GRANTED PURSUANT
TO THIS SECTION 5.1 IS IRREVOCABLE AND COUPLED WITH AN INTEREST AND SHALL BE EFFECTIVE UNTIL THE TERMINATION DATE.

 

SECTION 5.2.          Administrative
Agent May Perform. If any Grantor fails to perform any agreement contained herein, the Administrative Agent may itself perform,
or cause performance of, such agreement, and the expenses of the Administrative Agent incurred in connection therewith shall be
payable by such Grantor pursuant to Section 6.5 hereof and Section 10.3 of the First Lien Credit Agreement and the Administrative
Agent may from time to time take any other action which the Administrative Agent reasonably deems necessary for the maintenance,
preservation or protection of any of the Collateral or of its security interest therein.

 

SECTION 5.3.          Administrative
Agent Has No Duty. The powers conferred on the Administrative Agent hereunder are solely to protect its interest (on behalf
of the Secured Parties) in the Collateral and shall not impose any duty on it to exercise any such powers. Except for reasonable
care of any Collateral in its possession and the accounting for moneys actually received by it hereunder, the Administrative Agent
shall have no duty as to any Collateral or responsibility for (a) ascertaining or taking action with respect to calls, conversions,
exchanges, maturities, tenders or other matters relative to any Investment Property and any other Pledged Property, whether or
not the Administrative Agent has or is deemed to have knowledge of such matters, or (b) taking any necessary steps to preserve
rights against prior parties or any other rights pertaining to any Collateral.

 

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SECTION 5.4.          Reasonable
Care. The Administrative Agent is required to exercise reasonable care in the custody and preservation of any of the Collateral
in its possession; provided, that the Administrative Agent shall be deemed to have exercised reasonable care in the custody
and preservation of any of the Collateral (a) if such Collateral is accorded treatment substantially equal to that which the Administrative
Agent accords its own personal property, or (b) if the Administrative Agent takes such action for that purpose as any Grantor reasonably
requests in writing at times other than upon the occurrence and during the continuance of an Event of Default; provided,
further, that failure of the Administrative Agent to comply with any such request at any time shall not in itself be deemed
a failure to exercise reasonable care.

 

ARTICLE
VI.

REMEDIES

 

SECTION 6.1.          Certain
Remedies. If any Event of Default shall have occurred and be continuing:

 

(a)          The
Administrative Agent may exercise in respect of the Collateral, in addition to other rights and remedies provided for herein or
otherwise available to it, all the rights and remedies of a secured party on default under the UCC (whether or not the UCC applies
to the affected Collateral) and also may (i) take possession of any Collateral not already in its possession without demand and
without legal process, (ii) require any Grantor to, and each Grantor hereby agrees that it will, at its expense and upon request
of the Administrative Agent forthwith, assemble all or part of the Collateral as directed by the Administrative Agent and make
it available to the Administrative Agent at a place to be designated by the Administrative Agent that is reasonably convenient
to both parties, (iii) enter onto the property where any Collateral is located and take possession thereof without demand and without
legal process, (iv) without notice except as specified below, lease, license, sell or otherwise dispose of the Collateral or any
part thereof in one or more parcels at public or private sale, at any of the Administrative Agent’s offices or elsewhere,
for cash, on credit or for future delivery, and upon such other terms as the Administrative Agent may deem commercially reasonable.
Each Grantor agrees that, to the extent notice of sale shall be required by law, at least ten days’ prior notice to such
Grantor of the time and place of any public sale or the time of any private sale is to be made shall constitute reasonable notification;
provided, however, that with respect to Collateral that is (x) perishable or threatens to decline speedily in value,
or (y) is of a type customarily sold on a recognized market (including but not limited to, Investment Property), no notice of sale
or disposition need be given. For purposes of this Article VI, notice of any intended sale or disposition of any Collateral
may be given by first-class mail, hand-delivery (through a delivery service or otherwise), facsimile or email, and shall be deemed
to have been “sent” upon deposit in the U.S. Mails with adequate postage properly affixed, upon delivery to an express
delivery service or upon electronic submission through telephonic or internet services, as applicable. The Administrative Agent
shall not be obligated to make any sale of Collateral regardless of notice of sale having been given. The Administrative Agent
may adjourn any public or private sale from time to time by announcement at the time and place fixed therefor, and such sale may,
without further notice, be made at the time and place to which it was so adjourned.

 

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(b)          Each
Grantor agrees and acknowledges that a commercially reasonable disposition of Inventory, Equipment, Goods, Computer Hardware and
Software Collateral, or Intellectual Property may be by lease or license of, in addition to the sale of, such Collateral. Each
Grantor further agrees and acknowledges that the following shall be deemed a reasonable commercial disposition: (i) a disposition
made in the usual manner on any recognized market, (ii) a disposition at the price current in any recognized market at the time
of disposition, and (iii) a disposition in conformity with reasonable commercial practices among dealers in the type of property
subject to the disposition.

 

(c)          All
cash Proceeds received by the Administrative Agent in respect of any sale of, collection from, or other realization upon, all or
any part of the Collateral shall be applied by the Administrative Agent against, all or any part of the Obligations as set forth
in Section 4.7 of the First Lien Credit Agreement. The Administrative Agent shall not be obligated to apply or pay over for application
noncash proceeds of collection or enforcement unless (i) the failure to do so would be commercially unreasonable, and (ii) the
affected party has provided the Administrative Agent with a written demand to apply or pay over such noncash proceeds on such basis.

 

(d)          The
Administrative Agent may do any or all of the following: (i) transfer all or any part of the Collateral into the name of the Administrative
Agent or its nominee, with or without disclosing that such Collateral is subject to the Lien hereunder, (ii) notify the parties
obligated on any of the Collateral to make payment to the Administrative Agent of any amount due or to become due thereunder, (iii)
withdraw, or cause or direct the withdrawal, of all funds with respect to the Collateral Account, (iv) enforce collection of any
of the Collateral by suit or otherwise, and surrender, release or exchange all or any part thereof, or compromise or extend or
renew for any period (whether or not longer than the original period) any obligations of any nature of any party with respect thereto,
(v) endorse any checks, drafts, or other writings in any Grantor’s name to allow collection of the Collateral, (vi) take
control of any Proceeds of the Collateral, or (vii) execute (in the name, place and stead of any Grantor) endorsements, assignments,
stock powers and other instruments of conveyance or transfer with respect to all or any of the Collateral.

 

SECTION 6.2.          Securities
Laws. If the Administrative Agent shall determine to exercise its right to sell all or any of the Collateral that are Capital
Securities pursuant to Section 6.1, each Grantor agrees that, upon request of the Administrative Agent, such Grantor will,
at its own expense:

 

(a)          execute
and deliver, and cause (or, with respect to any issuer which is not a Subsidiary of such Grantor, use its reasonable efforts to
cause) each Pledged Interests Issuer or other issuer of the Collateral contemplated to be sold and the directors and officers thereof
to execute and deliver, all such instruments and documents, and do or cause to be done all such other acts and things, as may be
necessary or, in the reasonable opinion of the Administrative Agent, advisable to register such Collateral under the provisions
of the Securities Act of 1933, as from time to time amended (the “Securities Act”), and cause the registration
statement relating thereto to become effective and to remain effective for such period as prospectuses are required by law to be
furnished, and to make all amendments and supplements thereto and to the related prospectus which, in the reasonable opinion of
the Administrative Agent, are necessary or advisable, all in conformity with the requirements of the Securities Act and the rules
and regulations of the SEC applicable thereto;

 

    	 	- 27 -	EXXI Pledge and Security Agreement

     

    

 

(b)          use
its reasonable efforts to exempt the Collateral under the state securities or “Blue Sky” laws and to obtain all necessary
Governmental Approvals for the sale of the Collateral, as requested by the Administrative Agent;

 

(c)          cause
(or, with respect to any issuer that is not a Subsidiary of such Grantor, use its reasonable efforts to cause) each such Pledged
Interests Issuer or other issuer to make available to its security holders, as soon as practicable, an earnings statement that
will satisfy the provisions of Section 11(a) of the Securities Act; and

 

(d)          do
or cause to be done all such other acts and things as may be reasonably necessary to make such sale of the Collateral or any part
thereof valid and binding and in compliance with applicable law.

 

Each Grantor acknowledges the impossibility
of ascertaining the amount of damages that would be suffered by the Administrative Agent or the Secured Parties by reason of the
failure by such Grantor to perform any of the covenants contained in this Section and consequently agrees that, if such Grantor
shall fail to perform any of such covenants, it shall pay, as liquidated damages and not as a penalty, an amount equal to the value
(as reasonably determined by the Administrative Agent in good faith) of such Collateral on the date the Administrative Agent shall
demand compliance with this Section 6.2; provided that in no event shall the Grantors be obligated in respect hereof
for an amount that exceeds the sum of Total Exposure Amount plus all interest, fees and expenses owing in respect thereof.

 

SECTION 6.3.          Compliance
with Restrictions. Each Grantor agrees that in any sale of any of the Collateral whenever an Event of Default shall have occurred
and be continuing, the Administrative Agent is hereby authorized to comply with any limitation or restriction in connection with
such sale as it may be advised by counsel is necessary in order to avoid any violation of applicable law (including compliance
with such procedures as may restrict the number of prospective bidders and purchasers, require that such prospective bidders and
purchasers have certain qualifications, and restrict such prospective bidders and purchasers to Persons who will represent and
agree that they are purchasing for their own account for investment and not with a view to the distribution or resale of such Collateral),
or in order to obtain any required approval of the sale or of the purchaser by any Governmental Authority or official, and each
Grantor further agrees that such compliance shall not result in such sale being considered or deemed not to have been made in a
commercially reasonable manner, nor shall the Administrative Agent be liable nor accountable to such Grantor for any discount allowed
by the reason of the fact that such Collateral is sold in compliance with any such limitation or restriction.

 

SECTION 6.4.          Protection
of Collateral. The Administrative Agent may from time to time, at its option, perform any act which any Grantor fails to perform
after being requested in writing so to perform (it being understood that no such request need be given after the occurrence and
during the continuance of an Event of Default) and the Administrative Agent may from time to time take any other action which the
Administrative Agent deems reasonably necessary for the maintenance, preservation or protection of any of the Collateral or of
its security interest therein.

 

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SECTION 6.5.          Indemnity
and Expenses.

 

(a)          Without
limiting the generality of the provisions of Section 10.4 of the First Lien Credit Agreement, each Grantor hereby indemnifies and
holds harmless the Administrative Agent, each Secured Party and each of their respective officers, directors, employees and agents
(the “Indemnified Parties”) from and against any and all claims, losses and liabilities arising out of or resulting
from this Security Agreement or any other Loan Document (including, without limitation, enforcement of this Security Agreement),
except claims, losses or liabilities resulting from any Indemnified Party’s gross negligence, willful misconduct or unlawful
acts; PROVIDED, HOWEVER, THAT IT IS THE INTENTION OF THE PARTIES HERETO THAT EACH INDEMNIFIED PARTY BE INDEMNIFIED IN THE CASE
OF ITS OWN NEGLIGENCE (OTHER THAN GROSS NEGLIGENCE), REGARDLESS OF WHETHER SUCH NEGLIGENCE IS SOLE OR CONTRIBUTORY, ACTIVE OR PASSIVE,
IMPUTED, JOINT OR TECHNICAL. If and to the extent that the foregoing undertaking may be unenforceable for any reason, each
Grantor hereby agrees to make the maximum contribution to the payment and satisfaction of each of the foregoing which is permissible
under applicable law.

 

(b)          Each
Grantor will upon demand pay to the Administrative Agent and any local counsel the amount of any and all reasonable expenses, including
the reasonable fees and disbursements of its counsel and of any experts and agents, which the Administrative Agent and any local
counsel may incur in connection herewith, including without limitation in connection with (i) the administration of this Security
Agreement, (ii) the custody, preservation, use or operation of, or the sale of, collection from, or other realization upon, any
of the Collateral, (iii) the exercise or enforcement of any of the rights of the Administrative Agent and any local counsel or
any of the Secured Parties hereunder, or (iv) the failure by any Grantor to perform or observe any of the provisions hereof.

 

SECTION 6.6.          Warranties.
The Administrative Agent may sell the Collateral without giving any warranties or representations as to the Collateral. The Administrative
Agent may disclaim any warranties of title or the like. Each Grantor agrees that this procedure will not be considered to adversely
affect the commercial reasonableness of any sale of the Collateral.

 

ARTICLE
VII.

MISCELLANEOUS PROVISIONS

 

SECTION 7.1.          Loan
Document. This Security Agreement is a Loan Document executed pursuant to the First Lien Credit Agreement and shall (unless
otherwise expressly indicated herein) be construed, administered and applied in accordance with the terms and provisions thereof,
including Article 10 thereof.

 

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SECTION 7.2.          Binding
on Successors, Transferees and Assigns; Assignment. This Security Agreement shall remain in full force and effect until the
Termination Date has occurred, shall be binding upon each Grantor and its successors, transferees and assigns and shall inure to
the benefit of and be enforceable by each Secured Party and its successors, transferees and assigns; provided, that no Grantor
shall (unless otherwise permitted under the terms of the First Lien Credit Agreement or this Security Agreement) assign any of
its obligations hereunder without, subject to the First Lien Credit Agreement, the prior written consent of the Required Lenders.

 

SECTION 7.3.          Amendments,
etc. No amendment to or waiver of any provision of this Security Agreement, nor consent to any departure by any Grantor from
its obligations under this Security Agreement, shall in any event be effective unless the same shall be in writing and signed by
the Administrative Agent (on behalf of the Lenders or the Required Lenders, as the case may be, pursuant to Section 10.1 of the
First Lien Credit Agreement) and each Grantor and then such waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given.

 

SECTION 7.4.          Notices.
Except as otherwise provided in this Security Agreement, all notices and other communications provided for hereunder shall be in
writing or by facsimile and addressed, delivered or transmitted to the appropriate party at the address or facsimile number of
such party specified on the signature pages of this Security Agreement or at such other address or facsimile number as may be designated
by such party in a notice to the other party. Except as otherwise provided in this Security Agreement, any notice or other communication,
if mailed and properly addressed with postage prepaid or if properly addressed and sent by pre-paid courier service, shall be deemed
given when received; any such notice or other communication, if transmitted by facsimile, shall be deemed given when transmitted
and electronically confirmed.

 

SECTION 7.5.          Release
of Liens. Upon (a) the Disposition of Collateral in accordance with the First Lien Credit Agreement or (b) the occurrence of
the Termination Date, the security interests granted herein shall automatically terminate with respect to (i) such Collateral (in
the case of clause (a)) or (ii) all Collateral (in the case of clause (b)). Upon any such Disposition or termination,
the Administrative Agent will, at the Grantors’ sole expense, deliver to the Grantors, without any representations, warranties
or recourse of any kind whatsoever, all Collateral held by the Administrative Agent hereunder, and execute and deliver to the Grantors
such documents as the Grantors shall reasonably request to evidence such termination.

 

SECTION 7.6.          No
Waiver; Remedies. In addition to, and not in limitation of Section 2.7, no failure on the part of any Secured Party
to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of any right hereunder preclude any other or further exercise thereof or the exercise of any other right. The remedies
herein provided are cumulative and not exclusive of any remedies provided by law.

 

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SECTION 7.7.          Headings.
The various headings of this Security Agreement are inserted for convenience only and shall not affect the meaning or interpretation
of this Security Agreement or any provisions thereof.

 

SECTION 7.8.          Severability.
Any provision of this Security Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such provision and
such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions
of this Security Agreement or affecting the validity or enforceability of such provision in any other jurisdiction.

 

SECTION 7.9.          Governing
Law, Entire Agreement, etc. THIS SECURITY AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL
LAWS OF THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE
OF NEW YORK), EXCEPT TO THE EXTENT THAT THE PERFECTION, EFFECT OF PERFECTION OR NONPERFECTION, AND PRIORITY OF THE SECURITY INTEREST
HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN
THE STATE OF NEW YORK.

 

THIS WRITTEN AGREEMENT
AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.

 

THERE ARE NO UNWRITTEN
ORAL AGREEMENTS BETWEEN THE PARTIES.

 

SECTION 7.10.         Counterparts.
This Security Agreement may be executed by the parties hereto in several counterparts, each of which shall be deemed to be an original
and all of which shall constitute together but one and the same agreement. Delivery of an executed counterpart of a signature page
to this Security Agreement by facsimile or other electronic transmission shall be effective as delivery of a manually executed
counterpart of this Security Agreement.

 

SECTION 7.11.         Additional
Grantors; Additional Pledged Securities. Each Subsidiary of the Borrower that is required to become a party to this Security
Agreement pursuant to Section 7.1.8 of the First Lien Credit Agreement shall become a Grantor for all purposes of this Agreement
upon execution and delivery by such Subsidiary of an Assumption Agreement substantially in the form of Annex I hereto. Each
Grantor that is required to pledge additional Equity Interests pursuant to the First Lien Credit Agreement shall execute and deliver
to the Administrative Agent a Supplement.

 

(Signatures Begin on Following Page)

 

    	 	- 31 -	EXXI Pledge and Security Agreement

     

    

 

IN WITNESS WHEREOF, each
of the parties hereto has caused this Security Agreement to be duly executed and delivered by its Authorized Officer as of the
date first above written.

 

	 	GRANTORS
	 	 
	 	ENERGY XXI GULF COAST, INC.
	 	 	 	 
	 	By:	/s/ Hugh Menown
	 	 	Name:	Hugh Menown
	 	 	Title:	Executive Vice President,
	 	 	 	Chief Accounting Officer
	 	 	 	 
	 	ENERGY XXI GOM, LLC
	 	 	 	 
	 	By:	/s/ Rick Fox
	 	 	Name:	Rick Fox
	 	 	Title:	Chief Financial Officer & Treasurer
	 	 	 	 
	 	ENERGY XXI TEXAS ONSHORE, LLC
	 	 	 	 
	 	By:	/s/ Rick Fox
	 	 	Name:	Rick Fox
	 	 	Title:	Chief Financial Officer & Treasurer
	 	 	 	 
	 	ENERGY XXI ONSHORE, LLC
	 	 	 	 
	 	By:	/s/ Rick Fox
	 	 	Name:	Rick Fox
	 	 	Title:	Chief Financial Officer & Treasurer
	 	 	 	 
	 	ENERGY XXI PIPELINE, LLC
	 	 	 	 
	 	By:	/s/ Rick Fox
	 	 	Name:	Rick Fox
	 	 	Title:	Chief Financial Officer & Treasurer

 

    	 	S-1 	Signature Page to EXXI Pledge
 and Security Agreement

     

    

 

	 	ENERGY XXI LEASEHOLD, LLC
	 	 	 	 
	 	By:	/s/ Rick Fox
	 	 	Name:	Rick Fox
	 	 	Title:	Chief Financial Officer & Treasurer
	 	 	 	 
	 	ENERGY XXI PIPELINE II, LLC
	 	 	 	 
	 	By:	/s/ Rick Fox
	 	 	Name:	Rick Fox
	 	 	Title:	Chief Financial Officer & Treasurer
	 	 	 	 
	 	MS ONSHORE, LLC
	 	 	 	 
	 	By:	/s/ Rick Fox
	 	 	Name:	Rick Fox
	 	 	Title:	Chief Financial Officer & Treasurer
	 	 	 	 
	 	M21K, LLC
	 	 	 	 
	 	By:	/s/ Rick Fox
	 	 	Name:	Rick Fox
	 	 	Title:	Chief Financial Officer & Treasurer
	 	 	 	 
	 	SOILEAU CATERING, LLC
	 	 	 	 
	 	By:	/s/ Rick Fox
	 	 	Name:	Rick Fox
	 	 	Title:	Chief Financial Officer & Treasurer

 

    	 	S-2 	Signature Page to EXXI Pledge
 and Security Agreement

     

    

 

	 	EPL OIL & GAS, INC.
	 	 	 	 
	 	By:	/s/ Rick Fox
	 	 	Name:	Rick Fox
	 	 	Title:	Chief Financial Officer & Treasurer
	 	 	 	 
	 	ANGLO-SUISSE OFFSHORE PIPELINE PARTNERS, LLC
	 	 	 	 
	 	By:	/s/ Rick Fox
	 	 	Name:	Rick Fox
	 	 	Title:	Chief Financial Officer & Treasurer
	 	 	 	 
	 	DELAWARE EPL OF TEXAS, LLC
	 	 	 	 
	 	By:	/s/ Rick Fox
	 	 	Name:	Rick Fox
	 	 	Title:	Chief Financial Officer & Treasurer
	 	 	 	 
	 	ENERGY PARTNERS LTD., LLC
	 	 	 	 
	 	By:	/s/ Rick Fox
	 	 	Name:	Rick Fox
	 	 	Title:	Chief Financial Officer & Treasurer
	 	 	 	 
	 	EPL OF LOUISIANA, L.L.C.
	 	 	 	 
	 	By:	/s/ Rick Fox
	 	 	Name:	Rick Fox
	 	 	Title:	Chief Financial Officer & Treasurer

 

    	 	S-3 	Signature Page to EXXI Pledge
 and Security Agreement

     

    

 

	 	EPL PIONEER HOUSTON, INC.
	 	 	 	 
