Document:

Exhibit 10.31

 

EXECUTION VERSION

 

	
         

        CREDIT AGREEMENT

         

        dated as of

         

        August 27, 2014

         

        among

         

        AMERICAN EAGLE ENERGY CORPORATION,

         

        the Lenders that are from time to time parties
        hereto,

         

        SUNTRUST BANK,

         

        as Administrative Agent and Issuing Bank

         

        

 

         

        SUNTRUST ROBINSON HUMPHREY, INC.,

        as Bookrunner and Sole Lead Arranger

          

 

    	 

    	 

    

 

Table
of Contents

 

	 	 	Page
	 	 	 
	ARTICLE I	Definitions	1
	Section 1.1	Defined Terms	1
	Section 1.2	Classification of Loans and Borrowings	30
	Section 1.3	Terms Generally; Rules of Construction	31
	Section 1.4	Accounting Terms and Determinations; GAAP	31
	Section 1.5	Oil and Gas Definitions	32
	Section 1.6	Time of Day	32
	Section 1.7	Designation and Conversion of Restricted and Unrestricted Subsidiaries	32
	 	 	 
	ARTICLE II	The Credits	33
	Section 2.1	Commitments	33
	Section 2.2	Loans and Borrowings	34
	Section 2.3	Requests for Borrowings	35
	Section 2.4	Borrowing Base	36
	Section 2.5	Letters of Credit	40
	Section 2.6	Funding of Borrowings	45
	Section 2.7	Interest Elections	45
	Section 2.8	Termination and Reduction of Aggregate Maximum Credit Amounts	46
	Section 2.9	Repayment of Loans; Evidence of Debt	47
	Section 2.10	Prepayment of Loans	48
	Section 2.11	Fees	50
	Section 2.12	Interest	51
	Section 2.13	Alternate Rate of Interest	52
	Section 2.14	Increased Costs	52
	Section 2.15	Change in Legality	54
	Section 2.16	Break Funding Payments	54
	Section 2.17	Taxes	55
	Section 2.18	Payments Generally	59
	Section 2.19	Pro Rata Treatment; Sharing of Set-offs	59
	Section 2.20	Mitigation Obligations; Replacement of Lenders	60

 

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Table
of Contents

(continued)

 

	 	 	Page
	 	 	 
	Section 2.21	Cash Collateral	62
	Section 2.22	Defaulting Lenders	63
	Section 2.23	Disposition of Proceeds	65
	 	 	 
	ARTICLE III	Representations and Warranties	65
	Section 3.1	Organization; Powers	65
	Section 3.2	Authorization; Enforceability	66
	Section 3.3	Governmental Approvals; No Conflicts	66
	Section 3.4	Financial Condition; No Material Adverse Effect	66
	Section 3.5	Properties; Titles, Etc	67
	Section 3.6	Litigation and Environmental Matters	68
	Section 3.7	Compliance with Laws and Agreements	68
	Section 3.8	Investment Company Status; Other Laws	69
	Section 3.9	Taxes	69
	Section 3.10	ERISA Compliance	69
	Section 3.11	Insurance	69
	Section 3.12	Margin Regulations	69
	Section 3.13	Subsidiaries; Equity Interests	70
	Section 3.14	Anti-Money Laundering and Anti-Terrorism Finance Laws	70
	Section 3.15	Disclosure	70
	Section 3.16	Security Documents	70
	Section 3.17	Solvency, etc	71
	Section 3.18	[Intentionally Omitted]	71
	Section 3.19	Labor Matters	71
	Section 3.20	Material Agreements	71
	Section 3.21	Foreign Corrupt Practices Act	71
	Section 3.22	Sanctions Laws	71
	Section 3.23	Maintenance of Properties	72
	Section 3.24	Gas Imbalances, Prepayments	72
	Section 3.25	Marketing of Production	73
	Section 3.26	Hedging Agreements	73

 

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Table
of Contents

(continued)

 

	 	 	Page
	 	 	 
	Section 3.27	Location of Business and Offices	73
	Section 3.28	Deposit and Disbursement Accounts	73
	 	 	 