	 	By:	/s/ Rick Fox
	 	 	Name:	Rick Fox
	 	 	Title:	Chief Financial Officer & Treasurer
	 	 	 	 
	 	EPL PIPELINE, L.L.C.
	 	 	 	 
	 	By:	/s/ Rick Fox
	 	 	Name:	Rick Fox
	 	 	Title:	Chief Financial Officer & Treasurer
	 	 	 	 
	 	NIGHTHAWK, L.L.C.
	 	 	 	 
	 	By:	/s/ Rick Fox
	 	 	Name:	Rick Fox
	 	 	Title:	Chief Financial Officer & Treasurer
	 	 	 	 
	 	ENERGY XXI OFFSHORE SERVICES, INC.
	 	 	 	 
	 	By:	/s/ Rick Fox
	 	 	Name:	Rick Fox
	 	 	Title:	Chief Financial Officer & Treasurer
	 	 	 	 
	 	ENERGY XXI NATURAL GAS HOLDINGS, INC.
	 	 	 	 
	 	By:	/s/ Rick Fox
	 	 	Name:	Rick Fox
	 	 	Title:	Chief Financial Officer & Treasurer

 

    	 	S-4 	Signature Page to EXXI Pledge
 and Security Agreement

     

    

 

	 	NATURAL GAS ACQUISITION COMPANY I, LLC
	 	 	 	 
	 	By:	/s/ Rick Fox
	 	 	Name:	Rick Fox
	 	 	Title:	Chief Financial Officer & Treasurer
	 	 	 	 
	 	ENERGY XXI SERVICES, LLC
	 	 	 	 
	 	By:	/s/ Rick Fox
	 	 	Name:	Rick Fox
	 	 	Title:	Chief Financial Officer & Treasurer

 

	 	Notice Address for each Grantor:
	 	 
	 	1021 Main (One City Centre), Suite 2626
	 	Houston, Texas 77002
	 	Attention: Bruce Busmire
	 	Telephone: (713) 351-3033
	 	Facsimile: (713) 351-3333

 

    	 	S-5 	Signature Page to EXXI Pledge
 and Security Agreement

     

    

 

	 	ADMINISTRATIVE AGENT:
	 	 	 	 
	 	WELLS FARGO BANK, N.A.
	 	 	 	 
	 	By:	/s/ Catherine K. Cook
	 	 	Name:	Catherine K. Cook
	 	 	Title:	Director

 

	 	Notice Address:
	 	Wells Fargo Bank, N.A.
	 	1525 West W.T. Harris Blvd.
	 	MAC D1109-019
	 	Charlotte, NC 28262
	 	Attention: Agency Services
	 	Telephone: (704) 590-2760
	 	Facsimile: (704) 590-2790
	 	 
	 	With a copy to:
	 	 
	 	Wells Fargo Bank, N.A.
	 	1000 Louisiana Street, 9th Floor
	 	Houston, TX 77002
	 	Attention: Nina Milligan
	 	Telephone: (713) 319-1838
	 	Facsimile: (713) 319-1925

 

    	 	S-6 	Signature Page to EXXI Pledge
 and Security Agreement

     

    

 

SCHEDULE I

to Security Agreement

 

Energy XXI Gulf Coast,
Inc.

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	Common 
Stock	 	 	 	 
	Pledged Interests Issuer 

(corporate)	 	Cert. #	 	#
                                         of
 Shares
	 	 	Authorized
 Shares
	 	 	Outstanding
 Shares
	 	 	%
                                         of
 Shares
 Pledged
	 
	EPL Oil & Gas, Inc.	 	ZQ00000668	 	 	1,000	 	 	 	1,000	 	 	 	1,000	 	 	 	100	%
	Energy XXI Offshore Services, Inc.	 	N/A	 	 	1,000,000	 	 	 	1,000,000	 	 	 	1,000,000	 	 	 	100	%
	Energy XXI Natural Gas Holdings, Inc.	 	N/A	 	 	1,000,000	 	 	 	1,000,000	 	 	 	1,000,000	 	 	 	100	%
	Energy XXI Insurance Limited	 	N/A	 	 	120,000	 	 	 	120,000	 	 	 	120,000	 	 	 	65	%

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests

    Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	1)  Energy XXI GOM, LLC	 	 	100	%	 	Membership Interest
	2)  MS Onshore, LLC	 	 	100	%	 	Membership Interest
	3)  Energy XXI Services, LLC	 	 	100	%	 	Membership Interest

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	N/A	 	 		 	 	 		 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

N/A

 

    
	 	Schedule I-1	 Schedule I to EXXI Pledge
and Security Agreement

     

    

 

SCHEDULE I

to Security Agreement

 

Energy XXI GOM, LLC

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	 	Common

 Stock	 	 	 	 
	Pledged Interests Issuer

 (corporate)	 	Cert. #	 	 	# of

    Shares	 	 	Authorized 

    Shares	 	 	Outstanding 

    Shares	 	 	% of

    Shares

     Pledged	 
	N/A	 	 		 	 	 		 	 	 		 	 	 		 	 	 		 

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests

    Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	1)  Energy XXI Onshore, LLC	 	 	100	%	 	Membership Interest
	2)  Energy XXI Texas Onshore, LLC	 	 	100	%	 	Membership Interest
	3)  Energy XXI Pipeline, LLC	 	 	100	%	 	Membership Interest
	4)  Energy XXI Pipeline II, LLC	 	 	100	%	 	Membership Interest
	5)  Energy XXI Leasehold, LLC	 	 	100	%	 	Membership Interest
	6)  M21K, LLC	 	 	100	%	 	Membership Interest
	7)  Soileau Catering, LLC	 	 	100	%	 	Membership Interest

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	N/A	 	 		 	 	 		 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

N/A

 

    
	 	Schedule I-2	 Schedule I to EXXI Pledge
and Security Agreement

     

    

 

SCHEDULE I

to Security Agreement

 

Energy XXI Leasehold,
LLC

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	 	Common

 Stock	 	 	 	 
	Pledged Interests Issuer

 (corporate)	 	Cert. #	 	 	# of

    Shares	 	 	Authorized 

    Shares	 	 	Outstanding 

    Shares	 	 	% of

    Shares

     Pledged	 
	N/A	 	 		 	 	 		 	 	 		 	 	 		 	 	 		 

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests

    Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	N/A	 	 			 	

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	N/A	 	 		 	 	 		 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

N/A

 

    
	 	Schedule I-3	 Schedule I to EXXI Pledge
and Security Agreement

     

    

 

SCHEDULE I

to Security Agreement

 

Energy XXI Onshore, LLC

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	 	Common

 Stock	 	 	 	 
	Pledged Interests Issuer

 (corporate)	 	Cert. #	 	 	# of

    Shares	 	 	Authorized 

    Shares	 	 	Outstanding 

    Shares	 	 	% of

    Shares

     Pledged	 
	N/A	 	 		 	 	 		 	 	 		 	 	 		 	 	 		 

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests

    Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	N/A	 	 			 	

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	N/A	 	 		 	 	 		 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

N/A

 

    
	 	Schedule I-4	 Schedule I to EXXI Pledge
and Security Agreement

     

    

 

SCHEDULE I

to Security Agreement

 

Energy XXI Pipeline, LLC

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	 	Common

 Stock	 	 	 	 
	Pledged Interests Issuer 

(corporate)	 	Cert. #	 	 	# of

    Shares	 	 	Authorized 

    Shares	 	 	Outstanding 

    Shares	 	 	% of

    Shares

     Pledged	 
	N/A	 	 		 	 	 		 	 	 		 	 	 		 	 	 		 

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests

    Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	N/A	 	 			 	

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	N/A	 	 		 	 	 		 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

N/A

 

    
	 	Schedule I-5	 Schedule I to EXXI Pledge
and Security Agreement

     

    

 

SCHEDULE I

to Security Agreement

 

Energy XXI Pipeline II,
LLC

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	 	Common

 Stock	 	 	 	 
	Pledged Interests Issuer

 (corporate)	 	Cert. #	 	 	# of

    Shares	 	 	Authorized 

    Shares	 	 	Outstanding 

    Shares	 	 	% of

    Shares

     Pledged	 
	N/A	 	 		 	 	 		 	 	 		 	 	 		 	 	 		 

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests

    Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	N/A	 	 			 	

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	N/A	 	 		 	 	 		 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

N/A

 

    
	 	Schedule I-6	 Schedule I to EXXI Pledge
and Security Agreement

     

    

 

SCHEDULE I

to Security Agreement

 

Energy XXI Texas Onshore,
LLC

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	 	Common

 Stock	 	 	 	 
	Pledged Interests Issuer

 (corporate)	 	Cert. #	 	 	# of

    Shares	 	 	Authorized 

    Shares	 	 	Outstanding 

    Shares	 	 	% of

    Shares

     Pledged	 
	N/A	 	 		 	 	 		 	 	 		 	 	 		 	 	 		 

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests

    Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	N/A	 	 			 	

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	N/A	 	 		 	 	 		 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

N/A

 

    
	 	Schedule I-7	 Schedule I to EXXI Pledge
and Security Agreement

     

    

 

SCHEDULE I

to Security Agreement

 

MS Onshore, LLC

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	 	Common

 Stock	 	 	 	 
	Pledged Interests Issuer

 (corporate)	 	Cert. #	 	 	# of

    Shares	 	 	Authorized 

    Shares	 	 	Outstanding 

    Shares	 	 	% of

    Shares

     Pledged	 
	N/A	 	 		 	 	 		 	 	 		 	 	 		 	 	 		 

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests
    

Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	N/A	 	 			 	

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	N/A	 	 		 	 	 		 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

N/A

 

    
	 	Schedule I-8	 Schedule I to EXXI Pledge
and Security Agreement

     

    

 

SCHEDULE I

to Security Agreement

 

M21K, LLC

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	 	Common

 Stock	 	 	 	 
	Pledged Interests Issuer 

(corporate)	 	Cert. #	 	 	# of

    Shares	 	 	Authorized 

    Shares	 	 	Outstanding 

    Shares	 	 	% of

    Shares

     Pledged	 
	N/A	 	 		 	 	 		 	 	 		 	 	 		 	 	 		 

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests

    Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	N/A	 	 			 	

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	N/A	 	 		 	 	 		 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

N/A

 

    
	 	Schedule I-9	 Schedule I to EXXI Pledge
and Security Agreement

     

    

 

SCHEDULE I

to Security Agreement

 

Soileau Catering, LLC

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	 	Common

 Stock	 	 	 	 
	Pledged Interests Issuer

 (corporate)	 	Cert. #	 	 	# of

    Shares	 	 	Authorized 

    Shares	 	 	Outstanding 

    Shares	 	 	% of

    Shares

     Pledged	 
	N/A	 	 		 	 	 		 	 	 		 	 	 		 	 	 		 

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests

    Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	N/A	 	 			 	

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	N/A	 	 		 	 	 		 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

N/A

 

    
	 	Schedule I-10	 Schedule I to EXXI Pledge
and Security Agreement

     

    

 

SCHEDULE I

to Security Agreement

 

EPL Oil & Gas, Inc.

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	Common

 Stock	 	 	 	 
	Pledged Interests Issuer

 (corporate)	 	Cert. #	 	# of

 Shares	 	 	Authorized

 Shares	 	 	Outstanding

 Shares	 	 	% of

 Shares

 Pledged	 
	EPL Pioneer Houston, Inc.	 	6	 	 	1,000	 	 	 	1,000	 	 	 	1,000	 	 	 	100	%

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	1)  Anglo-Suisse Offshore Pipeline Partners, LLC	 	 	100	%	 	Membership Interest
	2)  Delaware EPL of Texas, LLC	 	 	100	%	 	Membership Interest
	3)  Energy Partners Ltd., LLC	 	 	100	%	 	Membership Interest
	4)  EPL of Louisiana, L.L.C.	 	 	100	%	 	Membership Interest
	5)  EPL Pipeline, L.L.C.	 	 	100	%	 	Membership Interest
	6)  Nighthawk, L.L.C.	 	 	100	%	 	Membership Interest

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	N/A	 	 		 	 	 		 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

N/A

 

    
	 	Schedule I-11	 Schedule I to EXXI Pledge
and Security Agreement

     

    

 

SCHEDULE I

to Security Agreement

 

Anglo-Suisse Offshore
Pipeline Partners, LLC

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	Common

 Stock	 	 	 	 
	Pledged Interests Issuer

 (corporate)	 	Cert. #	 	# of

 Shares	 	 	Authorized

 Shares	 	 	Outstanding

 Shares	 	 	% of

 Shares

 Pledged	 
	N/A	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests
    

Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	N/A	 	 			 	

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	N/A	 	 		 	 	 		 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

N/A

 

    
	 	Schedule I-12	 Schedule I to EXXI Pledge
and Security Agreement

     

    

 

SCHEDULE I

to Security Agreement

 

Delaware EPL of Texas,
LLC

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	Common

 Stock	 	 	 	 
	Pledged Interests Issuer

 (corporate)	 	Cert. #	 	# of

 Shares	 	 	Authorized

 Shares	 	 	Outstanding

 Shares	 	 	% of

 Shares

 Pledged	 
	N/A	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests

    Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	N/A	 	 			 	

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	N/A	 	 		 	 	 		 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

N/A

 

    
	 	Schedule I-13	 Schedule I to EXXI Pledge
and Security Agreement

     

    

  

SCHEDULE I

to Security Agreement

 

Energy Partners Ltd.,
LLC

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	Common

 Stock	 	 	 	 
	Pledged Interests Issuer

 (corporate)	 	Cert. #	 	# of

 Shares	 	 	Authorized

 Shares	 	 	Outstanding

 Shares	 	 	% of

 Shares

 Pledged	 
	N/A	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests

    Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	N/A	 	 			 	

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	N/A	 	 		 	 	 		 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

N/A

 

    
	 	Schedule I-14	 Schedule I to EXXI Pledge
and Security Agreement

     

    

 

SCHEDULE I

to Security Agreement

 

EPL of Louisiana, L.L.C.

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	Common

 Stock	 	 	 	 
	Pledged Interests Issuer

 (corporate)	 	Cert. #	 	# of

 Shares	 	 	Authorized

 Shares	 	 	Outstanding

 Shares	 	 	% of

 Shares

 Pledged	 
	N/A	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests

    Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	N/A	 	 			 	

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	N/A	 	 		 	 	 		 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

N/A

 

    
	 	Schedule I-15	 Schedule I to EXXI Pledge
and Security Agreement

     

    

  

SCHEDULE I

to Security Agreement

 

EPL Pioneer Houston, Inc.

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	Common

 Stock	 	 	 	 
	Pledged Interests Issuer

 (corporate)	 	Cert. #	 	# of

 Shares	 	 	Authorized

 Shares	 	 	Outstanding

 Shares	 	 	% of

 Shares

 Pledged	 
	N/A	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests

    Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	N/A	 	 			 	

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	N/A	 	 		 	 	 		 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

N/A

 

    
	 	Schedule I-16	 Schedule I to EXXI Pledge
and Security Agreement

     

    

 

SCHEDULE I

to Security Agreement

 

EPL Pipeline, L.L.C.

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	Common

 Stock	 	 	 	 
	Pledged Interests Issuer

 (corporate)	 	Cert. #	 	# of

 Shares	 	 	Authorized

 Shares	 	 	Outstanding

 Shares	 	 	% of

 Shares

 Pledged	 
	N/A	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests
    

Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	N/A	 	 			 	

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	N/A	 	 		 	 	 		 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

N/A

 

    
	 	Schedule I-17	 Schedule I to EXXI Pledge
and Security Agreement

     

    

 

SCHEDULE I

to Security Agreement

 

Nighthawk, L.L.C.

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	Common

 Stock	 	 	 	 
	Pledged Interests Issuer

 (corporate)	 	Cert. #	 	# of

 Shares	 	 	Authorized

 Shares	 	 	Outstanding

 Shares	 	 	% of

 Shares

 Pledged	 
	N/A	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests

    Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	N/A	 	 			 	

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	N/A	 	 		 	 	 		 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

N/A

 

    
	 	Schedule I-18	 Schedule I to EXXI Pledge
and Security Agreement

     

    

 

SCHEDULE I

to Security Agreement

 

Energy XXI Offshore Services,
Inc.

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	Common

 Stock	 	 	 	 
	Pledged Interests Issuer

 (corporate)	 	Cert. #	 	# of

 Shares	 	 	Authorized

 Shares	 	 	Outstanding

 Shares	 	 	% of

 Shares

 Pledged	 
	N/A	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests
    

Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	N/A	 	 			 	

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	N/A	 	 		 	 	 		 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

N/A

 

    
	 	Schedule I-19	 Schedule I to EXXI Pledge
and Security Agreement

     

    

 

SCHEDULE I

to Security Agreement

 

Energy XXI Natural Gas
Holdings, Inc.

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	Common

 Stock	 	 	 	 
	Pledged Interests Issuer

 (corporate)	 	Cert. #	 	# of

 Shares	 	 	Authorized

 Shares	 	 	Outstanding

 Shares	 	 	% of

 Shares

 Pledged	 
	N/A	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests

 Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	1)  Natural Gas Acquisition Company I, LLC	 	 	100	%	 	Membership Interest
	2)  Energy XXI M21K, LLC	 	 	20	%	 	Membership Interest

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	N/A	 	 		 	 	 		 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

N/A

 

    
	 	Schedule I-20	 Schedule I to EXXI Pledge
and Security Agreement

     

    

  

SCHEDULE I

to Security Agreement

 

Energy XXI Services, LLC

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	Common

 Stock	 	 	 	 
	Pledged Interests Issuer (corporate)	 	Cert. #	 	# of

    Shares	 	 	Authorized 

    Shares	 	 	Outstanding 

    Shares	 	 	% of

    Shares 

    Pledged	 
	Energy XXI Holdings, Inc.	 	N/A	 	 	100,000	 	 	 	100,000	 	 	 	100,000	 	 	 	100	%

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests

 Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	1)  Energy XXI GIGS Services, LLC	 	 	100	%	 	Membership Interest

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	N/A	 	 		 	 	 		 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

N/A

 

    
	 	Schedule I-21	 Schedule I to EXXI Pledge
and Security Agreement

     

    

 

SCHEDULE II

to Security Agreement

 

		Item A-1.	Location of each Grantor for purposes of UCC.

 

	 	Delaware:	Energy XXI Gulf Coast, Inc. (“EXXI”)
	 	 	Energy XXI GOM, LLC (“EXXI GOM”)
	 	 	Energy XXI Leasehold, LLC (“EXXI Leasehold”)
	 	 	Energy XXI Onshore, LLC (“EXXI Onshore”)
	 	 	Energy XXI Pipeline, LLC (“EXXI Pipeline”)
	 	 	Energy XXI Pipeline II, LLC (“EXXI Pipeline II”)
	 	 	Energy XXI Texas Onshore, LLC (“EXXI Texas”)
	 	 	MS Onshore, LLC (“MS Onshore”)
	 	 	M21K, LLC (“M21K”)
	 	 	Soileau Catering, LLC (“Soileau”)
	 	 	EPL Oil & Gas, Inc. (“EPL”)
	 	 	Anglo-Suisse Offshore Pipeline Partners, LLC (“Anglo-Suisse”)
	 	 	Delaware EPL of Texas, LLC (“Delaware EPL”)
	 	 	Energy Partners Ltd., LLC (“Energy Partners”)
	 	 	EPL Pipeline, L.L.C.  (“EPL Pipeline”)
	 	 	Energy XXI Offshore Services, Inc. (“Offshore Services”)
	 	 	Energy XXI Natural Gas Holdings, Inc. (“Natural Gas Holdings”)
	 	 	Natural Gas Acquisition Company I, LLC (“Natural Gas Acquisition”)
	 	 	Energy XXI Services, LLC (“EXXI Services”)
	 	 	 
	 	Texas:	EPL Pioneer Houston, Inc. (“EPL Pioneer”)
	 	 	 
	 	Louisiana:	EPL of Louisiana, L.L.C. (“EPL Louisiana”)
	 	Nighthawk, L.L.C.	(“Nighthawk”)

 

		Item A-2.	Grantor’s place of business or principal office.

 

1021 Main Street, Suite 2626

Houston, TX 77002

 

		Item A-3.	Taxpayer ID number.

 

	 	EXXI:	20-4278595
	 	EXXI GOM:	56-2140027
	 	EXXI Leasehold:	45-3948121
	 	EXXI Onshore:	20-0650308
	 	EXXI Pipeline:	27-4165863
	 	EXXI Pipeline II:	45-3938238
	 	EXXI Texas:	20-0650294
	 	MS Onshore:	37-1708573
	 	M21K:	90-0793978
	 	Soileau:	47-4972767

 

    
	 	Schedule II-1	 Schedule II to EXXI Pledge
and Security Agreement

     

    

 

	 	EPL:	72-1409562
	 	Anglo-Suisse:	72-1409562
	 	Delaware EPL:	72-1409562
	 	Energy Partners:	72-1409562
	 	EPL Pipeline:	72-1471048
	 	Offshore Services:	47-2054711
	 	Natural Gas Holdings:	45-3137517
	 	Natural Gas Acquisition:	90-0800956
	 	EXXI Services:	20-4583999
	 	EPL Pioneer:	75-2129749
	 	EPL Louisiana:	72-1409562
	 	Nighthawk:	72-1409562

 

		Item B.	Equipment.