	ARTICLE IV	Conditions	73
	Section 4.1	Effective Date	73
	Section 4.2	Each Credit Event	77
	 	 	 
	ARTICLE V	Affirmative Covenants	78
	Section 5.1	Financial Statements and Other Information	78
	Section 5.2	Notices of Material Events	81
	Section 5.3	Existence; Conduct of Business	82
	Section 5.4	Payment of Obligations	82
	Section 5.5	Insurance	82
	Section 5.6	Books and Records; Inspection Rights	83
	Section 5.7	Compliance with Laws	83
	Section 5.8	Use of Proceeds and Letters of Credit	83
	Section 5.9	Further Assurances	83
	Section 5.10	Reserved	84
	Section 5.11	Environmental Matters	84
	Section 5.12	Operation and Maintenance of Properties	85
	Section 5.13	Reserve Reports	86
	Section 5.14	Title Information	87
	Section 5.15	Unrestricted Subsidiaries	88
	Section 5.16	Keepwell	89
	Section 5.17	Cash Management	89
	Section 5.18	Post-Closing Conditions	90
	 	 	 
	ARTICLE VI	Negative Covenants	90
	Section 6.1	Financial Covenants	90
	Section 6.2	Indebtedness	91
	Section 6.3	Liens	92
	Section 6.4	Fundamental Changes	93
	Section 6.5	Sale of Properties	93

 

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Table
of Contents

(continued)

 

	 	 	Page
	 	 	 
	Section 6.6	Investments, Loans, Advances, Guarantees and Acquisitions	95
	Section 6.7	Marketing Activities	96
	Section 6.8	Restricted Payments	96
	Section 6.9	Transactions with Affiliates	96
	Section 6.10	Changes in Nature of Business	97
	Section 6.11	Restrictive Agreements	97
	Section 6.12	Restriction of Amendments to Organization Documents	97
	Section 6.13	Changes in Fiscal Periods	98
	Section 6.14	Redemption of Permitted Secured Debt and Amendment of Permitted Secured Notes Documents and Permitted Refinancing Documents	98
	Section 6.15	Anti-Money Laundering and Anti-Terrorism Finance Laws; Foreign Corrupt Practices Act; Sanctions Laws; Restricted Person	98
	Section 6.16	Limitation on Leases	99
	Section 6.17	Gas Imbalances, Take-or-Pay or Other Prepayments	99
	Section 6.18	Hedging Agreements	99
	Section 6.19	Hedging Agreement Termination	100
	Section 6.20	Sale and Leaseback Transactions and other Off-Balance Sheet Liabilities	101
	Section 6.21	Sale or Discount of Receivables	101
	Section 6.22	Additional Collateral for Permitted Secured Notes Facility	101
	Section 6.23	Canadian Subsidiaries	101
	 	 	 
	ARTICLE VII	Events of Default	101
	Section 7.1	Events of Default	101
	Section 7.2	Application of Proceeds	104
	 	 	 
	ARTICLE VIII	The Administrative Agent	106
	Section 8.1	Appointment and Authority	106
	Section 8.2	Rights as a Lender	106
	Section 8.3	Exculpatory Provisions	106
	Section 8.4	Reliance by Administrative Agent	107
	Section 8.5	Delegation of Duties	108

 

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Table
of Contents

(continued)

 

	 	 	Page
	 	 	 
	Section 8.6	Resignation of Administrative Agent	108
	Section 8.7	Non-Reliance on Administrative Agent and Other Lenders	109
	Section 8.8	No Other Duties, etc	109
	Section 8.9	Enforcement	110
	Section 8.10	Administrative Agent May File Proofs of Claim	110
	Section 8.11	Collateral and Guaranty Matters	111
	Section 8.12	Lender Provided Hedging Agreements and Lender Provided Financial Service Products	111
	Section 8.13	INTERCREDITOR AGREEMENT	112
	Section 8.14	Indemnification	113
	 	 	 
	ARTICLE IX	Miscellaneous	113
	Section 9.1	Notices; Effectiveness; Electronic Communication	113
	Section 9.2	Waivers; Amendments	115
	Section 9.3	Expenses; Indemnity; Damage Waiver	116
	Section 9.4	Successors and Assigns	118
	Section 9.5	Survival	122
	Section 9.6	Counterparts; Integration; Effectiveness; Electronic Execution	122
	Section 9.7	Severability	123
	Section 9.8	Right of Setoff	123
	Section 9.9	Governing Law; Jurisdiction; Etc	123
	Section 9.10	Waiver of Jury Trial	124
	Section 9.11	Headings	125
	Section 9.12	Treatment of Certain Information; Confidentiality	125
	Section 9.13	Interest Rate Limitation	125
	Section 9.14	PATRIOT Act	126
	Section 9.15	Flood Insurance Provisions	126

 

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Table
of Contents

(continued)

Page

 

SCHEDULES:

 

	Schedule 2.1	Maximum Credit Amounts
	Schedule 3.4	Financial Condition; No Material Adverse Effect
	Schedule 3.5	Properties
	Schedule 3.6	Disclosed Matters
	Schedule 3.11	Insurance
	Schedule 3.13	Subsidiaries; Equity Interests
	Schedule 3.19	Labor Matters
	Schedule 3.20	Material Agreements
	Schedule 3.24	Gas Imbalances
	Schedule 3.25	Marketing Contracts
	Schedule 3.26	Hedging Agreements
	Schedule 3.27	Location of Business and Offices
	Schedule 3.28	Deposit and Disbursement Accounts
	Schedule 4.1	Debt to be Repaid
	Schedule 6.2	Existing Indebtedness
	Schedule 6.3	Existing Liens
	Schedule 6.6	Existing Investments
	Schedule 6.9	Transactions with Affiliates
	Schedule 6.10	Changes in Nature of Business
	Schedule 6.11	Restrictive Agreements

 

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Table
of Contents

 

EXHIBITS:

 

	Exhibit A	Form of Revolving Note
	Exhibit B	Form of Borrowing Request
	Exhibit C	Form of Compliance Certificate
	Exhibit D	Form of Assignment and Assumption
	Exhibit E	Form of Guarantee and Collateral Agreement
	Exhibit F	Form of Mortgage
	Exhibit G-1	Form of U.S. Tax Compliance Certificate (For Foreign Lenders That Are Not Partnerships For U.S. Federal Income Tax Purposes)
	Exhibit G-2	Form of U.S. Tax Compliance Certificate (For Foreign Participants That Are Not Partnerships For U.S. Federal Income Tax Purposes)
	Exhibit G-3	Form of U.S. Tax Compliance Certificate (For Foreign Participants That Are Partnerships For U.S. Federal Income Tax Purposes)
	Exhibit G-4	Form of U.S. Tax Compliance Certificate (For Foreign Lenders That Are  Partnerships For U.S. Federal Income Tax Purposes)
	Exhibit H-1	Form of Opinion of Borrower’s Counsel
	Exhibit H-2	Form of Opinion of Borrower’s Local North Dakota and Montana Counsel

 

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CREDIT AGREEMENT dated as of August 27,
2014, among AMERICAN EAGLE ENERGY CORPORATION, a Nevada corporation (the “Borrower”), the Lenders that
are from time to time parties hereto and SUNTRUST BANK (“SunTrust”), as Administrative Agent (in such capacity,
the “Administrative Agent”).

 

The parties hereto agree as follows:

 

ARTICLE
I

Definitions

 

Section 1.1Defined Terms. As
used in this Agreement, the following terms have the meanings specified below:

 

“Administrative Agent”
is defined in the preamble and includes any successor administrative agent appointed under Article VIII.

 

“Administrative Questionnaire”
means an Administrative Questionnaire in a form supplied by the Administrative Agent.