 

	 	EXXI:	Texas
	 	EXXI GOM:	Texas and Louisiana
	 	EXXI Leasehold:	Texas and Louisiana
	 	EXXI Onshore:	Louisiana
	 	EXXI Pipeline:	Louisiana
	 	EXXI Pipeline II:	Louisiana
	 	EXXI Texas:	Texas
	 	MS Onshore:	Texas and Mississippi
	 	M21K:	Texas and Louisiana
	 	Soileau:	Texas and Louisiana
	 	EPL:	Texas and Louisiana
	 	Anglo-Suisse:	Louisiana and Texas
	 	Delaware EPL:	Texas
	 	Energy Partners:	N/A
	 	EPL Pipeline:	Louisiana
	 	Offshore Services:	N/A
	 	Natural Gas Holdings:	Texas and Louisiana
	 	Natural Gas Acquisition	N/A
	 	EXXI Services:	Texas, Louisiana and Mississippi
	 	EPL Pioneer:	Texas
	 	EPL Louisiana:	Louisiana
	 	Nighthawk:	N/A

 

SCHEDULE II

to Security Agreement

		Item C.	Inventory.

 

	 	EXXI:	Texas
	 	EXXI GOM:	Texas and Louisiana
	 	EXXI Leasehold:	Texas and Louisiana
	 	EXXI Onshore:	Louisiana
	 	EXXI Pipeline:	Louisiana

 

    
	 	Schedule II-2	 Schedule II to EXXI Pledge
and Security Agreement

     

    

 

	 	EXXI Pipeline II:	Louisiana
	 	EXXI Texas:	Texas
	 	MS Onshore:	Texas and Mississippi
	 	M21K:	Texas and Louisiana
	 	Soileau:	Texas and Louisiana
	 	EPL:	Texas and Louisiana
	 	Anglo-Suisse:	Louisiana and Texas
	 	Delaware EPL:	Texas
	 	Energy Partners:	N/A
	 	EPL Pipeline:	Louisiana
	 	Offshore Services:	N/A
	 	Natural Gas Holdings:	Texas and Louisiana
	 	Natural Gas Acquisition	N/A
	 	EXXI Services:	Texas, Louisiana and Mississippi
	 	EPL Pioneer:	Texas
	 	EPL Louisiana:	Louisiana
	 	Nighthawk:	N/A

 

		Item D.	Goods

 

	 	EXXI:	Texas
	 	EXXI GOM:	Texas and Louisiana
	 	EXXI Leasehold:	Texas and Louisiana
	 	EXXI Onshore:	Louisiana
	 	EXXI Pipeline:	Louisiana
	 	EXXI Pipeline II:	Louisiana
	 	EXXI Texas:	Texas
	 	MS Onshore:	Texas and Mississippi
	 	M21K:	Texas and Louisiana
	 	Soileau:	Texas and Louisiana
	 	EPL:	Texas and Louisiana
	 	Anglo-Suisse:	Louisiana and Texas
	 	Delaware EPL:	Texas
	 	Energy Partners:	N/A
	 	EPL Pipeline:	Louisiana
	 	Offshore Services:	N/A
	 	Natural Gas Holdings:	Texas and Louisiana
	 	Natural Gas Acquisition	N/A
	 	EXXI Services:	Texas, Louisiana and Mississippi
	 	EPL Pioneer:	Texas
	 	EPL Louisiana:	Louisiana
	 	Nighthawk:	N/A

 

    
	 	Schedule II-3	 Schedule II to EXXI Pledge
and Security Agreement

     

    

 

		Item E.	Merger or other corporate reorganization.

 

Description of Merger:

 

	 	EXXI:	N/A
	 	EXXI GOM:	N/A
	 	EXXI Leasehold:	N/A
	 	EXXI Onshore:	N/A
	 	EXXI Pipeline:	N/A
	 	EXXI Pipeline II:	N/A
	 	EXXI Texas:	N/A
	 	MS Onshore:	N/A
	 	M21K:	Previous Name: Energy XXI Natural Gas Partners Assets, LLC (name changed 2/17/2012)
	 	 	Previous Name: Natural Gas Partners Assets, LLC (name changed 11/30/2012)
	 	Soileau:	N/A
	 	EPL:	Merger with Clyde Merger Sub, Inc. on June 3, 2014 (wholly-owned subsidiary of EXXI)
	 	 	Previous Name: Energy Partners of Delaware, Ltd. (name changed 9/1/2012 through short-form merger)
	 	Anglo-Suisse:	N/A
	 	Delaware EPL:	N/A
	 	Energy Partners:	Previous name: EPL Acquisition Corp. LLC (name changed 8/28/2012)
	 	EPL Pipeline:	N/A
	 	Offshore Services:	N/A
	 	Natural Gas Holdings:	N/A
	 	Natural Gas Acquisition:	N/A
	 	EXXI Services:	N/A
	 	EPL Pioneer:	N/A
	 	EPL Louisiana:	N/A
	 	Nighthawk:	N/A

 

		Item F.	[Reserved].

 

		Item G.	Deposit Accounts and Securities Accounts.

 

	 	Deposit Accounts	 
	 	 	 
	 	EXXI:	 
	 	Account Description	Account Number
	 	Regions Bank	0114820374
	 	Regions Bank	0114821192
	 	Texas Capital Bank	176000177
	 	US Bank	001050987955

 

    
	 	Schedule II-4	 Schedule II to EXXI Pledge
and Security Agreement

     

    

 

	 	EXXI GOM:	 
	 	Account Description	Account Number
	 	Regions Bank	0114820390
	 	M21K:	 
	 	Account Description	Account Number
	 	Regions Bank	0128195620
	 	Soileau:	 
	 	Account Description	Account Number
	 	Regions Bank	0114821303
	 	EPL:	 
	 	Account Description	Account Number
	 	Regions Bank	0197711462
	 	EXXI Services:	 
	 	Account Description	Account Number
	 	Regions Bank	0114820404
	 	Frost Bank	020614998
	 	Frost Bank	020615013
	 	Citi Bank	30943077

 

	 	EXXI Leasehold:	N/A
	 	EXXI Onshore:	N/A
	 	EXXI Pipeline:	N/A
	 	EXXI Pipeline II:	N/A
	 	EXXI Texas:	N/A
	 	MS Onshore:	N/A
	 	Anglo-Suisse:	N/A
	 	Delaware EPL:	N/A
	 	Energy Partners:	N/A
	 	EPL Pipeline:	N/A
	 	Offshore Services:	N/A
	 	Natural Gas Holdings:	N/A
	 	Natural Gas Acquisition:	N/A
	 	EPL Pioneer:	N/A
	 	EPL Louisiana:	N/A
	 	Nighthawk:	N/A

 

Securities Accounts

 

N/A

 

		Item H.	Letter of Credit Rights.

 

Description of Letter
of Credit Rights: N/A

 

		Item I.	Commercial Tort Claims.

 

Description of Commercial
Tort Claims:

 

    
	 	Schedule II-5	 Schedule II to EXXI Pledge
and Security Agreement

     

    

 

	 	EXXI:	N/A
	 	EXXI GOM:	N/A
	 	EXXI Leasehold:	N/A
	 	EXXI Onshore:	N/A
	 	EXXI Pipeline:	N/A
	 	EXXI Pipeline II:	N/A
	 	EXXI Texas:	N/A
	 	MS Onshore:	N/A
	 	M21K:	N/A
	 	Soileau:	N/A
	 	EPL:	N/A
	 	Anglo-Suisse:	N/A
	 	Delaware EPL:	N/A
	 	Energy Partners:	N/A
	 	EPL Pipeline:	N/A
	 	Offshore Services:	N/A
	 	Natural Gas Holdings:	N/A
	 	Natural Gas Acquisition:	N/A
	 	EXXI Services:	N/A
	 	EPL Pioneer:	N/A
	 	EPL Louisiana:	N/A
	 	Nighthawk:	N/A

 

    
	 	Schedule II-6	 Schedule II to EXXI Pledge
and Security Agreement

     

    

 

SCHEDULE III -A

to Security Agreement

 

INTELLECTUAL PROPERTY COLLATERAL

 

Item A. Patent Collateral.

 

Issued Patents

 

	Country	 	Patent No.	 	Issue Date	 	Inventor(s)	 	Title
	 	 	 	 	 	 	 	 	 
	None	 	 	 	 	 	 	 	 

 

	Pending Patent Applications

 

	Country	 	Serial No.	 	Filing Date	 	Inventor(s)	 	Title
	 	 	 	 	 	 	 	 	 
	None	 	 	 	 	 	 	 	 

 

	Patent Applications in Preparation

 

	Country	 	Docket No.	 	Expected 

Filing Date	 	Inventor(s)	 	Title
	 	 	 	 	 	 	 	 	 
	None	 	 	 	 	 	 	 	 

 

    
	 	Schedule III-A	 Schedule III to EXXI Pledge
and Security Agreement

     

    

 

SCHEDULE III -B

to Security Agreement

Item B. Trademark Collateral.

 

Registered Trademarks

  

	Country	 	Trademark	 	Registration No.	 	Registration Date	 
	 	 	 	 	 	 	 	 
	USA	 	Energy XXI (Design plus words, letters, and/or numbers)	 	3372707	 	1/22/2008	 
	 	 	 	 	 	 	 	 
	USA	 	Energy XXI (Standard character mark)	 	3372705	 	1/22/2008	 

 

	Pending Trademark Applications

 

	Country	 	Trademark	 	Serial No.	 	Filing Date	 
	 	 	 	 	 	 	 	 
	None	 	 	 	 	 	 	 

 

	Trademark Applications in Preparation

 

 

	Country	 	Trademark	 	Docket No.	 	
        Expected Filing

        Date
	 	Products/Services
	 	 	 	 	 	 	 	 	 
	None	 	 	 	 	 	 	 	 

 

    
	 	Schedule III-B	 Schedule III to EXXI Pledge
and Security Agreement

     

    

 

SCHEDULE III -C

to Security Agreement

 

Item C. Copyright Collateral.

 

Registered Copyrights/Mask Works

 

	Country	 	Registration No.	 	Registration Date	 	Author(s)	 	Title
	 	 	 	 	 	 	 	 	 
	None	 	 	 	 	 	 	 	 

 

	Copyright/Mask Work Pending Registration Applications

 

	Country	 	Serial No.	 	Filing Date	 	Author(s)	 	Title
	 	 	 	 	 	 	 	 	 
	None	 	 	 	 	 	 	 	 

 

	Copyright/Mask Work Registration Applications In Preparation

 

	Country	 	Docket No.	 	Expected 

Filing Date	 	Inventor(s)	 	Title
	 	 	 	 	 	 	 	 	 
	None	 	 	 	 	 	 	 	 

 

    
	 	Schedule III-C	 Schedule III to EXXI Pledge
and Security Agreement

     

    

 

[FORM OF] ASSUMPTION AGREEMENT

Annex I to

First Lien Pledge and Security Agreement and Irrevocable Proxy

 

ASSUMPTION AGREEMENT
(this “Assumption Agreement”), dated as of [ ], 20[ ], made by [ ] (the “Additional Grantor”),
in favor of Wells Fargo Bank, National Association, as administrative agent (in such capacity, the “Administrative Agent”)
for the banks and other financial institutions or entities (the “Lenders”) parties to the First Lien Credit
Agreement referred to below. All capitalized terms not defined herein shall have the meaning ascribed to them in such First Lien
Credit Agreement.

 

WITNESSETH :

 

WHEREAS, Energy XXI
Gulf Coast, Inc. (the “Borrower”), the Lenders and the Administrative Agent have entered into the First Lien
Exit Credit Agreement, dated as of December 30, 2016 (as amended, supplemented or otherwise modified from time to time, the “First
Lien Credit Agreement”);

 

WHEREAS, in connection
with the First Lien Credit Agreement the Borrower and certain of its Affiliates (other than the Additional Grantor) have entered
into the First Lien Pledge and Security Agreement and Irrevocable Proxy, dated as of December 30, 2016 (as amended, supplemented
or otherwise modified from time to time, the “Security Agreement”) in favor of the Administrative Agent for
the ratable benefit of the Secured Persons;

 

WHEREAS, the First
Lien Credit Agreement requires the Additional Guarantor to become a party to the Security Agreement; and

 

WHEREAS, the Additional
Grantor has agreed to execute and deliver this Assumption Agreement in order to become a party to the Security Agreement;

 

NOW, THEREFORE, IT
IS AGREED:

 

1.            First Lien
Pledge and Security Agreement and Irrevocable Proxy. By executing and delivering this Assumption Agreement, the Additional
Grantor, as provided in Section 7.11 of the Security Agreement, hereby becomes a party to the Security Agreement as
a Grantor thereunder with the same force and effect as if originally named therein as a Grantor and, without limiting the generality
of the foregoing, hereby expressly (a) assumes all obligations and liabilities of a Grantor thereunder; and (b) grants to
the Administrative Agent, for the ratable benefit of the Secured Persons, a security interest in such Additional Grantor’s
right, title and interest in and to the Collateral, wherever located and whether now owned or at any time hereafter acquired by
the Additional Grantor or in which the Additional Grantor now has or at any time in the future may acquire any right, title or
interest, as security for the prompt and complete payment and performance when due (whether at stated maturity, by acceleration
or otherwise) of the Additional Grantor’s Secured Obligations. The information set forth in Annex 1-A hereto is hereby
added to the information set forth in Schedules II and III to the Security Agreement. The Additional Grantor hereby represents
and warrants that each of the representations and warranties contained in Article III of the Security Agreement, as
they relate to the Additional Grantor and its Collateral, is true and correct on and as the date hereof (after giving effect to
this Assumption Agreement) as if made on and as of such date.

 

    Annex I - 1

     

    

 

2.            Governing
Law. THIS ASSUMPTION AGREEMENT, THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS ASSUMPTION AGREEMENT AND ANY CLAIM OR
CONTROVERSY ARISING OUT OF OR RELATED TO THIS ASSUMPTION AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK.

 

3.            Acceptance.
The Additional Grantor hereby expressly waives notice of acceptance of this Assumption Agreement, acceptance on the part of the
Administrative Agent and the other Secured Persons being conclusively presumed by their request for this Assumption Agreement and
delivery of the same to the Administrative Agent.

 

IN WITNESS WHEREOF,
the undersigned has caused this Assumption Agreement to be duly executed and delivered as of the date first above written.

 

	 	[ADDITIONAL GRANTOR]
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:

 

    Annex I - 2

     

    

 

Annex I-A

Schedule I to Security Agreement

 

[GRANTOR]

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	Common

 Stock	 	 	 	 
	Pledged Interests Issuer

 (corporate)	 	Cert. #	 	# of

 Shares	 	 	Authorized

 Shares	 	 	Outstanding

 Shares	 	 	% of

 Shares

 Pledged	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

 

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	 	 	 	 	 	 	 

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	 	 	 	 	 	 	 	 	 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

    Annex I-A
Schedule I to Security Agreement

     

    

 

Annex I-A

Schedule II to Security Agreement

 

		Item A-1.	Location of each Grantor for purposes of UCC.

 

[State:]

 

		Item A-2.	Grantor’s place of business or principal office.

 

1021 Main Street, Suite 2626

Houston, TX 77002

 

		Item A-3.	Taxpayer ID number.

 

		Item B.	Equipment.

  

    Annex I-A
Schedule II to Security Agreement

     

    

 

Annex I-A

Schedule II to Security Agreement

 

		Item C.	Inventory.

 

		Item D.	Goods

 

		Item E.	Merger or other corporate reorganization.

 

    Annex I-A
Schedule II-B to Security Agreement

     

    

 

Annex I-A

Schedule II to Security Agreement

 

		Item F.	[Reserved].

 

		Item G.	Deposit Accounts and Securities Accounts.

 

Deposit Accounts

 

Securities Accounts

 

		Item H.	Letter of Credit Rights.

 

Description of Letter
of Credit Rights:

 

		Item I.	Commercial Tort Claims.

 

Description of Commercial
Tort Claims:

 

    Annex I-A
Schedule II-C to Security Agreement

     

    

 

Annex I-A

Schedule III-B to Security Agreement

 

INTELLECTUAL PROPERTY COLLATERAL

 

Item A. Patent Collateral.

 

Issued Patents

 

	Country	 	Patent No.	 	Issue Date	 	Inventor(s)	 	Title
	 	 	 	 	 	 	 	 	 
	None	 	 	 	 	 	 	 	 

 

	Pending Patent Applications

 

	Country	 	Serial No.	 	Filing Date	 	Inventor(s)	 	Title
	 	 	 	 	 	 	 	 	 
	None	 	 	 	 	 	 	 	 

 

	Patent Applications in Preparation

 

	Country	 	Docket No.	 	Expected 

Filing Date	 	Inventor(s)	 	Title
	 	 	 	 	 	 	 	 	 
	None	 	 	 	 	 	 	 	 

 

    Annex I-A
Schedule III-B to Security Agreement

     

    

 

Annex I-A

Schedule III-B to Security Agreement

 

Item B. Trademark Collateral.

 

Registered Trademarks

 

	Country	 	Trademark	 	Registration No.	 	Registration Date	 
	 	 	 	 	 	 	 	 
	None	 	 	 	 	 	 	 

 

	Pending Trademark Applications

 

	Country	 	Trademark	 	Serial No.	 	Filing Date	 
	 	 	 	 	 	 	 	 
	None	 	 	 	 	 	 	 

 

	Trademark Applications in Preparation

 

	Country	 	Trademark	 	Docket No.	 	Expected Filing Date	 	Products/Services
	 	 	 	 	 	 	 	 	 
	None	 	 	 	 	 	 	 	 

 

    Annex I-A
Schedule III-B to Security Agreement

     

    

 

Annex I-A

Schedule III-C to Security Agreement

 

Item C. Copyright Collateral.

 

Registered Copyrights/Mask Works

 

	Country	 	Registration No.	 	Registration Date	 	Author(s)	 	Title
	 	 	 	 	 	 	 	 	 
	None	 	 	 	 	 	 	 	 

 

	Copyright/Mask Work Pending Registration Applications

 

	Country	 	Serial No.	 	Filing Date	 	Author(s)	 	Title
	 	 	 	 	 	 	 	 	 
	None	 	 	 	 	 	 	 	 

 

	Copyright/Mask Work Registration Applications In Preparation

 

	Country	 	Docket No.	 	Expected 

Filing Date	 	Inventor(s)	 	Title
	 	 	 	 	 	 	 	 	 
	None	 	 	 	 	 	 	 	 

  

    Annex I-A
Schedule III-C to Security Agreement

     

    

 

[FORM OF] SUPPLEMENT

 

Annex II to

First Lien Pledge and Security Agreement and Irrevocable Proxy

 

SUPPLEMENT (this “Supplement”),
dated as of [ ], 20[ ], made by [        ] (the “Grantor”), in favor
of Wells Fargo Bank, National Association, as administrative agent (in such capacity, the “Administrative Agent”)
for the banks and other financial institutions or entities (the “Lenders”) parties to the First Lien Credit
Agreement referred to below. All capitalized terms not defined herein shall have the meaning ascribed to them in such First Lien
Credit Agreement.

 

WITNESSETH :

 

WHEREAS, Energy XXI
Gulf Coast, Inc. (the “Borrower”), the Lenders and the Administrative Agent have entered into the First Lien
Exit Credit Agreement, dated as of December 30, 2016 (as amended, supplemented or otherwise modified from time to time, the “First
Lien Credit Agreement”);

 

WHEREAS, in connection
with the First Lien Credit Agreement, the Borrower and certain of its Affiliates (including the Grantor) have entered into the
First Lien Pledge and Security Agreement and Irrevocable Proxy, dated as of December 30, 2016 (as amended, supplemented or otherwise
modified from time to time, the “Security Agreement”) in favor of the Administrative Agent for the ratable benefit
of the Secured Parties;

 

WHEREAS, the First
Lien Credit Agreement requires the Grantor to pledge the Equity Interests described in Annex 1-A hereto; and

 

WHEREAS, the Grantor
has agreed to execute and deliver this Supplement in order to pledge such Equity Interests;

 

NOW, THEREFORE, IT
IS AGREED:

 

1.         First Lien
Pledge and Security Agreement and Irrevocable Proxy. By executing and delivering this Supplement, the information set forth
in Annex 1-A hereto is hereby added to the information set forth in Schedule I to the Security Agreement. The
Grantor hereby represents and warrants that each of the representations and warranties contained in Article 3 of the
Security Agreement is true and correct on and as the date hereof (after giving effect to this Supplement) as if made on and as
of such date.

 

2.         Governing
Law. THIS SUPPLEMENT, THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS SUPPLEMENT AND ANY CLAIM OR CONTROVERSY ARISING
OUT OF OR RELATED TO THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE
OF NEW YORK.

 

    Annex II - 1

     

    

 

3.         Acceptance.
The Grantor hereby expressly waives notice of acceptance of this Supplement, acceptance on the part of the Administrative Agent
and the other Secured Parties being conclusively presumed by their request for this Supplement and delivery of the same to the
Administrative Agent.

 

IN WITNESS WHEREOF,
the undersigned has caused this Supplement to be duly executed and delivered as of the date first above written.

 

	 	[GRANTOR]
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:

 

    Annex II - 2

     

    

 

Annex II-A

Schedule I to Security Agreement

[GRANTOR]

 

ITEM A — PLEDGED INTERESTS

 

	 	 	 	 	 	 	 	 	 	 	Common 
Stock	 	 	 	 
	Pledged Interests Issuer 

(corporate)	 	Cert. #	 	#
                                         of
 Shares
	 	 	Authorized
 Shares
	 	 	Outstanding
 Shares
	 	 	%
                                         of
 Shares
 Pledged
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

  

	 	 	Limited Liability Company Interests
	Pledged Interests Issuer (limited 
 liability company)	 	% of Limited Liability 
 Company Interests
    Pledged	 	 	Type of Limited Liability
 Company Interests Pledged
	 	 	 	 	 	 	 

 

	 	 	Partnership Interests	 
	Pledged Interests Issuer (partnership)	 	% of Partnership
 Interests Owned	 	 	% of Partnership
 Interests Owned	 
	 	 	 	 	 	 	 	 	 

 

ITEM B — PLEDGED NOTES

 

		1.	Pledged Note Issuer Description:

 

    Annex II-AExhibit 10.5

 

Execution Version

 

WARRANT AGREEMENT

 

THIS WARRANT AGREEMENT
(this “Agreement”), dated as of December 30, 2016, is by and among reorganized Energy XXI Gulf Coast, Inc.,
a Delaware corporation (the “Company”), and Continental Stock Transfer & Trust Company, a New York corporation
(together with its successors and assigns, the “Warrant Agent”).

 

WHEREAS, on
April 14, 2016, Energy XXI Ltd and its affiliated debtors (collectively, the “Debtors”) filed voluntary petitions
for relief under chapter 11 of title 11 of the United States Code (as amended, the “Bankruptcy Code”), in the
United States Bankruptcy Court for the Southern District of Texas (the “Bankruptcy Court”), Case No. 16-31928;

 

WHEREAS, on
November 21, 2016, the Debtors filed the Debtors’ Second Amended Proposed Joint Chapter 11 Plan of Reorganization (as
amended or supplemented from time to time, the “Plan of Reorganization”);

 

WHEREAS, on
December 13, 2016, the Bankruptcy Court entered an order confirming the Plan of Reorganization, and the Debtors emerged from their
chapter 11 cases on the date first written above (the “Effective Date”);

 

WHEREAS, pursuant
to the Plan of Reorganization, the Company will issue or cause to be issued, on or as soon as reasonably practicable after the
Effective Date, warrants (the “Warrants”) (a) to purchase 1,271,933 shares of the Company’s common stock,
par value $0.01 per share (“Common Stock”), representing an aggregate total of 3.6% of the total number of shares
of Common Stock issuable pursuant to the Plan of Reorganization (subject to dilution from the Management Incentive Plan, as defined
in the Plan of Reorganization) to holders of EGC Unsecured Notes Claims (as defined in the Plan of Reorganization) and (b) to purchase
847,956 shares of Common Stock, representing an aggregate total of 2.4% of the total number of shares of Common Stock issuable
pursuant to the Plan of Reorganization (subject to dilution from the Management Incentive Plan, as defined in the Plan of Reorganization)
to holders of EPL Unsecured Notes Claims (as defined in the Plan of Reorganization);

 

WHEREAS, the
Company desires to provide for the form and provisions of the Warrants, the terms upon which they shall be issued and exercised,
and the respective rights, limitation of rights, and immunities of the Company, the Warrant Agent, and the holders of the Warrants;

 

WHEREAS, the
Company desires the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing to so act, in connection with
the issuance, registration, transfer, exchange, call, exercise and cancellation of the Warrants; and

 

WHEREAS, all
acts and things have been done and performed which are necessary to make the Warrants, when issued, the valid, binding and legal
obligations of the Company, and to authorize the execution and delivery of this Agreement.

 

NOW, THEREFORE,
in consideration of the mutual agreements herein contained, the parties hereto agree as follows:

 

     

     

    

 

Article
I

 

DEFINITIONS

 

Section 1.1           Definition
of Terms. As used in this Agreement, the following capitalized terms shall have the following respective meanings:

 

(a)          “Additional
Common Stock” has the meaning set forth in Section 5.1 hereof.

 

(b)          “Adjustment
Event” has the meaning set forth in Section 5.2 hereof.

 

(c)          “Affiliate”
has the meaning set forth in Rule 12b-2 of the Exchange Act.

 

(d)          “Appropriate
Officer” has the meaning set forth in Section 3.2(a) hereof.

 

(e)          “Bankruptcy
Code” has the meaning set forth in the Recitals.

 

(f)          “Beneficial
Holders” means, with respect to any Warrants represented by a Global Warrant Certificate, any person or entity that “beneficially
owns” (as such term is defined and determined pursuant to Rule 13d-3 promulgated under the Exchange Act) such Warrants.

 

(g)          “Board
of Directors” means the Board of Directors of the Company.

 

(h)          “Book-Entry
Warrants” has the meaning set forth in Section 3.1(c) hereof.

 

(i)           “Business
Day” means any day other than a Saturday, Sunday or any other day on which the New York Stock Exchange is closed for
trading.

 

(j)           “Certificated
Warrant” has the meaning set forth in Section 3.1(c) hereof.

 

(k)          “Common
Stock” has the meaning set forth in the Recitals, and shall include any successor security as a result of any recapitalization,
reorganization, reclassification or similar transaction involving the Company.

 

(l)           “Convertible
Securities” means any securities (directly or indirectly) convertible into or exchangeable for Common Stock, but excluding
Options.

 

(m)         “Current
Sale Price” of the Common Stock on any date of determination means:

 

    	 	2	 

     

    

 

(i)          if
the Common Stock is listed on the New York Stock Exchange or The NASDAQ Stock Market on such date, the average closing sale price
per share of the Common Stock (or if no closing sale price is reported, the average of the closing bid and closing ask prices or,
if more than one in either case, the average of the average closing bid and the average closing ask prices) for the ten (10) consecutive
trading days immediately prior to such date of determination, as reported by the New York Stock Exchange or The NASDAQ Stock Market,
as applicable;

 

(ii)         if
the Common Stock is not listed on the New York Stock Exchange or The NASDAQ Stock Market on such date, but is listed on another
U.S. national or regional securities exchange, the average closing sale price per share of the Common Stock (or if no closing sale
price is reported, the average of the high bid and low asked prices or, if more than one in either case, the average of the average
high bid and low asked prices) for the ten (10) consecutive trading days immediately prior to such date of determination, as reported
in composite transactions for such securities exchange (or, if more than one, the principal securities exchange on which the Common
Stock is traded);

 

(iii)        if
the Common Stock is not listed on a U.S. national or regional securities exchange, but is traded on an over-the-counter market,
the average last quoted sale price for the Common Stock (or, if no sale price is reported, the average of the high bid and low
asked price for such date) for the ten (10) consecutive trading days immediately prior to such date of determination, in the over-the-counter
market as reported by OTC Markets Group Inc. or other similar organization; or

 

(iv)        in
all other cases, the fair market value per share of the Common Stock, which the Board of Directors shall determine in good faith
(subject to the rights of the Holders set forth in Section 9.13), taking into account any recent fairness opinion or other valuation
report obtained by the Board of Directors or the Company (it being understood that neither the Board of Directors nor the Company
shall have any obligation hereunder to obtain such an opinion or report).

 

The Current Sale Price shall
be determined without reference to early hours, after hours or extended market trading.

 

The Current Sale Price shall
be appropriately adjusted by the Board of Directors in good faith if the “ex date” (as hereinafter defined) for any
event (other than the issuance or distribution requiring such computation) occurs during the ten (10) consecutive trading days
immediately prior to the day as of which the Current Sale Price is being determined.

 

For these purposes
the term “ex date”, when used:

 

(i)          with
respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the relevant exchange
or in the relevant market from which the sale price or bid and ask prices, as applicable, were obtained without the right to receive
such issuance or distribution;

 

    	 	3	 

     

    

 

(ii)         with
respect to any subdivision or combination of shares of Common Stock, means the first date on which the Common Stock trades regular
way on such exchange or in such market after the time at which such subdivision or combination becomes effective; and

 

(iii)        with
respect to any tender or exchange offer, means the first date on which the Common Stock trades regular way on such exchange or
in such market after the expiration time of such offer.

 

The foregoing adjustments shall
be made to the Current Sale Price in accordance with the terms hereof, as may be necessary or appropriate to effectuate the intent
of this Agreement and to avoid unjust or inequitable results as determined in good faith by the Board of Directors.

 

(n)          “Date
of Issuance” has the meaning set forth in Section 3.1(a) hereof.

 

(o)          “Depositary”
has the meaning set forth in Section 3.1(c) hereof.

 

(p)          “Direct
Registration Warrants” has the meaning set forth in Section 3.1(c) hereof.

 

(q)          “Effective
Date” has the meaning set forth in the Recitals.

 

(r)          “Exchange
Act” means the Securities Exchange Act of 1934, as amended.

 

(s)          “Exercise
Date” means any date, on or prior to the expiration of the Exercise Period, on which the Holder exercises the right to
purchase the Warrant Exercise Shares, in whole or in part, pursuant to and in accordance with the terms and conditions described
herein.

 

(t)          “Exercise
Form” has the meaning set forth in Section 4.3(d) hereof.

 

(u)          “Exercise
Price” has the meaning set forth in Section 4.1 hereof.

 

(v)         “Exercise
Period” has the meaning set forth in Section 4.2 hereof.

 

(w)         “Fully
Diluted” means all Common Stock outstanding as of the applicable measurement date together with all Common Stock then
issuable upon (i) the conversion of Convertible Securities at the then applicable conversion rate, and (ii) the exercise of any
Options; provided, that, for purposes of clauses (i) and (ii), all conditions to the convertibility and/or exercisability
of Convertible Securities and Options of the Company, shall be deemed to have been satisfied.

 

(x)          “Global
Warrant Certificates” has the meaning set forth in Section 3.1(c) hereof.

 

    	 	4	 

     

    

 

(y)          “Governmental
Authority” means any (i) government, (ii) governmental or quasi-governmental authority of any nature (including
any governmental agency, branch, department, official or entity and any court or other tribunal) or (iii) body exercising,
or entitled to exercise, any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power
of any nature, in each case, whether federal, state, local, municipal, foreign, supranational or of any other jurisdiction.

 

(z)          “Holder”
has the meaning set forth in Section 4.1 hereof.

 

(aa)        “Law”
means all laws, statutes, rules, regulations, codes, injunctions, decrees, orders, ordinances, registration requirements, disclosure
requirements and other pronouncements having the effect of law of the United States, any foreign country or any domestic or foreign
state, county, city or other political subdivision or of any Governmental Authority.

 

(bb)        “Options”
means any warrants or other rights or options to subscribe for or purchase Common Stock or Convertible Securities.

 

(cc)        “Organic
Change” means any recapitalization, reorganization, reclassification, consolidation, merger, sale of all or substantially
all of the Company’s equity securities or assets or other transaction, in each case which is effected in such a way that
the holders of Common Stock are entitled to receive (either directly or upon subsequent liquidation) cash, stock, securities or
other assets or property with respect to or in exchange for Common Stock, other than a transaction which triggers an adjustment
pursuant to Sections 5.1, 5.2 or 5.3.

 

(dd)        “Person”
means any individual, firm, corporation, partnership, limited partnership, limited liability company, association, indenture trustee,
organization, joint stock company, joint venture, estate, trust, governmental unit or any political subdivision thereof, or any
other entity (as such term is defined in the Bankruptcy Code).

 

(ee)        “Plan
of Reorganization” has the meaning set forth in the Recitals.

 

(ff)        “Pro
Rata Repurchase Offer” means any offer to purchase shares of Common Stock by the Company or any Affiliate thereof pursuant
to (i) any tender offer or exchange offer subject to Section 13(e) or 14(e) of the Exchange Act or Regulation 14E promulgated thereunder
or (ii) any other offer available to all or substantially all holders of Common Stock (subject to satisfaction of any conditions
to participation therein such as those relating to minimum holding percentages or accredited status) to purchase or exchange their
shares of Common Stock, in the case of both (i) or (ii), whether for cash, shares of capital stock of the Company, other securities
of the Company, evidences of indebtedness of the Company or any other Person, or any other property (including, without limitation,
shares of capital stock, other securities or evidences of indebtedness of a Subsidiary), or any combination thereof, effected while
the Warrants are outstanding. The “effective date” of a Pro Rata Repurchase Offer shall mean the date of acceptance
of shares for purchase or exchange by the Company under any tender or exchange offer which is a Pro Rata Repurchase Offer or the
date of purchase with respect to any Pro Rata Repurchase Offer that is not a tender or exchange offer.

 

    	 	5	 

     

    

 

(gg)        “Registered
Holder” has the meaning set forth in Section 3.3(d) hereof.

 

(hh)        “Requisite
Holders” means Registered Holders of Warrants exercisable for a majority of the Common Stock issuable upon exercise of
all Warrants then outstanding; provided that, in the case of the Book Entry Warrants, the Requisite Holders shall be the
respective customers of the street name holders thereof, as set forth on the books of such street name holders.

 

(ii)          “SEC”
means the Securities and Exchange Commission or any other federal agency at the time administering the Securities Act or the Exchange
Act.

 

(jj)          “Securities
Act” means the Securities Act of 1933, as amended.

 

(kk)        “Subsidiary”
means, with respect to any Person, any corporation, partnership, limited liability company or other business entity of which (i)
if a corporation, a majority of the total voting power of shares of stock entitled (without regard to the occurrence of any contingency)
to vote in the election of directors is at the time owned or controlled, directly or indirectly, by that Person or one or more
of the other Subsidiaries of that Person or a combination thereof, or (ii) if a partnership, limited liability company or other
business entity (other than a corporation), a majority of the partnership, limited liability company or other similar ownership
interest thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries
of that Person or a combination thereof. For purposes hereof, a Person or Persons shall be deemed to have a majority ownership
interest in a partnership, limited liability company or other business entity if such Person or Persons shall be allocated a majority
of partnership, limited liability company or other business entity gains or losses or shall be or control the general partner,
the managing member or entity performing similar functions of such partnership, limited liability company or other business entity.

 

(ll)          “Transfer”
means any transfer, sale, assignment or other disposition.

 

(mm)       “Warrant
Agent” has the meaning set forth in the preamble and shall include any successor to the Warrant Agent pursuant to Section
8.1 hereof.

 

(nn)        “Warrant
Certificate” has the meaning set forth in Section 3.1(c) hereof.

 

(oo)        “Warrant
Exercise Shares” means the shares of Common Stock issued upon the exercise of a Warrant.

 

    	 	6	 

     

    

 

(pp)        “Warrant
Register” has the meaning set forth in Section 3.3(c) hereof.

 

(qq)        “Warrant
Restrictions” has the meaning set forth in Section 3.1(c) hereof.

 

(rr)          “Warrant
Statements” has the meaning set forth in Section 3.1(c) hereof.

 

(ss)        “Warrants”
has the meaning set forth in the Recitals.

 

Section 1.2           Rules
of Construction.

 

(a)          The
singular form of any word used herein, including the terms defined in Section 1.1 hereof, shall include the plural, and
vice versa. The use herein of a word of any gender shall include correlative words of all genders.

 

(b)          Unless
otherwise specified, references to Articles, Sections and other subdivisions of this Agreement are to the designated Articles,
Sections and other subdivision of this Agreement as originally executed. The words “hereof,” “herein,”
“hereunder” and words of similar import refer to this Agreement as a whole.

 

(c)          References
to “$” are to dollars in lawful currency of the United States of America.

 

(d)          The
Exhibits attached hereto are an integral part of this Agreement.

 

Article
II

 

APPOINTMENT
OF WARRANT AGENT

 

Section 2.1           Appointment.
The Company hereby appoints the Warrant Agent to act as agent for the Company for the Warrants in accordance with the express terms
and subject to the conditions set forth in this Agreement (and no implied terms or conditions), and the Warrant Agent hereby accepts
such appointment and agrees to perform the same in accordance with the express terms and subject to the conditions set forth in
this Agreement.

 

Article
III

 

WARRANTS

 

Section 3.1           Issuance
of Warrants.

 

(a)          On
the terms and subject to the conditions of this Agreement and in accordance with the terms of the Plan of Reorganization, on or
as soon as reasonably practicable after the Effective Date (such date, the “Date of Issuance”), the Company
will issue the Warrants to holders of EGC Unsecured Notes Claims and EPL Unsecured Notes Claims, as set forth in the Plan of Reorganization.

 

    	 	7	 

     

    

 

(b)          The
maximum number of shares of Common Stock issuable pursuant to exercise of the Warrants shall be 2,119,889 shares, as such amount
may be adjusted from time to time pursuant to this Agreement.

 

(c)          Unless
otherwise provided in this Agreement, the Warrants (such Warrants being referred to as “Book-Entry Warrants”)
shall be issued through the book-entry facilities of The Depository Trust Company, as depositary (the “Depositary”),
in the form of one or more global warrant certificates (“Global Warrant Certificates”), duly executed on behalf
of the Company and countersigned, either by manual or facsimile signature, by the Warrant Agent, in the manner set forth in Section
3.2(b) below, which the Company shall deliver, or cause to be delivered to the Depositary, on or as soon as reasonably practicable
after the Effective Date. Notwithstanding the foregoing, any Warrants which are not issuable through the mandatory reorganization
function of the Depositary shall either be (x) represented by certificates (together with the Global Warrant Certificates, “Warrant
Certificates”; and any Warrant represented by a Warrant Certificate, other than a Global Warrant Certificate, being referred
to as a “Certificated Warrant”) or (y) issued by electronic entry registration on the books of the Warrant Agent
(“Direct Registration Warrants”) and shall be reflected on statements issued by the Warrant Agent from time
to time to the holders thereof (the “Warrant Statements”); provided, that any Certificated Warrants or
Direct Registration Warrants that are not subject to any restriction on transfer or exercise, or are not subject to any vesting
requirements (such restrictions or requirements, “Warrant Restrictions”), may be exchanged at any time for a
corresponding number of Book-Entry Warrants, in accordance with Section 6.1(c) and the applicable procedures of the Depositary
and the Warrant Agent.

 

Section 3.2           Form
of Warrant; Execution of Warrant Certificates.

 

(a)          Subject
to Section 6.1 of this Agreement, the Global Warrant Certificates shall be in substantially the form set forth in Exhibit
A-1 attached hereto. The certificates for Certificated Warrants, with the forms of election to exercise and of assignment printed
on the reverse thereof, shall be in substantially the form set forth in Exhibit A-2 attached hereto. The Warrant Certificates
may bear such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Agreement,
may have such letters, numbers or other marks of identification or designation and such legends or endorsements placed thereon
as may be required by the Depositary (including as provided in Section 3.2(b)) and as are consistent with the provisions
of this Agreement, or as may be required to comply with any Law or with any rules or regulations made pursuant thereto or with
any rules of any securities exchange or as may be determined (in a manner consistent with the provisions of this Agreement) by
the Chief Executive Officer or Chief Financial Officer of the Company (each, an “Appropriate Officer”) executing
such Warrant Certificates, as evidenced by their execution of the Warrant Certificates. Such signatures may be manual or facsimile
signatures of such authorized officers and may be imprinted or otherwise reproduced on the Warrant Certificates.

 

    	 	8	 

     

    

 

(b)          In
case any Appropriate Officer of the Company who shall have signed any of the Warrant Certificates (either manually or by facsimile
signature) shall cease to be such Appropriate Officer before the Warrant Certificates so signed shall have been countersigned (either
manually or by facsimile signature) by the Warrant Agent or delivered or disposed of by or on behalf of the Company, such Warrant
Certificates nevertheless may be countersigned and delivered or disposed of with the same force and effect as though such Appropriate
Officer had not ceased to be such Appropriate Officer of the Company; and any Warrant Certificate may be signed on behalf of the
Company by any person who, at the actual date of the execution of such Warrant Certificate, shall be a proper Appropriate Officer
of the Company to sign such Warrant Certificate, although at the date of the execution of this Agreement any such person was not
such Appropriate Officer.

 

(c)          The
Global Warrant Certificates shall bear a legend substantially in the form indicated therefor on Exhibit A-1. The Global
Warrant Certificates shall be deposited on or after the Date of Issuance with the Warrant Agent and registered in the name of Cede
& Co., as the nominee of the Depositary. Each Global Warrant Certificate shall represent such number of the outstanding Warrants
as specified therein, and each shall provide that it shall represent the aggregate amount of outstanding Warrants from time to
time endorsed thereon and that the aggregate amount of outstanding Warrants represented thereby may from time to time be reduced
or increased, as appropriate, in accordance with the terms of this Agreement.

 

(d)          A
Warrant Certificate shall be, and shall remain, subject to the provisions of this Agreement until such time as all of the Warrants
evidenced thereby shall have been duly exercised or shall have expired or been cancelled in accordance with the terms hereof.

 

Section 3.3           Registration
and Countersignature.

 

(a)          Upon
receipt of a written order of the Company signed by an Appropriate Officer instructing the Warrant Agent to do so, the Warrant
Agent (i) shall upon receipt of Warrant Certificates, including the Global Warrant Certificates, duly executed on behalf of the
Company, countersign, either by manual or facsimile signature, such Global Warrant Certificates evidencing Warrants, and record
such Warrant Certificates, including the Registered Holders thereof, in the Warrant Register, and (ii) shall register in the Warrant
Register any Direct Registration Warrants in the names of the initial Registered Holders thereof. Such written order of the Company
shall specifically state the number of Warrants that are to be issued as Certificated Warrants or Direct Registration Warrants
and the name of the Registered Holders thereof, and the number of Warrants that are to be issued as Book-Entry Warrants, and the
Warrant Agent may rely conclusively on such written order. Notwithstanding the foregoing or anything else in this Agreement to
the contrary, the Company shall not instruct the Warrant Agent to register any Direct Registration Warrants unless and until the
Warrant Agent shall confirm to the Company in writing that it has the capabilities to accommodate Direct Registration Warrants.

 

    	 	9	 

     

    

 

(b)          No
Warrant Certificate shall be valid for any purpose, and no Warrant evidenced thereby shall be exercisable, until such Warrant Certificate
has been countersigned by the manual or facsimile signature of the Warrant Agent. Such signature by the Warrant Agent upon any
Warrant Certificate executed by the Company shall be conclusive evidence that such Warrant Certificate so countersigned has been
duly issued hereunder.

 

(c)          The
Warrant Agent shall keep or cause to be kept, at an office designated for such purpose, books (the “Warrant Register”)
in which, subject to such reasonable regulations as it may prescribe, it shall register the Certificated Warrants or Direct Registration
Warrants, and the Warrants represented by Global Warrant Certificates, and exercises, exchanges, cancellations and transfers of
outstanding Warrants in accordance with the procedures set forth in Section 6.1 of this Agreement, all in a form reasonably
satisfactory to the Company and the Warrant Agent. No service charge shall be made for any exchange or registration of transfer
of the Warrants, but the Company may require payment of a sum sufficient to cover any stamp or other tax or other charge that may
be imposed on any Registered Holder in connection with any such exchange or registration of transfer. The Warrant Agent shall have
no obligation to effect an exchange or register a transfer unless and until it is satisfied that any payments required by the immediately
preceding sentence have been made.

 

(d)          Prior
to due presentment for registration of transfer or exchange of any Warrants in accordance with the procedures set forth in this
Agreement, the Company and the Warrant Agent may deem and treat the person in whose name such Warrants are registered upon the
Warrant Register (the “Registered Holder” of such Warrants) as the absolute owner of such Warrants, for all
purposes including, without limitation, for the purpose of any exercise thereof (subject to Section 4.3(d)(z)), any distribution
to the Holder thereof and for all other purposes (subject to Section 4.1(ii)), and neither the Warrant Agent nor the Company shall
be affected by notice to the contrary. Neither the Company nor the Warrant Agent will be liable or responsible for any registration
or transfer of any Warrants that are registered or to be registered in the name of a fiduciary or the nominee of a fiduciary.

 

Article
IV

 

TERMS
AND EXERCISE OF WARRANTS

 

Section 4.1           Exercise
Price. Each Warrant shall entitle (i) in the case of the Certificated Warrants or Direct Registration Warrants, the Registered
Holder thereof and (ii) in the case of Book-Entry Warrants, the Beneficial Holder thereof ((i) and (ii) collectively, the “Holder”),
subject to the provisions of this Agreement and applicable law, the right to purchase from the Company one share of Common
Stock (subject to adjustment from time to time as provided in Article V hereof), at the price of $43.66 per share (subject
to adjustment from time to time as provided in Article V, the “Exercise Price”).

 

    	 	10	 

     

    

 

Section 4.2           Exercise
Period. Warrants may be exercised by the Holder thereof, in whole or in part (but not as to a fractional share of Common Stock),
at any time and from time to time after the Date of Issuance and prior to 5:00 P.M., New York time on December 30, 2021 (the “Exercise
Period”). To the extent that a Warrant or portion thereof is not exercised prior to the expiration of the Exercise Period,
it shall be automatically cancelled with no action by any Person, and with no further rights thereunder, upon such expiration.

 

Section 4.3           Method
of Exercise.

 

(a)          In
connection with the exercise of any Warrant, (i) the Holder shall surrender such Warrant (or portion thereof) to the Warrant Agent
for the number of Warrant Exercise Shares being exercised, up to the aggregate number of Warrant Exercise Shares for which the
Warrants are exercisable and (ii) the Exercise Price shall be paid, at the option of the Holder, (x) in United States dollars by
personal, certified or official bank check payable to the Warrant Agent, or by wire transfer to an account specified in writing
by the Company or the Warrant Agent to such Holder, or by any means established for such purpose by the Depositary, in any such
case in immediately available funds in an amount equal to the aggregate Exercise Price for such Warrant Exercise Shares as specified
in the Exercise Form or (y) by cashless exercise as set forth in Section 4.3(b).

 

(b)          In
lieu of paying the Exercise Price by the means specified in Section 4.3(a)(ii)(x), any Holder may elect to exercise Warrants
by authorizing the Company to withhold and not issue to such Holder, in payment of the Exercise Price thereof, a number of such
Warrant Exercise Shares equal to (x) the number of Warrant Exercise Shares for which the Warrants are being exercised, multiplied
by (y) the Exercise Price, and divided by (z) the Current Sale Price on the Exercise Date (and such withheld shares shall no longer
be issuable under such Warrants, and the Holder shall not have any rights or be entitled to any payment with respect to such withheld
shares).

 

(c)          Upon
exercise of any Warrants, the Warrant Agent will as promptly as practicable, within a reasonable time period to enable the Company
to meet its obligations under Section 4.4(a), deliver written notice to the Company to confirm the number of shares of Common Stock
issuable in connection with such exercise. The Company shall calculate and transmit to the Warrant Agent in a written notice, and
the Warrant Agent shall have no duty, responsibility or obligation to calculate, the number of shares of Common Stock issuable
in connection with any exercise. The Warrant Agent shall be entitled to rely conclusively on any such written notice provided by
the Company, and the Warrant Agent shall not be liable for any action taken, suffered or omitted to be taken by it in accordance
with such written instructions or pursuant to this Agreement. Such written notice from the Company shall also set forth the cost
basis for such shares of Common Stock issued pursuant to such exercise.

 

(d)          Subject
to the terms and conditions of this Agreement, the Holder of any Warrants may exercise, in whole or in part, such Holder’s
right to purchase the Warrant Exercise Shares issuable upon exercise of such Warrants by: (x) in the case of Certificated Warrants,
properly completing and duly executing the exercise form for the election to exercise such Warrants (including the exercise forms
referred to in clauses (y) and (z) below, an “Exercise Form”) substantially in the form of Exhibit B-1,
(y) in the case of Direct Registration Warrants, providing an Exercise Form substantially in the form of Exhibit B-2 hereto,
properly completed and duly executed by the Registered Holder thereof, to the Warrant Agent, and (z) in the case of Book-Entry
Warrants, providing an Exercise Form in compliance with the practices and procedures of the Depositary and its direct and indirect
participants, as applicable.

 

    	 	11	 

     

    

 

(e)          Any
exercise of Warrants pursuant to the terms of this Agreement shall be irrevocable as of the date of delivery of the Exercise Form
and shall constitute a binding agreement between the Holder and the Company, enforceable in accordance with the terms of this Agreement.

 

(f)          In
the case of Certificated Warrants, upon receipt of the Warrant Certificate with the properly completed and duly executed Exercise
Form, or in the case of Direct Registration Warrants, upon receipt of an Exercise Form, in each case pursuant to Section 4.3(d),
the Warrant Agent shall:

 

(i)          examine
the Exercise Form and all other documents delivered to it by or on behalf of Holders as contemplated hereunder to ascertain whether
or not, on their face, such Exercise Form and any such other documents have been executed and completed in accordance with their
terms and the terms hereof;

 

(ii)         if
an Exercise Form or other document appears, on its face, to have been improperly completed or executed or some other irregularity
in connection with the exercise of the Warrants exists, endeavor to inform the appropriate parties (including the person submitting
such instrument) of the need for fulfillment of all requirements, specifying those requirements which appear to be unfulfilled;

 

(iii)        inform
the Company of and cooperate with and assist the Company in resolving any reconciliation problems between the information provided
on any Exercise Form received and the information on the Warrant Register;

 

(iv)        advise
the Company as promptly as practicable after receipt of an Exercise Form (within a reasonable time period to enable the Company
to meet its obligations under Section 4.4(a)) of (A) the receipt of such Exercise Form and the number of Warrant Exercise Shares
in respect of which the Warrants are requested to be exercised in accordance with the terms and conditions of this Agreement, (B)
the instructions with respect to delivery of the Common Stock deliverable upon such exercise, subject to timely receipt of such
information by the Warrant Agent, and (C) such other information as the Company shall reasonably request; and

 

(v)         subject
to Common Stock being made available to the Warrant Agent by or on behalf of the Company, and written instructions from the Company,
liaise with the transfer agent for the Common Stock for the issuance and registration of the number of shares of Common Stock issuable
upon exercise of the Warrants in accordance with the Exercise Form.

 

    	 	12	 

     

    

 

The Company reserves the right
reasonably to reject any and all Exercise Forms that it determines are not in proper form or for which any corresponding agreement
by the Company to exchange would, in the opinion of the Company, be unlawful. Any such determination by the Company shall be final
and binding on the Holders of the Warrants, absent manifest error. Moreover, the Company reserves the absolute right to waive any
of the conditions to any particular exercise of Warrants or any defects in the Exercise Form(s) with regard to any particular exercise
of Warrants. The Company shall provide prompt written notice to the Warrant Agent of any such rejection or waiver.

 

(g)          In
the case of Book-Entry Warrants, the Company and the Warrant Agent shall cooperate with the Depositary and its direct and indirect
participants in order to effectuate the exercise of such Warrants, in accordance with the applicable practices and procedures of
the Depositary and such participants, including the manner of delivery of notice of exercise by the Beneficial Holders thereof,
in such form as shall be prescribed by such participants, as applicable.

 

(h)          The
Warrant Agent shall forward funds received for warrant exercises in a given month by the fifth business day of the following month
by wire transfer to an account designated by the Company.

 

Section 4.4           Issuance
of Common Stock.

 

(a)          Upon
the effectiveness of any exercise of any Warrants pursuant to Section 4.3, the Company shall, subject to Section 4.6,
promptly at its expense, and in no event later than five (5) Business Days after the Exercise Date, cause to be issued as directed
by the Holder of such Warrants the total number of whole shares of Common Stock for which such Warrants are being exercised (as
the same may be hereafter adjusted pursuant to Article V) in such denominations as are requested by the Holder as set forth
below: (i) in the case of the exercise of any Certificated Warrants or Direct Registration Warrants by the Registered Holder thereof,
registered as directed by the Holder, (ii) in the case of the exercise of any Book-Entry Warrants by the Beneficial Holder thereof,
by same day or next day credit to the Depositary in accordance with the practices and procedures of the Depositary and its respective
participants, delivered to such account as directed by the Holder.

 

(b)          The
Warrant Exercise Shares shall be deemed to have been issued at the time at which all of the conditions to such exercise have been
fulfilled, and the Holder, or other person to whom the Holder shall direct the issuance thereof, shall be deemed for all purposes
to have become the holder of such Warrant Exercise Shares at such time.

 

Section 4.5           Reservation
of Shares.

 

(a)          During
the Exercise Period, the Company shall at all times reserve and keep available out of its authorized but unissued shares of Common
Stock solely for the purpose of issuance upon the exercise of the Warrants, a number of shares of Common Stock equal to the aggregate
Warrant Exercise Shares issuable upon the exercise of all outstanding Warrants. The Company shall take all such actions as shall
be necessary to assure that all such shares of Common Stock may be so issued without violating the Company’s governing documents,
any agreements to which the Company is a party on the date hereof, any requirements of any national securities exchange upon which
shares of Common Stock may be listed or any applicable Laws. The Company shall not take any action which would cause the number
of authorized but unissued shares of Common Stock to be less than the number of such shares required to be reserved hereunder for
issuance upon exercise of the Warrants.

 

    	 	13	 

     

    

 

(b)          The
Company covenants that it will take such actions as may be necessary or appropriate in order that all Warrant Exercise Shares issued
upon exercise of the Warrants will, upon issuance in accordance with the terms of this Agreement, be fully paid and non-assessable
and free from any and all (i) security interests created by or imposed upon the Company and (ii) taxes, liens and charges with
respect to the issuance thereof. If at any time prior to the expiration of the Exercise Period the number and kind of authorized
but unissued shares of the Company’s capital stock shall not be sufficient to permit exercise in full of the Warrants, the
Company will promptly take such corporate action as may, in the opinion of its counsel, be reasonably necessary (including seeking
stockholder approval, if required) to increase its authorized but unissued shares to such number of shares as shall be sufficient
for such purposes. The Company agrees that its issuance of Warrants shall constitute full authority to its officers who are charged
with the issuance of Warrant Exercise Shares to issue Warrant Exercise Shares upon the exercise of Warrants. Without limiting the
generality of the foregoing, the Company will not increase the stated or par value per share, if any, of the Common Stock without
the prior written consent of Requisite Holders.

 

(c)          The
Company represents and warrants to the Holders that the issuance of the Warrants and the issuance of shares of Common Stock upon
exercise thereof in accordance with the terms hereof will not constitute a breach of, or a default under, any other material agreements
to which the Company is a party on the date hereof.

 

Section 4.6           Fractional
Shares. Notwithstanding any provision to the contrary contained in this Agreement, the Company shall not be required to issue
any fraction of a share of its capital stock in connection with the exercise of any Warrants, and in any case where a Holder of
Warrants would, except for the provisions of this Section 4.6, be entitled under the terms thereof to receive a fraction
of a share upon the exercise of such Warrants, the Company shall, upon the exercise of such Warrants, issue or cause to be issued
only the largest whole number of Warrant Exercise Shares issuable upon such exercise (and such fraction of a share will be disregarded,
and the Holder shall not have any rights or be entitled to any payment with respect to such fraction of a share); provided,
that the number of whole Warrant Exercise Shares which shall be issuable upon the contemporaneous exercise of any Warrants by a
Holder shall be computed on the basis of the aggregate number of Warrant Exercise Shares issuable upon exercise of all such Warrants
by such Holder.

 

Section 4.7           Close
of Books. The Company shall not close its books against the transfer of any Warrants or any Warrant Exercise Shares in
any manner which interferes with the timely exercise of such Warrants.

 

    	 	14	 

     

    

 

Section 4.8           Payment
of Taxes. In connection with the exercise of any Warrants, the Company shall not be required to pay any tax or other charge
imposed in respect of any transfer involved in the Company’s issuance and delivery of shares of Common Stock (including certificates
therefor) (or any payment of cash or other property in lieu of such shares) to any recipient other than the Holder of the Warrants
being exercised, and in case of any such tax or other charge, the Warrant Agent and the Company shall not be required to issue
or deliver any such shares (or cash or other property in lieu of such shares) until (x) such tax or charge has been paid or an
amount sufficient for the payment thereof has been delivered to the Warrant Agent or the Company or (y) it has been established
to the Company’s and the Warrant Agent’s satisfaction that any such tax or other charge that is or may become due has
been paid. For the avoidance of doubt, the Warrant Agent shall not have any duty or obligation to take any action under any section
of this Agreement that requires the payment of taxes or charges, unless and until the Warrant Agent is satisfied that all such
taxes and/or charges have been paid.

 

Article
V

 

ADJUSTMENT
OF EXERCISE PRICE AND NUMBER OF

WARRANT EXERCISE SHARES

 

In order to prevent
dilution of the rights granted under the Warrants, the Exercise Price shall be subject to adjustment from time to time as provided
in this Article V, and the number of shares of Common Stock issuable upon exercise of each Warrant shall be subject to adjustment
from time to time as provided in this Article V; provided, that if more than one subsection of this Article
V is applicable to a single event, the subsection shall be applied that produces the largest adjustment and no single event
shall cause an adjustment under more than one subsection of this Article V so as to result in duplication.

 

Section 5.1           Subdivision
or Combination of Common Stock. In the event that the amount of outstanding Common Stock is increased or decreased by combination
(by reverse stock split or reclassification) or subdivision (by any stock split or reclassification) of the Common Stock or any
distribution by the Company with respect to the Common Stock in the form of additional Common Stock (“Additional Common
Stock”), then, on the effective date of such combination, subdivision or distribution, the number of Warrant Exercise
Shares issuable on exercise of the Warrants shall be increased or decreased, as applicable, in proportion to such increase or decrease,
as applicable, in the outstanding Common Stock. Whenever the number of Warrant Exercise Shares purchasable upon the exercise of
the Warrants is adjusted pursuant to this Section 5.1, the Exercise Price shall be adjusted (to the nearest cent ($0.01))
by multiplying such Exercise Price immediately prior to such adjustment by a fraction (a) the numerator of which shall be the number
of Warrant Exercise Shares purchasable upon the exercise of the Warrants immediately prior to such adjustment and (b) the denominator
of which shall be the number of Warrant Exercise Shares so purchasable immediately thereafter.

 

Section 5.2           Distributions.
If the Company at any time after the issuance of the Warrants but prior to the expiration of the Exercise Period fixes a record
date for the making of a distribution to all holders of shares of the Common Stock of securities, evidences of indebtedness, assets,
cash, rights or warrants (excluding (i) dividends or distributions referred to in Section 5.1 and (ii) regular cash dividends
paid out of earnings or earned surplus, determined in accordance with generally accepted accounting principles), then, in each
such case, the Exercise Price in effect prior to such record date shall be adjusted thereafter to the price determined by the following
formula:

 

    	 	15	 

     

    

 

EP1 = EP0 
x (CP0 - FV)/CP0

 

where

 

	EP1	=	the Exercise Price in effect immediately following the application of the adjustments in this Section 5.2;
	 	 	 
	EP0	=	the Exercise Price in effect immediately prior to the application of the adjustments in this Section 5.2;
	 	 	 
	CP0	=	the Current Sale Price of the Common Stock on the last trading day preceding the first date on which the Common Stock trades regular way without the right to receive such distribution, or, if the Common Stock is not traded on a on a U.S. national or regional securities exchange or an over-the-counter market, the Current Sale Price of the Common Stock without otherwise taking into account the effects of such distribution; and
	 	 	 
	FV	=	the amount of cash and/or the fair market value of the securities, evidences of indebtedness, assets, rights or warrants to be so distributed in respect of one share of Common Stock, which the Board of Directors shall determine in good faith (subject to the rights of the Holders set forth in Section 9.13), taking into account any recent fairness opinion or other valuation report obtained by the Board of Directors or the Company (it being understood that neither the Board of Directors nor the Company shall have any obligation hereunder to obtain such an opinion or report).

 

Such adjustment shall be made successively
whenever such a record date is fixed (an “Adjustment Event”). In such Adjustment Event, the number of Warrant
Exercise Shares issuable upon the exercise of each Warrant shall be increased to the number obtained by dividing (x) the product
of (1) the number of Warrant Exercise Shares issuable upon the exercise of each Warrant before such adjustment, and (2) the Exercise
Price in effect immediately prior to the adjustment by (y) the new Exercise Price immediately following such adjustment.

 

    	 	16	 

     

    

 

In the event that such
distribution is not so made, the Exercise Price and the number of Warrant Exercise Shares issuable upon exercise of the Warrants
then in effect shall be readjusted, effective as of the date when the Board of Directors determines not to distribute such securities,
evidences of indebtedness, assets, cash, rights or warrants, as the case may be, to the Exercise Price that would then be in effect
and the number of Warrant Exercise Shares that would then be issuable upon exercise of the Warrants if such record date had not
been fixed.

 

Section 5.3           Pro
Rata Repurchase Offer of Common Stock. If at any time after the issuance of the Warrants but prior to the expiration of the
Exercise Period the Company consummates a Pro Rata Repurchase Offer of Common Stock, then the Exercise Price shall be reduced to
the price determined by the following formula:

 

EP1
= EP0  x(OS0 x CP0) – AP 

  (OS0
– SP) x CP0

 

where

 

	EP1	=	the Exercise Price in effect immediately following the application of the adjustments in this Section 5.3 (but in no event greater than EP0);
	 	 	 
	EP0	=	the Exercise Price in effect immediately prior to the application of the adjustments in this Section 5.3;
	 	 	 
	OS0	=	the number of Fully Diluted shares of Common Stock outstanding immediately before consummation of such Pro Rata Repurchase Offer;
	 	 	 
	CP0	=	the Current Sale Price of a share of Common Stock on the trading day immediately preceding the first public announcement by the Company or any of its Affiliates of the intent to effect such Pro Rata Repurchase Offer;
	 	 	 
	AP	=	the aggregate purchase price (including the fair market value, as determined in good faith by the Board of Directors, of any non-cash consideration included therein) paid for the shares of Common Stock in the Pro Rata Repurchase Offer; and
	 	 	 
	SP	=	the number of shares of Common Stock so repurchased in the Pro Rata Repurchase Offer.

 

In such event, the Warrant Exercise Shares
issuable upon the exercise of each Warrant shall be increased to the number obtained by dividing (x) the product of (1) the Warrant
Exercise Shares issuable upon the exercise of each Warrant before such adjustment, and (2) the Exercise Price in effect immediately
prior to the adjustment by (y) the new Exercise Price immediately following such adjustment. For the avoidance of doubt, no increase
to the Exercise Price or decrease in the Warrant Exercise Shares issuable upon exercise of the Warrants shall be made pursuant
to this Section 5.3.

 

    	 	17	 

     

    

 

Section 5.4           Reorganization,
Reclassification, Consolidation, Merger or Sale. In connection with any Organic Change prior to the expiration of the Exercise
Period, the Holders’ right to receive shares of Common Stock upon exercise of a Warrant shall be converted into the right
to acquire and receive, upon exercise of such Warrants, such cash, stock, securities or other assets or property as would have
been issued or payable in such Organic Change (as if the Holder had exercised such Warrant immediately prior to such Organic Change)
with respect to or in exchange, as applicable, for the number of Warrant Exercise Shares that would have been issued upon exercise
of such Warrants, if such Warrants had been exercised immediately prior to the occurrence of such Organic Change. The Company shall
not effect any Organic Change unless, prior to the consummation thereof, the surviving Person (if other than the Company) resulting
from such Organic Change, shall assume, by written instrument substantially similar in form and substance to this Agreement in
all material respects (including with respect to the provisions of Article V), the obligation to deliver to the Holders
such cash, stock, securities or other assets or property which, in accordance with the foregoing provision, the Holders shall be
entitled to receive upon exercise of the Warrants. The provisions of this Section 5.4 shall similarly apply to successive
Organic Changes.

 

Section 5.5           Notice
of Adjustments. Whenever the number and/or kind of Warrant Exercise Shares or the Exercise Price is adjusted as herein provided,
the Company shall (i) prepare and deliver, or cause to be prepared and delivered, forthwith to the Warrant Agent a written statement
setting forth the adjusted number and/or kind of shares issuable upon the exercise of Warrants and the Exercise Price of such shares
after such adjustment, the facts requiring such adjustment and the computation by which adjustment was made, and (ii) cause the
Warrant Agent to give written notice to each Holder in the manner provided in Section 9.2 below, of the record date or the
effective date of the event. Failure to give such notice, or any defect therein, shall not affect the legality or validity of such
event. The Warrant Agent shall be fully protected in relying upon any such written notice delivered in accordance with this Section
5.5, and on any adjustment therein contained, and shall not be deemed to have knowledge of any such adjustment unless and until
it shall have received such written notice. Notwithstanding anything to the contrary contained herein, the Warrant Agent shall
have no duty or obligation to investigate or confirm whether the information contained in any such written notice complies with
the terms of this Agreement or any other document. The Warrant Agent shall have no duty to determine when an adjustment under this
Article V should be made, how any such adjustment should be calculated, or the amount of any such adjustment.

 

Section 5.6           Deferral
or Exclusion of Certain Adjustments; Par Value. No adjustment to the Exercise Price or the number of Warrant Exercise Shares
shall be required hereunder unless such adjustment together with other adjustments carried forward as provided below, would result
in an increase or decrease of at least one percent (1%) of the applicable Exercise Price or the number of Warrant Exercise Shares;
provided, that any adjustments which by reason of this Section 5.6 are not required to be made shall be carried forward
and taken into account in any subsequent adjustment and in any Organic Change. Subject to Section 4.5(b), no adjustment
need be made for a change in the par value of the shares of Common Stock. All calculations under this Section shall be made to
the nearest one one-thousandth (1/1,000) of one cent ($0.01) or to the nearest one one-thousandth (1/1,000) of a share, as the
case may be. Without limiting Section 4.5(b), if an adjustment in Exercise Price made hereunder would reduce the Exercise Price
to an amount below par value of the Common Stock, then such adjustment in Exercise Price made hereunder shall reduce the Exercise
Price to the par value of the Common Stock.

 

    	 	18	 

     

    

 

Section 5.7           Form
of Warrant After Adjustments. The form of Warrant Certificate need not be changed because of any adjustments in the Exercise
Price or the number and/or kind of shares issuable upon exercise of the Warrants, and Warrant Certificates theretofore or thereafter
issued may continue to express the same price and number and kind of shares as are stated therein, as initially issued; provided,
that such adjustments in the Exercise Price or the number and/or kind of shares issuable upon exercise of the Warrants pursuant
to the terms of this Agreement shall nonetheless have effect upon exercise of the Warrants. The Company, however, may at any time
in its sole discretion make any change in the form of Warrant Certificate that it may deem appropriate to give effect to such adjustments
and that does not affect the substance of the Warrant Certificate or this Agreement (including the rights, duties, liabilities
or obligations of the Warrant Agent), and any Warrant Certificate thereafter issued, whether in exchange or substitution for an
outstanding Warrant Certificate, may be in the form so changed.

 

Section 5.8           Determination
Final. Any determination that the Company or the Board of Directors must make pursuant to this Article V shall be made in good
faith and shall be conclusive in the absence of manifest error or bad faith.

 

Article
VI

 

TRANSFER
AND EXCHANGE

OF WARRANTS

 

Section 6.1           Registration
of Transfers and Exchanges.

 

(a)          Transfer
and Exchange of Book-Entry Warrants. The Transfer and exchange of Book-Entry Warrants shall be effected through the Depositary
and its direct and indirect participants, in accordance with the practices and procedures therefor of the Depositary and such participants.

 

(b)          Exchange
of Book-Entry Warrants for Certificated Warrants or Direct Registration Warrants. If at any time:

 

(i)          the
Depositary for the Global Warrant Certificates notifies the Company that the Depositary is unwilling or unable to continue as Depositary
for the Global Warrant Certificates and a successor Depositary for the Global Warrant Certificates is not appointed by the Company
within 90 days after delivery of such notice; or

 

(ii)         the
Company, in its sole discretion, notifies the Warrant Agent in writing that it elects to exclusively cause the issuance of Certificated
Warrants or Direct Registration Warrants under this Agreement,

 

    	 	19	 

     

    

 

then upon written
instructions signed by an Appropriate Officer of the Company, the Warrant Agent shall register and issue Certificated Warrants,
or shall register Direct Registration Warrants, in an aggregate number equal to the number of Book-Entry Warrants represented by
the Global Warrant Certificates, in accordance with such written instructions. Such written instructions provided by the Company
shall state that the Certificated Warrants or Direct Registration Warrants issued in exchange for Book-Entry Warrants pursuant
to this Section 6.1(b) shall be registered in such names and in such amounts as the Depositary, pursuant to instructions
from its direct or indirect participants or otherwise, shall instruct the Warrant Agent.

 

(c)          Transfer
and Exchange of Certificated Warrants or Direct Registration Warrants. When Certificated Warrants or Direct Registration Warrants
are presented to the Warrant Agent with a written request:

 

(i)          to
register the Transfer of such Certificated Warrants or Direct Registration Warrants; or

 

(ii)         to
exchange such Certificated Warrants or Direct Registration Warrants for an equal number of Certificated Warrants or Direct Registration
Warrants, respectively, of other authorized denominations,

 

the Warrant
Agent shall register the Transfer or make the exchange, and in the case of Certificated Warrants shall issue such new Warrant Certificates,
as requested if its customary requirements for such transactions are met, provided, that (A) the Warrant Agent shall have
received (x) a written instruction of Transfer in form satisfactory to the Warrant Agent, duly executed by the Registered Holder
thereof or by his attorney, duly authorized in writing along with evidence of authority that may be required by the Warrant Agent,
including but not limited to, a signature guarantee from an eligible guarantor institution participating in a signature guarantee
program approved by the Securities Transfer Association, (y) a written order of the Company signed by an Appropriate Officer authorizing
such exchange and (z) in the case of Certificated Warrants, surrender of the Warrant Certificate or Certificate(s) representing
same duly endorsed for Transfer or exchange, and (B) if reasonably requested by the Company, the Company shall have received a
written opinion of counsel reasonably acceptable to the Company that such transfer is in compliance with the Securities Act.

 

(d)          Exchange
of Certificated Warrants or Direct Registration Warrants for Book-Entry Warrants. Certificated Warrants or Direct Registration
Warrants that are not subject to any Warrant Restrictions may be exchanged for Book-Entry Warrants upon satisfaction of the requirements
set forth below. Upon receipt by the Warrant Agent of appropriate written instruments of transfer with respect to such Certificated
Warrants or Direct Registration Warrants, in form satisfactory to the Warrant Agent, and in the case of Certificated Warrants,
surrender of the Warrant Certificate(s) representing same duly endorsed for Transfer or exchange, together with written instructions
directing the Warrant Agent to make, or to direct the Depositary to make, an endorsement on the Global Warrant Certificate to reflect
an increase in the number of Warrants represented by the Global Warrant Certificate equal to the number of Warrants represented
by such Certificated Warrants or Direct Registration Warrants, then the Warrant Agent shall cancel such Certificated Warrants or
Direct Registration Warrants on the Warrant Register and cause or direct the Depositary to cause, in accordance with the standing
instructions and procedures existing between the Depositary and the Warrant Agent, the number of Book-Entry Warrants represented
by the Global Warrant Certificate to be increased accordingly. If no Global Warrant Certificates are then outstanding, or if the
Global Warrant Certificates then outstanding cannot be used for such purposes, the Company shall issue and the Warrant Agent shall
countersign (by either manual or facsimile signature), a new Global Warrant Certificate representing the appropriate number of
Book-Entry Warrants. Any such transfer shall be subject to the Company’s prior written approval, which shall not be unreasonably
withheld, conditioned or delayed.

 

    	 	20	 

     

    

 

(e)          Restrictions
on Transfer and Exchange of Global Warrant Certificates. Notwithstanding any other provisions of this Agreement (other than
the provisions set forth in Section 6.1(f)), unless and until it is exchanged in whole for Certificated Warrants or Direct
Registration Warrants, a Global Warrant Certificate may not be transferred as a whole except by the Depositary to a nominee of
the Depositary or by a nominee of the Depositary to the Depositary or another nominee of the Depositary or by the Depositary or
any such nominee to a successor Depositary or a nominee of such successor Depositary.

 

(f)          Restrictions
on Transfer. No Warrants or Warrant Exercise Shares shall be sold, exchanged or otherwise Transferred in violation of the Securities
Act or state securities Laws or the Company’s articles of incorporation. If any Holder purports to Transfer Warrants to any
Person in a transaction that would violate the provisions of this Section 6.1(f), such Transfer shall be void ab initio
and of no effect.

 

(g)          Exchange
of Global Warrant Certificate. A Global Warrant Certificate may be exchanged for another Global Warrant Certificate of like
or similar tenor for purposes of complying with the practices and procedures of the Depositary.

 

(h)          Cancellation
of Global Warrant Certificate. At such time as all beneficial interests in a Global Warrant Certificate have either been exchanged
for Certificated Warrants or Direct Registration Warrants, redeemed, repurchased or cancelled, the Global Warrant Certificate shall
be returned to, or retained and cancelled pursuant to applicable Law by, the Warrant Agent, upon written instructions from the
Company satisfactory to the Warrant Agent.

 

Section 6.2           Obligations
with Respect to Transfers and Exchanges of Warrants.

 

(a)          All
Certificated Warrants or Direct Registration Warrants issued upon any registration of Transfer or exchange of Certificated Warrants
or Direct Registration Warrants, respectively, shall be the valid obligations of the Company, entitled to the same benefits under
this Agreement as the Certificated Warrants or Direct Registration Warrants surrendered upon such registration of Transfer or exchange.
No service charge shall be made to a Registered Holder for any registration, Transfer or exchange of any Certificated Warrants
or Direct Registration Warrants, but the Company may require payment of a sum sufficient to cover any stamp or other tax or other
charge that may be imposed on the Registered Holder in connection with any such exchange or registration of Transfer. The Warrant
Agent shall have no obligation to effect an exchange or register a Transfer unless and until it is satisfied that all such taxes
and/or charges have been paid.

 

    	 	21	 

     

    

 

(b)          So
long as the Depositary, or its nominee, is the registered owner of a Global Warrant Certificate, the Depositary or such nominee,
as the case may be, shall be considered by the Company, the Warrant Agent, and any agent of the Company or the Warrant Agent as
the sole owner or holder of the Warrants represented by such Global Warrant Certificate for all purposes under this Agreement (subject
to Sections 4.1(ii) and 4.3(d)(z)). Neither the Company nor the Warrant Agent, in its capacity as registrar for such
Warrants, will have any responsibility or liability for any aspect of the records relating to beneficial interests in a Global
Warrant Certificate or for maintaining, supervising or reviewing any records relating to such beneficial interests. Notwithstanding
the foregoing, nothing herein shall prevent the Company, the Warrant Agent or any agent of the Company or the Warrant Agent from
giving effect to any written certification, proxy, or other authorization furnished by the Depositary or impair the operation of
customary practices of the Depositary governing the exercise of the rights of a holder of a beneficial interest in a Global Warrant
Certificate.

 

(c)          Subject
to Section 6.1(c), and this Section 6.2, the Warrant Agent shall:

 

(i)          in
the case of Certificated Warrants, upon receipt of all information required to be delivered hereunder, from time to time register
the Transfer of any outstanding Certificated Warrants in the Warrant Register, upon delivery by the Registered Holder thereof,
at the Warrant Agent’s office designated for such purpose, of the Warrant Certificate representing such Certificated Warrants,
properly endorsed for transfer, by the Registered Holder thereof or by the duly appointed legal representative thereof or by a
duly authorized attorney; and upon any such registration of Transfer, a new Warrant Certificate shall be issued to the transferee.

 

(ii)         in
the case of Direct Registration Warrants, upon receipt of all information required to be delivered hereunder, from time to time
register the Transfer of any outstanding Direct Registration Warrants in the Warrant Register, upon delivery by the Registered
Holder thereof, at the Warrant Agent’s office designated for such purpose, of a form of assignment substantially in the form
of Exhibit C hereto, properly completed and duly executed by the Registered Holder thereof or by the duly appointed legal
representative thereof or by a duly authorized attorney; and upon any such registration of Transfer, a new Direct Registration
Warrant shall be issued to the transferee.

 

Section 6.3           Fractional
Warrants. The Warrant Agent shall not effect any registration of Transfer or exchange which will result in the issuance of
a fraction of a Warrant.

 

Section 6.4           Restricted
Warrants; Legends. Notwithstanding anything contained in this Agreement, the Company will cause any Warrants that are distributed
or issued under the Plan of Reorganization to any Person that the Company, in its sole discretion, determines may be deemed an
“underwriter” under section 1145(b) of the Bankruptcy Code, to be issued as Certificated Warrants represented by Warrant
Certificates bearing a legend in substantially the following form, or as Direct Registration Warrants with a notation to a similar
effect on the Warrant Register:

 

    	 	22	 

     

    

 

THE WARRANTS
REPRESENTED BY THIS CERTIFICATE WERE ISSUED IN RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) AND HAVE NOT BEEN REGISTERED PURSUANT TO THE SECURITIES ACT OR OTHER
APPLICABLE SECURITIES LAWS. THESE WARRANTS (AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE THEREOF) MAY NOT BE TRANSFERRED,
SOLD, ASSIGNED, OR OTHERWISE DISPOSED EXCEPT (A) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE
STATE SECURITIES LAWS OR (B) PURSUANT TO AN EXEMPTION FROM REGISTRATION THEREUNDER.

 

The Warrant Exercise
Shares issued upon exercise of any such Warrants shall be issued in the form of registered stock certificates bearing a legend
indicating that transfer may be restricted under United States federal and state securities laws or in the form of an electronic
entry on the stock register maintained by the transfer agent for the Common Stock with a notation to a similar effect.

 

The Holder (or its transferee, as applicable)
of any such Warrants or Warrant Exercise Shares, as applicable, shall be entitled to receive from the Company, without expense,
new securities of like tenor not bearing the restrictive legend set forth above when (a) all such Warrants or Warrant Exercise
Shares, as applicable, shall have been (i) effectively registered under the Securities Act and disposed of in accordance with a
registration statement covering such securities or (ii) disposed of pursuant to the provisions of Rule 144 or any comparable rule
under the Securities Act or (b) when, in the written reasonable opinion of independent counsel for such Holder (which counsel shall
be experienced in Securities Act matters and which counsel and opinion shall be reasonably satisfactory to the Company), such restrictions
are no longer required in order to insure compliance with the Securities Act (including, without limitation, when all such Warrants
or Warrant Exercise Shares, as applicable, could be sold in a single transaction pursuant to Rule 144 without restriction as to
volume or manner of sale).

 

Article
VII

 

OTHER
PROVISIONS RELATING TO RIGHTS OF HOLDERS OF WARRANTS

 

Section 7.1           No
Rights or Liability as Stockholder. Nothing contained herein shall be construed as conferring upon the Holder or his, her or
its transferees the right to vote or to receive dividends or to consent or to receive notice as a stockholder in respect of any
meeting of stockholders for the election of directors of the Company or of any other matter, or any rights whatsoever as stockholders
of the Company. The vote or consent of any Holder shall not be required with respect to any action or proceeding of the Company
and no Holder shall have any right not expressly conferred hereunder or under, or by applicable Law with respect to, the Warrants
held by such Holder. No Holder, by reason of the ownership or possession of a Warrant, shall have any right to receive any cash
dividends, stock dividends, allotments or rights or other distributions paid, allotted or distributed or distributable to the holders
of Common Stock prior to, or for which the relevant record date preceded, the date of the exercise of such Warrant. No provision
thereof and no mere enumeration therein of the rights or privileges of the Holder shall give rise to any liability of such Holder
for the Exercise Price hereunder or as a stockholder of the Company, whether such liability is asserted by the Company or by creditors
of the Company.

 

    	 	23	 

     

    

 

Section 7.2           Notice
to Registered Holders. The Company shall give notice to Registered Holders by regular
mail, and prompt written notice thereof to the Warrant Agent, if at any time prior to the expiration or exercise in full of the
Warrants, any of the following events shall occur:

 

(a)           the payment
of any dividend payable in any securities upon shares of Common Stock or the making of any distribution (other than a regular quarterly
cash dividend) to all holders of Common Stock;

 

(b)           the issuance
to all holders of Common Stock of any additional shares of Common Stock or of rights, options or warrants to subscribe for or purchase
Common Stock or of any other subscription rights, options or warrants;

 

(c)           a Pro Rata
Repurchase Offer;

 

(d)           an Organic
Change;

 

(e)           a dissolution,
liquidation or winding up of the Company; or

 

(f)           any the
occurrence of any other event that would result in an adjustment to the Exercise Price or the number of Warrant Exercise Shares
issuable upon exercise of the Warrants under Article V.

 

Such giving of notice shall
be initiated at least ten (10) days prior to the date fixed as the record date or the date of closing of the Company’s stock
transfer books for the determination of the stockholders entitled to such dividend, distribution or subscription rights, or of
the stockholders entitled to vote on such Organic Change, dissolution, liquidation or winding up or the proposed effective date
of a Pro Rata Repurchase Offer or any other event that would result in an adjustment to the Exercise Price or the number of Warrant
Exercise Shares issuable upon exercise of the Warrants under Article V. Such notice shall specify such record date or the
date of closing the stock transfer books or proposed effective date, as the case may be. Failure to provide such notice shall not
affect the validity of any action taken. For the avoidance of doubt, no such notice (or the failure to provide it to any Holder)
shall supersede or limit any adjustment called for by Article V by reason of any event as to which notice is required by
this Section.

 

    	 	24	 

     

    

 

Section 7.3           Lost,
Stolen, Mutilated or Destroyed Warrant Certificates. If any Warrant Certificate
is lost, stolen, mutilated or destroyed, the Company may issue, and upon written request by the Company, the Warrant Agent shall
countersign (either by manual or facsimile signature), and deliver, in exchange and substitution for and upon cancellation of
the mutilated Warrant Certificate, or in lieu of and substitution for the Warrant Certificate lost, stolen or destroyed, a new
Warrant Certificate of like tenor in accordance with written instructions from the Company. In the case of Warrant Certificates
other than Global Warrant Certificates, the Warrant Agent shall require evidence reasonably satisfactory to it of the loss, theft
or destruction of such Warrant Certificate, and an open penalty surety bond satisfactory to it and holding the Company and the
Warrant Agent harmless, absent notice to Warrant Agent that such certificates have been acquired by a bona fide purchaser. Applicants
for such substitute Warrant Certificates shall also comply with such other regulations and pay such other charges as the Company
or the Warrant Agent may require.

 

Section 7.4           Cancellation
of Warrants 

. If the Company shall purchase or otherwise
acquire Warrants, such Warrants shall be cancelled and retired, in the case of Certificated Warrants or Direct Registration Warrants,
by appropriate notation on the Warrant Register, and, in the case of Book-Entry Warrants, in accordance with the practices and
procedures of the Depositary, including if required by such practices and procedure by appropriate notation on the applicable Global
Warrant Certificate.

 

Article
VIII

CONCERNING THE WARRANT AGENT AND OTHER MATTERS

 

Section 8.1           Resignation,
Removal, Consolidation or Merger of Warrant Agent.

 

(a)           Appointment
of Successor Warrant Agent. The Warrant Agent, or any successor to it hereafter appointed, may resign its duties and be discharged
from all further duties and liabilities hereunder after giving sixty (60) days’ notice in writing to the Company. If the
office of the Warrant Agent becomes vacant by resignation or incapacity to act or otherwise, the Company shall appoint in writing
a successor Warrant Agent in place of the Warrant Agent. If the Company shall fail to make such appointment within a period of
sixty (60) days after it has been notified in writing of such resignation or incapacity by the Warrant Agent or by the Registered
Holder of a Warrant, then the Registered Holder of any Warrant may apply to the Supreme Court of the State of New York for the
County of New York for the appointment of a successor Warrant Agent at the Company’s cost. The Company may, at any time and
for any reason at no cost to the Holders, remove the Warrant Agent and appoint a successor Warrant Agent by written instrument
signed by the Company and specifying such removal and the date when it is intended to become effective, one copy of which shall
be delivered to the Warrant Agent being removed and one copy to the successor Warrant Agent. Any successor Warrant Agent, whether
appointed by the Company or by such court, shall be a Person organized and existing under the Laws of the United States of America,
or any state thereunder, in good standing. After appointment, any successor Warrant Agent shall be vested with all the authority,
powers, rights, immunities, duties and obligations of its predecessor Warrant Agent with like effect as if originally named as
Warrant Agent hereunder, without any further act or deed; but if for any reason it becomes necessary or appropriate, the predecessor
Warrant Agent shall execute and deliver, at the expense of the Company, an instrument transferring to such successor Warrant Agent
all the authority, powers, rights, immunities, duties and obligations of such predecessor Warrant Agent hereunder; and upon request
of any successor Warrant Agent, the Company shall make, execute, acknowledge and deliver any and all instruments in writing for
more fully and effectually vesting in and confirming to such successor Warrant Agent all such authority, powers, rights, immunities,
duties and obligations.

 

    	 	25	 

     

    

 

(b)           Notice
of Successor Warrant Agent. In the event a successor Warrant Agent shall be appointed, the Company shall (i) give notice thereof
to the predecessor Warrant Agent and the transfer agent for the Common Stock not later than the effective date of any such appointment,
and (ii) cause written notice thereof to be delivered to each Registered Holder at such Registered Holder’s address appearing
on the Warrant Register. Failure to give any notice provided for in this Section 8.1(b) or any defect therein shall not
affect the legality or validity of the removal of the Warrant Agent or the appointment of a successor Warrant Agent, as the case
may be.

 

(c)           Merger,
Consolidation or Name Change of Warrant Agent.

 

(i)           Any Person
into which the Warrant Agent may be merged or with which it may be consolidated or any Person resulting from any merger or consolidation
to which the Warrant Agent shall be a party shall be the successor Warrant Agent under this Agreement, without any further act
or deed, if such person would be eligible for appointment as a successor Warrant Agent under the provisions of Section 8.1(a).
If any of the Warrant Certificates have been countersigned but not delivered at the time such successor to the Warrant Agent succeeds
under this Agreement, any such successor to the Warrant Agent may adopt the countersignature of any previous Warrant Agent; and
if at that time any of the Warrant Certificates shall not have been countersigned, any successor to the Warrant Agent may countersign
such Warrant Certificates either in the name of the predecessor Warrant Agent or in the name of the successor Warrant Agent; and
in all such cases such Warrant Certificates shall have the full force provided in the Warrant Certificates and in this Agreement.

 

(ii)           If at
any time the name of the Warrant Agent is changed and at such time any of the Warrant Certificates have been countersigned but
not delivered, the Warrant Agent whose name has changed may adopt the countersignature under its prior name; and if at that time
any of the Warrant Certificates have not been countersigned, the Warrant Agent may countersign such Warrant Certificates either
in its prior name or in its changed name; and in all such cases such Warrant Certificates shall have the full force provided in
the Warrant Certificates and in this Agreement.

 

Section 8.2           Fees
and Expenses of Warrant Agent.

 

(a)           Remuneration.
The Company agrees to pay the Warrant Agent reasonable remuneration for its services as Warrant Agent as set forth in the fee proposal
between the Company and the Warrant Agent dated December 21, 2016 and will reimburse the Warrant Agent upon demand for all reasonable
and documented out-of-pocket expenses (including reasonable counsel fees and expenses), taxes and governmental charges and other
charges of any kind and nature incurred by the Warrant Agent in connection with the negotiation, preparation, delivery, administration,
execution, modification, waiver, delivery, enforcement or amendment of this of this Agreement and the exercise and performance
of its duties hereunder.

 

    	 	26	 

     

    

 

(b)           Further
Assurances. The Company agrees to perform, execute, acknowledge and deliver or cause to be performed, executed, acknowledged
and delivered all such further and other acts, instruments, and assurances as may reasonably be required by the Warrant Agent for
the carrying out or performing of the provisions of this Agreement.

 

Section 8.3           Duties
of Warrant Agent

(a)           Covered
Persons. References to the Warrant Agent in this Section 8.3 shall include the Warrant Agent and its affiliates,
principles, directors, officers, employees, agents, representatives, attorneys, accountants, advisors and other professionals.

 

(b)           Liability.

 

(i)           The Warrant
Agent shall not be liable for or by reason of any of the statements of fact or recitals contained in this Agreement, the Warrant
Statements or in the Warrant Certificates (except, in each case, its countersignature thereof) or be required to verify the same,
but all such statements and recitals are and shall be deemed to have been made by the Company only. The Warrant Agent shall not
be under any responsibility in respect of the validity or sufficiency of this Agreement or the execution and delivery hereof or
in respect of the validity or execution of any Warrant Certificate (except, in each case, its countersignature therefor); nor shall
the Warrant Agent be responsible for any breach by the Company of any covenant or condition contained in this Agreement; nor shall
the Warrant Agent be responsible for the making of any adjustment in the Exercise Price or the number and/or kind of shares issuable
upon the exercise of Warrants required under the provisions of Article V or be responsible for the manner, method or amount
of any such change or the ascertaining of the existence of facts that would require any such change; nor shall the Warrant Agent
by any act hereunder be deemed to make any representation or warranty as to the authorization or reservation of any Warrant Exercise
Shares to be issued pursuant to this Agreement or any Warrant or as to whether any Warrant Exercise Shares will, when issued, be
validly issued and fully paid and non-assessable. The Warrant Agent shall not be accountable or under any duty or responsibility
for the application by the Company of the proceeds of the issue and sale, or exercise, of the Warrants.

 

(ii)          The Warrant
Agent shall have no liability under, and no duty to inquire as to, the provisions of any agreement, instrument or document other
than this Agreement.

 

(iii)         The
Warrant Agent may rely on and shall incur no liability or responsibility to the Company, any Holder, or any other Person for any
action taken, suffered or omitted to be taken by it upon any notice, instruction, request, resolution, waiver, consent, order,
certificate, affidavit, statement, or other paper, document or instrument furnished to the Warrant Agent hereunder and believed
by it to be genuine and to have been signed, sent or presented by the proper party or parties. The Warrant Agent shall be under
no duty to inquire into or investigate the validity, accuracy or content of any such notice, instruction, request, resolution,
waiver, consent, order, certificate, affidavit, statement, or other paper, document or instrument. The Warrant Agent shall not
take any instructions or directions except those given in accordance with this Agreement.

 

    	 	27	 

     

    

 

(iv)         The Warrant
Agent shall act hereunder solely as agent for the Company and in a ministerial capacity and does not assume any obligation or relationship
of agency or trust with any of the Holders, and its duties shall be determined solely by the provisions hereof. The Warrant Agent
shall not be liable for any action taken, suffered or omitted to be taken in connection with this Agreement except to the extent
that a court of competent jurisdiction determines that its own gross negligence, willful misconduct or bad faith (as each is determined
by a final, nonappealable judgment) was the primary cause of any loss.

 

(v)         Anything
in this Agreement to the contrary notwithstanding, in no event shall the Warrant Agent be liable for any special, incidental, punitive,
indirect or consequential loss or damage of any kind whatsoever (including but not limited to lost profits), even if the Warrant
Agent has been advised of the likelihood of such loss or damage. Notwithstanding anything contained in this Agreement to the contrary,
any liability of the Warrant Agent under this Agreement, whether in contract, or in tort, or otherwise, shall be limited in the
aggregate to, and shall not exceed, an amount equal to the fees and charges, but not including reimbursable expenses, paid by the
Company to the Warrant Agent hereunder during the twelve (12) months immediately preceding the event for which recovery from the
Warrant Agent is being sought.

 

(vi)         All rights
and obligations contained in this Section 8.3 shall survive the termination of this Agreement and the resignation, replacement,
incapacity or removal of the Warrant Agent. All fees and expenses incurred by the Warrant Agent prior to the resignation, replacement,
incapacity or removal of the Warrant Agent shall be paid by the Company in accordance with this Section 8.3 of this Agreement
notwithstanding such resignation, replacement, incapacity or removal of the Warrant Agent.

 

(vii)        The
Warrant Agent shall not be under any liability for interest on any monies at any time received by it pursuant to the provisions
of this Agreement.

 

(viii)       In
no event shall the Warrant Agent be responsible or liable for any failure or delay in the performance of its obligations under
this Agreement arising out of or caused by, directly or indirectly, forces beyond its reasonable control, including without limitation
strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or
acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software or hardware) services.

 

    	 	28	 

     

    

 

(ix)           In the
event the Warrant Agent believes any ambiguity or uncertainty exists hereunder or in any notice, instruction, direction, request
or other communication, paper or document received by the Warrant Agent hereunder, the Warrant Agent, may, in its sole discretion,
refrain from taking any action, and shall be fully protected and shall not be liable in any way to the Company or any Holder or
other person or entity for refraining from taking such action, unless the Warrant Agent receives written instructions signed by
the Company which eliminates such ambiguity or uncertainty to the satisfaction of Warrant Agent.

 

(c)           Reliance
on Company Statement. Whenever in the performance of its duties under this Agreement, the Warrant Agent shall deem it necessary
or desirable that any fact or matter be proved or established by the Company prior to taking or suffering any action hereunder,
such fact or matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively
proved and established by a statement signed by an Appropriate Officer of the Company and delivered to the Warrant Agent. The Warrant
Agent may rely upon such statement for any action taken or suffered by it pursuant to the provisions of this Agreement. The Company
will perform, execute, acknowledge and deliver or cause to be performed, executed, acknowledged and delivered all such further
and other acts, instruments and assurances as may reasonably be required by the Warrant Agent for the carrying out or performing
by the Warrant Agent of the provisions of this Agreement.

 

(d)           Indemnity.
The Company agrees to indemnify, defend, protect and save the Warrant Agent and hold it harmless from and against any and all losses,
damages, claims, liabilities, penalties, judgments, settlements, actions, suits, proceedings, litigation, investigations, costs
or expenses, including without limitation reasonable fees and disbursements of counsel, that may be imposed on, incurred by, or
asserted against such Person, at any time, and in any way relating to or arising out of or in connection with, directly or indirectly,
the execution, delivery or performance of this Agreement, the enforcement of any rights or remedies under or in connection with
this Agreement, or as may arise by reason of any act, omission or error of such Person; provided, that no such Person shall
be entitled to be so indemnified, defended, protected, saved and kept harmless to the extent such loss was caused by its own gross
negligence, bad faith or willful misconduct, each as determined by a final judgment of a court of competent jurisdiction. Notwithstanding
the foregoing, the Company shall not be responsible for any settlement made without its written consent, which written consent
shall not be unreasonably conditioned, withheld or delayed.

 

(e)           Exclusions.
The Warrant Agent shall have no responsibility with respect to the validity of this Agreement or with respect to the validity or
execution of any Warrant (except, in each case, its countersignature thereof); nor shall it be responsible for any breach by the
Company of any covenant or condition contained in this Agreement; nor shall it be responsible to make any adjustments required
under the provisions of Article V hereof or responsible for the manner, method or amount of any such adjustment or the ascertaining
of the existence of facts that would require any such adjustment; nor shall it by any act hereunder be deemed to make any representation
or warranty as to the authorization or reservation of any Common Stock to be issued pursuant to this Agreement or any Warrant or
as to whether any Common Stock will, when issued, be valid and fully paid and non-assessable. The Warrant Agent will not be under
any duty or responsibility to ensure compliance with any applicable federal or state securities Laws in connection with the issuance,
transfer or exchange of Warrants.

 

    	 	29	 

     

    

 

(f)           The Warrant
Agent may execute and exercise any of the rights or powers hereby vested in it or perform any duty hereunder either itself or by
or through its attorneys, agents or employees, and the Warrant Agent shall not be answerable or accountable for any act, default,
neglect or misconduct of any such attorneys, agents or employees or for any loss to the Company resulting from such neglect or
misconduct, provided, that the Warrant Agent acts without gross negligence, willful misconduct or bad faith (each as determined
by a final judgment of a court of competent jurisdiction) in connection with the selection of such attorneys, agents or employees.

 

(g)           The Warrant
Agent may consult at any time with legal counsel satisfactory to it (who may be legal counsel for the Company) and the advice of
such counsel shall be full and complete authorization and protection to the Warrant Agent as to any action taken or omitted by
such parties in accordance with such advice.

 

(h)           The Warrant
Agent may buy, sell, or deal in any of the Warrants or other securities of the Company freely as though it was not Warrant Agent
under this Agreement. Nothing contained herein shall preclude the Warrant Agent from acting in any other capacity for the Company
or for any other Person.

 

(i)           The Warrant
Agent shall not be required to use or risk its own funds in the performance of any of its obligations or duties or the exercise
of any of its rights or powers, and shall not be required to take any action which, in the Warrant Agent’s sole and absolute
judgment, could involve it in expense or liability unless furnished with security and indemnity satisfactory to it.

 

Article
IX

MISCELLANEOUS PROVISIONS

 

Section 9.1           Binding
Effects; Benefits. This Agreement shall inure to the benefit of and shall be binding
upon the Company, the Warrant Agent and the Holders and their respective heirs, legal representatives, successors and assigns.
Nothing in this Agreement, expressed or implied, is intended to or shall confer on any person other than the Company, the Warrant
Agent and the Holders, or their respective heirs, legal representatives, successors or assigns, any rights, remedies, obligations
or liabilities under or by reason of this Agreement.

 

Section 9.2           Notices.
Any notice or other communication by any of the Company, the Warrant Agent or the Registered Holders to the other(s) which may
be, or is required to be, given hereunder shall be in writing and shall be sent by certified or regular mail (return receipt requested,
postage prepaid), by private national courier service, by personal delivery or by facsimile transmission. Such notice or communication
shall be deemed given (i) if mailed, two (2) days after the date of mailing, (ii) if sent by national courier service, one (1)
Business Day after being sent, (iii) if delivered personally, when so delivered, or (iv) if sent by facsimile transmission, on
the Business Day after such facsimile is transmitted, in each case as follows:

 

    	 	30	 

     

    

 

if to the Warrant Agent,
to:

 

Continental Stock Transfer & Trust Company

New York, New York 10004

17 Battery Place

Facsimile: (212) 616-7616

Attention: Margaret
Villani & Steven Vacante

 

if to the Company, to:

 

Energy XXI Gulf Coast, Inc.

1021 Main Street, Suite 2626

Houston, Texas 77002

Facsimile: (713) 351-3300

Attention: John D. Schiller, Jr.

 

with copies (which shall not constitute notice)
to:

 

Vinson & Elkins LLP

1001 Fannin Street

Suite 2500

Houston, TX 77002-6760

Facsimile: (713) 615-5234

Attention: Sarah K. Morgan

 

if to Registered
Holders, at their addresses as they appear in the Warrant Register and, if different, at the addresses appearing in the records
of the transfer agent or registrar for the Common Stock.

 

Section 9.3           Persons
Having Rights under this Agreement. Nothing in this Agreement expressed and nothing
that may be implied from any of the provisions hereof is intended, or shall be construed, to confer upon, or give to, any person
or corporation other than the parties hereto and the Holders, any right, remedy, or claim under or by reason of this Agreement
or of any covenant, condition, stipulation, promise, or agreement hereof. All covenants, conditions, stipulations, promises, and
agreements contained in this Agreement shall be for the sole and exclusive benefit of the parties hereto, their successors and
assigns and the Holders.

 

Section 9.4           Examination
of this Agreement. A copy of this Agreement, and of the entries in the Warrant
Register relating to such Registered Holder’s Warrants, shall be available at all reasonable times at an office designated
for such purpose by the Warrant Agent, for examination by the Registered Holder of any Warrant.

 

Section 9.5           Counterparts.
This Agreement may be executed in any number of original or facsimile or electronic PDF counterparts and each of such counterparts
shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.

 

    	 	31	 

     

    

 

Section 9.6           Effect
of Headings. The section headings herein are for convenience only and are not part
of this Agreement and shall not affect the interpretation hereof.

 

Section 9.7           Supplements,
Amendments and Waivers.

 

(a)           Subject
to Section 9.7(b) below, this agreement may not be amended except in writing signed by the Company and the Warrant Agent.

 

(b)           The Company
and the Warrant Agent may from time to time supplement or amend this Agreement or the Warrants without the approval of any Holder
in order to (i) cure any manifest error or other mistake in this Agreement or the Warrants, or to correct any provision contained
herein or in the Warrants that may be defective, (ii) evidence and provide for the acceptance of an appointment hereunder by a
successor Warrant Agent or (iii) make any other provisions in regard to matters or questions arising hereunder that the Company
may deem necessary or desirable and that shall not adversely affect, alter or change the interests of the Holders in any material
respect, or

 

(c)           The Company
and the Warrant Agent may from time to time supplement or amend this Agreement or the Warrants or waive compliance by the Company
with any provision of this Agreement or the Warrants with the prior written consent of Requisite Holders; provided, that
the consent of each Holder adversely affected thereby shall be required for any amendment that (i) reduces the term of the Warrants
(or otherwise modifies any provisions pursuant to which the Warrants may be terminated or cancelled), (ii) increases the Exercise
Price and/or decreases the number of Warrant Exercise Shares (or, as applicable, the amount of cash or such other securities and/or
assets or other property) deliverable upon exercise of the Warrants, other than such increases and/or decreases that are made pursuant
to Article V or (iii) modifies, in a manner adverse to the Holders generally, the material anti-dilution provisions set
forth in Article V. In addition, any term of a specific Warrant may be supplemented, amended or waived with the written
consent of the Company and the Holder of such Warrant.

 

(d)           It is not
necessary for Holders to approve the particular form of any proposed supplement, amendment or waiver, but is sufficient if their
consent approves the substance thereof. Notwithstanding anything to the contrary herein, upon the delivery of a certificate from
an Appropriate Officer which states that the proposed supplement, amendment or waiver is in compliance with the terms of this Section
9.7, the Warrant Agent shall execute such supplement, amendment or waiver; provided, that the Warrant Agent may, but
shall not be obligated to, execute any amendment, supplement or waiver that affects Warrant Agent’s rights, duties, immunities,
liabilities or obligations hereunder. Any supplement, amendment or waiver effected pursuant to and in accordance with the provisions
of this Section 9.7 shall be binding upon all Holders and upon each future Holder, the Company and the Warrant Agent. In
the event of any supplement, amendment or waiver, the Company shall give prompt notice thereof to all Registered Holders. Any failure
of the Company to give such notice or any defect therein shall not, however, in any way impair or affect the validity of any such
amendment.

 

    	 	32	 

     

    

 

Section 9.8           No
Inconsistent Agreements; No Impairment. The Company shall not, on or after the
date hereof, enter into any agreement with respect to its securities which conflicts with the rights granted to the Holders in
this Agreement. The Company represents and warrants to the Holders that the rights granted hereunder do not in any way conflict
with the rights granted to holders of the Company’s securities under any other agreements. The Company shall not, by amendment
of its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue
or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms
to be observed or performed hereunder by the Company, but will at all times in good faith assist in the carrying out of all the
provisions of the Warrants and in the taking of all such action as may be necessary in order to preserve the exercise rights of
the Holders against impairment.

 

Section 9.9           Integration/Entire
Agreement. This Agreement is intended by the parties as a final expression of their
agreement and intended to be a complete and exclusive statement of the agreement and understanding of the Company, the Warrant
Agent and the Holders in respect of the subject matter contained herein. There are no restrictions, promises, warranties or undertakings,
other than those set forth or referred to herein, with respect to the Warrants. This Agreement supersedes all prior agreements
and understandings between the parties with respect to the Warrants.

 

Section 9.10         Governing
Law; Exclusive Jurisdiction. This Agreement and each Warrant issued hereunder shall
be deemed to be a contract made under the Laws of the State of New York and for all purposes shall be governed by and construed
in accordance with the Laws of such State. Each party hereto consents and submits to the exclusive jurisdiction of the courts
of the State of New York located in New York County and of the U.S. federal courts located in the Southern District of New York
in connection with any action or proceeding brought against it that arises out of or in connection with, that is based upon, or
that relates to this Agreement or the transactions contemplated hereby. In connection with any such action or proceeding in any
such court, each party hereto hereby waives personal service of any summons, complaint or other process and hereby agrees that
service thereof may be made in accordance with the procedures for giving notice set forth in Section 9.2 hereof. Each party
hereto hereby waives any objection to jurisdiction or venue in any such court in any such action or proceeding and agrees not
to assert any defense based on forum non conveniens or lack of jurisdiction or venue in any such court in any such action
or proceeding.

 

Section 9.11          Termination.
This Agreement will terminate on the earlier of (i) such date when all Warrants have been exercised with respect to all shares
subject thereto, or (ii) the expiration of the Exercise Period. The provisions of Section 8.3 and this Article IX
shall survive such termination and the resignation, replacement or removal of the Warrant Agent.

 

Section 9.12         Waiver
of Trial by Jury. Each party hereto, including each Holder by its receipt of a
Warrant, hereby irrevocably and unconditionally waives the right to a trial by jury in any action, suit, counterclaim or other
proceeding (whether based on contract, tort or otherwise) arising out of, connected with or relating to this Agreement and the
transactions contemplated hereby.

 

    	 	33	 

     

    

 

Section 9.13         Remedies.
The Company hereby agrees that, in the event that the Company violates any provisions of the Warrants (including the obligation
to deliver shares of Common Stock upon the exercise thereof), the remedies at law available to the Holder of such Warrant may
be inadequate. In such event, the Requisite Holders and, other than in the event the Company fails to deliver Warrant Exercise
Shares upon a Holder’s exercise of its Warrants or any other violation of Section 9.7(c) with respect to such Holder (which
shall not require the consent of the Requisite Holders), with the prior written consent of the Requisite Holders, the Holder of
such Warrants, shall have the right, in addition to all other rights and remedies any of them may have, to specific performance
and/or injunctive or other equitable relief to enforce the provisions of this Agreement and the Warrants.

 

Section 9.14        Bank
Accounts. All funds received by the Warrant Agent under this Agreement that are
to be distributed or applied by the Warrant Agent in the performance of Services (the “Funds”) shall be held
by the Warrant Agent as agent for the Company and deposited in one or more bank accounts to be maintained by the Warrant Agent
in its name as agent for the Company. Until paid pursuant to the terms of this Agreement, the Warrant Agent will hold the Funds
through such accounts in: deposit accounts of commercial banks with Tier 1 capital exceeding $1 billion or with an average rating
above investment grade by S&P (LT Local Issuer Credit Rating), Moody’s (Long Term Rating) and Fitch Ratings, Inc. (LT
Issuer Default Rating) (each as reported by Bloomberg Finance L.P.). The Warrant Agent shall have no responsibility or liability
for any diminution of the Funds that may result from any deposit made by the Warrant Agent in accordance with this paragraph,
including any losses resulting from a default by any bank, financial institution or other third party. The Warrant Agent may from
time to time receive interest, dividends or other earnings in connection with such deposits. The Warrant Agent shall not be obligated
to pay such interest, dividends or earnings to the Company, any holder or any other party.

 

Section 9.15         Severability.
In the event that any one or more of the provisions contained in this Agreement, or the application thereof in any circumstances,
is held invalid, illegal or unenforceable, the validity, legality and enforceability of any such provisions in every other respect
and of the remaining provisions contained herein shall not be affected or impaired thereby; provided, that if any such
excluded provision shall adversely affect the rights, immunities, duties or obligations of the Warrant Agent, the Warrant Agent
shall be entitled to immediately resign.

 

Section 9.16         Confidentiality 

. The Warrant Agent and the Company
agree that the Warrant Register and personal, non-public warrant holder information, which are exchanged or received pursuant to
the negotiation or carrying out of this Agreement, shall remain confidential and shall not be voluntarily disclosed to any
other person, except as may be required by law, including, without limitation, pursuant to subpoenas from state or federal government
authorities (e.g., in divorce and criminal actions), or pursuant to the requirements of the SEC.

 

    	 	34	 

     

    

 

Section 9.17         Warrantholder
Actions.

 

(a)           Any notice,
consent to amendment, supplement or waiver provided by this Agreement to be given by a Holder (an “act”) may be evidenced
by an instrument signed by the Holder delivered to the Warrant Agent.

 

(b)           Any act
by the Holder of any Warrant binds that Holder and every subsequent Holder of a Warrant certificate that evidences the same Warrant
of the acting Holder, even if no notation thereof appears on the Warrant certificate. Subject to paragraph (c), a Holder may revoke
an act as to its Warrants, but only if the Warrant Agent receives the notice of revocation before the date the amendment or waiver
or other consequence of the act becomes effective.

 

(c)           The Company
may, but is not obligated to, fix a record date for the purpose of determining the Holders entitled to act with respect to any
amendment or waiver or in any other regard. If a record date is fixed, those Persons that were Holders at such record date and
only those Persons will be entitled to act, or to revoke any previous act, whether or not those Persons continue to be Holders
after the record date.

 

[Signature
Page Follows]

 

    	 	35	 

     

    

 

IN WITNESS WHEREOF, this
Agreement has been duly executed by the undersigned parties hereto as of the date first above written.

 

	 	Energy XXI Gulf Coast, inc.
	 	 	 
	 	By:	/s/ Hugh A. Menown
	 	Name:	Hugh A. Menown
	 	Title:	Executive Vice President, Chief Accounting Officer

 

[Signature Page to Warrant Agreement]

 

    	 	 	 

     

    

 

	 	Continental stock transfer & trust company, as Warrant Agent
	 	 	 
	 	By:	/s/ Michael Mullings
	 	Name:	Michael Mullings  
	 	Title:	Vice President

 

[Signature Page to Warrant Agreement]

 

    	 	 	 

     

    

 

EXHIBIT A-1

 

FACE OF GLOBAL WARRANT CERTIFICATE

 

VOID AFTER 5:00 P.M., NEW YORK CITY TIME, ON
DECEMBER 30, 2021

 

This Global Warrant Certificate is held by
The Depository Trust Company (the “Depositary”) or its nominee in custody for the benefit of the beneficial
owners hereof, and is not transferable to any person under any circumstances except that (i) this Global Warrant Certificate may
be exchanged in whole but not in part pursuant to Section 6.1(g) of the Warrant Agreement, (ii) this Global Warrant Certificate
may be delivered to the Warrant Agent for cancellation pursuant to Section 6.1(h) of the Warrant Agreement and (iii) this Global
Warrant Certificate may be transferred to a successor Depositary with the prior written consent of the Company.

 

Unless this Global Warrant Certificate is presented
by an authorized representative of the Depositary to the Company or the Warrant Agent for registration of transfer, exchange or
payment and any certificate issued is registered in the name of Cede & Co. or such other entity as is requested by an authorized
representative of the Depositary (and any payment hereon is made to Cede & Co. or to such other entity as is requested by an
authorized representative of the Depositary), any transfer, pledge or other use hereof for value or otherwise by or to any person
is wrongful because the registered owner hereof, Cede & Co., has an interest herein.

 

Transfers of this Global Warrant Certificate
shall be limited to transfers in whole, but not in part, to nominees of the Depositary or to a successor thereof or such successor’s
nominee.

 

No registration or transfer of the securities
issuable pursuant to the Warrant will be recorded on the books of the Company until such provisions have been complied with.

 

    	 	 	 

     

    

 

THE SECURITIES REPRESENTED BY THIS GLOBAL WARRANT
CERTIFICATE (INCLUDING THE SECURITIES ISSUABLE UPON EXERCISE OF THE WARRANT) ARE SUBJECT TO ADDITIONAL AGREEMENTS SET FORTH IN
THE WARRANT AGREEMENT DATED AS OF DECEMBER 30, 2016, BY AND BETWEEN THE COMPANY AND THE WARRANT AGENT (THE “WARRANT AGREEMENT”).

 

THIS WARRANT WILL BE VOID IF NOT EXERCISED PRIOR
TO

5:00 P.M., NEW YORK CITY TIME, ON DECEMBER 30, 2021

 

WARRANT TO PURCHASE

 

2,119,889 SHARES OF COMMON STOCK OF

 

ENERGY XXI GULF COAST, INC.*

 

CUSIP # 29276K 119

ISSUE DATE: December 30, 2016

 

No. W-1

 

This certifies that, for value received, Cede
& Co. and its registered assigns (collectively, the “Registered Holder”), is entitled to purchase from reorganized
Energy XXI Gulf Coast, Inc., a Delaware corporation (the “Company”), subject to the terms and conditions hereof,
at any time before 5:00 p.m., New York time, on December 30, 2021, the number of fully paid and non-assessable shares of Common
Stock, par value $0.01 per share (“Common Stock”) of the Company set forth above at the Exercise Price (as defined
in the Warrant Agreement). The Exercise Price and the number and kind of shares purchasable hereunder are subject to adjustment
from time to time as provided in Article V of the Warrant Agreement. The initial Exercise Price shall be $43.66.

 

This Warrant Certificate shall not be valid unless
countersigned by the Warrant Agent.

 

 

		*	Exercisable for 2,119,889 shares of Common Stock for all Warrants in the aggregate, subject to adjustment in accordance with
Article V of the Warrant Agreement.

 

    	 	 	 

     

    

 

IN WITNESS WHEREOF, this Warrant has been duly
executed by the Company under its corporate seal as of the 30th day of December, 2016.

 

	 	 	ENERGY XXI GULF COAST, INC.
	 	 	 	 
	 	 	By:	 
	 	 	 	 
	 	 	Print Name:	Hugh A. Menown
	 	 	 	 
	 	 	Title:	Executive Vice President, Chief Accounting Officer
	 	 	 	 
	 	 	Attest:	 

	Continental Stock Transfer & Trust Company, as Warrant Agent	 	 
	 	 	 	 
	By:	 	 	 
	 	Name: Michael Mullings	 	 
	 	Title: Vice President	 	 

 

Address of Registered Holder for Notices (until
changed in accordance with this Warrant):

Cede & Co.

55 Water Street

New York, New York 10041

 

REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS
OF THIS GLOBAL WARRANT CERTIFICATE SET FORTH ON THE REVERSE HEREOF. SUCH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME
EFFECT AS THOUGH FULLY SET FORTH AT THIS PLACE.

 

    	 	 	 

     

    

 

FORM OF REVERSE OF GLOBAL WARRANT CERTIFICATE

 

The Warrant evidenced by this Global Warrant Certificate
is a part of a duly authorized issue of Warrants to purchase 2,119,889¤ shares of Common Stock issued pursuant to the Warrant
Agreement, a copy of which may be inspected at the office of the Warrant Agent designated for such purpose. The Warrant Agreement
hereby is incorporated by reference in and made a part of this instrument and is hereby referred to for a description of the rights,
limitation of rights, obligations, duties and immunities thereunder of the Warrant Agent, the Company and the Registered Holders
of the Warrants. All capitalized terms used on the face of this Warrant herein but not defined that are defined in the Warrant
Agreement shall have the meanings assigned to them therein.

 

The Company shall not be required to issue fractions
of Common Stock or any certificates that evidence fractional Common Stock.

 

No Warrants may be sold, exchanged or otherwise
transferred in violation of the Securities Act or state securities laws.

 

This Warrant does not entitle the Registered Holder
to any of the rights of a stockholder of the Company.

 

The Company and Warrant Agent may deem and treat
the Registered Holder hereof as the absolute owner of this Warrant Certificate (notwithstanding any notation of ownership or other
writing hereon made by anyone) for the purpose of any exercise hereof (subject to Section 4.3(d)(z) of the Warrant Agreement) and
for all other purposes (subject to Section 4.1(ii) of the Warrant Agreement), and neither the Company nor the Warrant Agent shall
be affected by any notice to the contrary.

 

 

		¤	Exercisable for 2,119,889 shares of Common Stock for all Warrants in the aggregate, subject to adjustment in accordance with
Article V of the Warrant Agreement.

  

    	 	 	 

     

    

 

EXHIBIT A-2

 

THE SECURITIES REPRESENTED BY THIS WARRANT CERTIFICATE
(INCLUDING THE SECURITIES ISSUABLE UPON EXERCISE OF THE WARRANT) ARE SUBJECT TO ADDITIONAL AGREEMENTS SET FORTH IN THE WARRANT
AGREEMENT DATED AS OF DECEMBER 30, 2016, BY AND BETWEEN THE COMPANY AND THE WARRANT AGENT (THE “WARRANT AGREEMENT”).

 

	Certificate Number  ________________	Warrants ___________
	 	CUSIP  29276K 119
	This certifies that	 
	is the holder of	 

 

WARRANTS TO PURCHASE COMMON STOCK OF

ENERGY XXI GULF COAST, INC.

 

transferable on the books
of the Company by the holder hereof in person or by duly authorized attorney upon surrender of the certificate properly endorsed.
Each Warrant entitles the holder and its registered assigns (collectively, the “Registered Holder”) to purchase
by exercise from reorganized Energy XXI Gulf Coast, Inc., a Delaware corporation (the “Company”), subject to
the terms and conditions hereof, at any time before 5:00 p.m., New York time, on December 30, 2021, one fully paid and non-assessable
share of common stock, par value $0.01 per share (“Common Stock”) of the Company at the Exercise Price (as defined
in the Warrant Agreement). The Exercise Price and the number and kind of shares purchasable hereunder are subject to adjustment
from time to time as provided in Article V of the Warrant Agreement. The initial Exercise Price shall be $43.66.

 

This certificate is not valid
unless countersigned and registered by the Warrant Agent.

 

WITNESS the facsimile
seal of the Company and the facsimile signatures of its duly authorized officers.

 

	 	 	DATED
	 	 	 
	Authorized Officer	 	 
	 	 	 
	Attest:	 	
        COUNTERSIGNED AND REGISTERED

         

        CONTINENTAL STOCK TRANSFER & TRUST COMPANY, AS WARRANT AGENT

         

	 	 	By  	 
	Secretary	 	AUTHORIZED SIGNATURE

  

    	 	 	 

     

    

 

FORM OF REVERSE OF WARRANT

ENERGY XXI GULF COAST, INC.

 

The Warrants evidenced by this Warrant Certificate
are a part of a duly authorized issue of Warrants to purchase 2,119,889 shares of Common Stock issued pursuant to the Warrant Agreement,
as dated December 30, 2016 between reorganized Energy XXI Gulf Coast, Inc. and Continental Stock Transfer & Trust Company,
a New York corporation, as warrant agent (together with its successors and assigns, the “Warrant Agent” and
the agreement, the “Warrant Agreement”), a copy of which may be inspected at the office of the Warrant Agent
designated for such purpose. The Warrant Agreement is incorporated by reference in and made a part of this instrument and is hereby
referred to for a description of the rights, limitation of rights, obligations, duties and immunities thereunder of the Warrant
Agent, the Company and the Registered Holders of the Warrants. All capitalized terms used in this Warrant Certificate but not defined
that are defined in the Warrant Agreement shall have the meanings assigned to them therein.

 

The Company shall not be required to issue
fractions of Common Stock or any certificates that evidence fractional Common Stock. No Warrants may be sold, exchanged or otherwise
transferred in violation of the Securities Act or state securities laws. The Warrants represented by this Warrant Certificate do
not entitle the Registered Holder to any of the rights of a stockholder of the Company. The Company and Warrant Agent may deem
and treat the Registered Holder hereof as the absolute owner of this Warrant Certificate (notwithstanding any notation of ownership
or other writing hereon made by anyone) for the purpose of any exercise hereof and for all other purposes, and neither the Company
nor the Warrant Agent shall be affected by any notice to the contrary.

 

    	 	 	 

     

    

 

EXHIBIT B-1

 

EXERCISE FORM FOR REGISTERED HOLDERS HOLDING
WARRANT CERTIFICATES

(To be executed upon exercise of Warrants)

 

The undersigned Registered Holder of this Warrant
Certificate, being the holder of Warrants of reorganized Energy XXI Gulf Coast, Inc. (the “Company”), issued
pursuant to that certain Warrant Agreement, as dated December 30, 2016 (the “Warrant Agreement”), by and among
the Company, and Continental Stock Transfer & Trust Company, a New York corporation, as warrant agent (together with its successors
and assigns, the “Warrant Agent”) hereby irrevocably elects to exercise the number of Warrants indicated below,
for the purchase of the number of shares of Common Stock, par value $0.01 per share (“Common Stock”) indicated
below and (check one):

 

		 ̈	herewith tenders payment for _______ of the Warrant Exercise Shares to the order of the Company
in the amount of $_________ in accordance with the terms of the Warrant Agreement; or

 

		 ̈	herewith tenders _______ Warrants pursuant to the cashless exercise provisions of Section 4.3(b)
of the Warrant Agreement. This exercise and election shall be immediately effective.

 

The undersigned requests that the Warrant Exercise
Shares, or the net number of shares of Common Stock issuable upon exercise of the Warrants pursuant to the cashless exercise provisions
of Section 4.3(b) of the Warrant Agreement, be issued in the name of the undersigned Holder or as otherwise indicated below:

 

	 	Name	 
	 	Address	 
	 	 	 

 

If said number of Warrant Exercise Shares shall
not be all the Warrant Exercise Shares issuable upon exercise of the Warrant, the undersigned requests that a new Warrant Certificate
representing the balance of such Warrant shall be issued in the name of the undersigned Holder or as otherwise indicated below
and be delivered to the address indicated below:

	 	Name	 
	 	Address	 
	 	 	 

 

	 	Delivery Address (if different)
	 	 	 
	 	 	 

 

Dated: ____________, 20___           HOLDER

[___________________]

 

By ____________________

Name:

Title:

 

    	 	 36	 

     

    

EXHIBIT B-2

 

EXERCISE FORM FOR REGISTERED HOLDERS HOLDING
DIRECT REGISTERED WARRANTS

(To be executed upon exercise of Warrants)

 

The undersigned Holder, being the holder of Warrants
of reorganized Energy XXI Gulf Coast, Inc. (the “Company”), issued pursuant to that certain Warrant Agreement,
as dated December 30, 2016 (the “Warrant Agreement”), by and among reorganized the Company, and Continental
Stock Transfer & Trust Company, a New York corporation, as warrant agent (together with their respective successors and assigns,
the “Warrant Agent”), hereby irrevocably elects to exercise the number of Warrants indicated below, for the
purchase of the number of shares of Common Stock, par value $0.01 per share (“Common Stock”) indicated below
and (check one):

 

		 ̈	herewith tenders payment for _______ of the Warrant Exercise Shares to the order of the Company
in the amount of $_________ in accordance with the terms of the Warrant Agreement; or

 

		 ̈	herewith tenders _______ Warrants pursuant to the cashless exercise provisions of Section 4.3(b)
of the Warrant Agreement. This exercise and election shall be immediately effective.

 

The undersigned requests that the Warrant Exercise
Shares, or the net number of shares of Common Stock issuable upon exercise of the Warrants pursuant to the cashless exercise provisions
of Section 4.3(b) of the Warrant Agreement, be issued in the name of the undersigned Holder or as otherwise indicated below:

 

	 	Name	 
	 	Address	 

 

If said number of Warrant Exercise Shares shall
not be all the Warrant Exercise Shares issuable upon exercise of the Warrant, the undersigned requests that a new Warrant representing
the balance of such Warrant shall be issued in the name of the undersigned Holder or as otherwise indicated below and that a Warrant
Statement reflecting such balance be delivered to the address indicated below:

 

	 	Name	 
	 	Address	 
	 	 	 

 

	 	Delivery Address (if different)
	 	 	 
	 	 	 

 

 

	Dated: ____________, 20___	HOLDER
	 	 	[___________________]
	 	 	By  	 
	 	 	Name:	 
	 	 	Title:	 

 

    	 	 	 

     

    

EXHIBIT C

 

FORM OF ASSIGNMENT

FOR REGISTERED HOLDERS

HOLDING DIRECT REGISTRATION WARRANTS

(To be executed only upon assignment of Warrants)

 

For value received, the undersigned Holder
of Warrants of reorganized Energy XXI Gulf Coast, Inc. (the “Company”), issued pursuant to that certain Warrant
Agreement, as dated December 30, 2016 (the “Warrant Agreement”), by and among reorganized the Company, and Continental
Stock Transfer & Trust Company, a New York corporation, as warrant agent (together with its successors and assigns, the “Warrant
Agent”), hereby sells, assigns and transfers unto the Assignee(s) named below the number of Warrants listed opposite
the respective name(s) of the Assignee(s) named below, and all other rights of the Holder under said Warrants, and does hereby
irrevocably constitute and appoint _____________________________ attorney, to transfer said Warrants, as and to the extent set
forth below, on the Warrant Register maintained for the purpose of registration thereof, with full power of substitution in the
premises:

 

	Name(s) of Assignee(s)	 	Address of Assignee(s)	 	Number of Warrants
		 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 

 

	Dated:  ______ , 20__	 	Signature:  ____________________________	 	 
	 	 	Name:  _______________________________	 	 

 

Note: The above signature and name should correspond
exactly with the name of the Holder of the Warrants as it appears on the Warrant Register.

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