 

“Adjusted LIBO Rate”
means, with respect to each particular Borrowing comprised of LIBO Rate Loans and the associated LIBO Rate and Reserve Percentage,
the rate per annum calculated by the Administrative Agent (rounded upwards, if necessary, to the next higher 1/100%) determined
on a daily basis pursuant to the following formula:

 

	Adjusted LIBO Rate  =	LIBO Rate	 
	 	(1.00 – Reserve Percentage)	 

 

“Advance Payment Contract”
means any contract whereby any Loan Party either (a) receives or becomes entitled to receive (either directly or indirectly) any
payment (an “Advance Payment”) to be applied toward payment of the purchase price of Hydrocarbons produced or
to be produced from Oil and Gas Properties owned by any Loan Party and which Advance Payment is, or is to be, paid in advance of
actual delivery of such production to or for the account of the purchaser regardless of such production, or (b) grants an option
or right of refusal to the purchaser to take delivery of such production in lieu of payment, and, in either of the foregoing instances,
the Advance Payment is, or is to be, applied as payment in full for such production when sold and delivered or is, or is to be,
applied as payment for a portion only of the purchase price thereof or of a percentage or share of such production; provided
that inclusion of the standard “take or pay” provisions in any gas sales or purchase contract or any other similar
contract shall not, in and of itself, constitute such contract as an Advance Payment Contract for the purposes hereof.

 

“Affiliate” means, with
respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled
by or is under common Control with the Person specified.

 

“Aggregate Maximum Credit Amounts”
at any time shall equal the sum of the Maximum Credit Amounts, as the same may be increased, reduced or terminated pursuant to
Section 2.8.

 

    	 

    	 

    

 

“Agreement” means this
Credit Agreement.

 

“Alternate Base Rate”
means, for any day, a rate per annum equal to the greatest of (a) the rate of interest most recently announced by the Administrative
Agent as its prime lending rate as in effect from time to time (the “base rate”), (b) the Federal Funds Effective
Rate plus .5%, (c) the rate per annum determined by the Administrative Agent to be the offered rate that appears on Reuters Screen
LIBOR01 Page (or on any successor or substitute page of such page) for deposits in Dollars for a one month Interest Period in effect
on such day determined as of approximately 11:00 a.m. (London, England time) on such day (or if such day is not a Business
Day, the immediately preceding Business Day) plus 1.0%. The Alternate Base Rate is not necessarily intended to be the lowest
rate of interest determined by the Administrative Agent or any Lender in connection with extensions of credit. If for any reason
the Administrative Agent shall have determined (which determination shall be conclusive absent manifest error) that it is unable
to ascertain the Federal Funds Effective Rate specified in clause (b) of the first sentence of this definition for
any reason, including the inability or failure of the Administrative Agent to obtain sufficient quotations in accordance with the
terms hereof, the Alternate Base Rate shall be determined without regard to clause (b) of the first sentence of this
definition until the circumstances giving rise to such inability no longer exist. Any change in the Alternate Base Rate shall be
effective on the effective date of any change in such rate.

 

“Anti-Terrorism Laws”
is defined in Section 3.14.

 

“Applicable Law” means,
with respect to any Person, (a) all provisions of law, statute, treaty, ordinance, rule, regulation, requirement, restriction,
permit, certificate, decision, directive or order of any Governmental Authority applicable to such Person or any of its property
and (b) all judgments, injunctions, orders and decrees of all courts and arbitrators in proceedings or actions in which such Person
is a party or by which any of its property is bound.

 

“Applicable Percentage”
means, with respect to any Lender, the percentage of the Aggregate Maximum Credit Amounts represented by such Lender’s Maximum
Credit Amount as such percentage is set forth on Schedule 2.1 or as may be adjusted from time to time in accordance with
the terms hereof.

 

“Applicable Margin” means,
for any day, with respect to any Base Rate Loan or Eurodollar Loan or the Commitment Fee Rate, the rate per annum set forth in
the Borrowing Base Utilization Grid below based upon the Borrowing Base Utilization Percentage then in effect:

 

	Borrowing Base Utilization
 Percentage	 	<25%	 	 	>25%
    but
 <50 %	 	 	>50%
    but 
<75 %	 	 	>75%
    but 
 <90 %	 	 	>90%	 
	Base Rate Loans	 	 	2.75	%	 	 	3.00	%	 	 	3.25	%	 	 	3.50	%	 	 	3.75	%
	Eurodollar Loans	 	 	1.75	%	 	 	2.00	%	 	 	2.25	%	 	 	2.50	%	 	 	2.75	%
	Commitment Fee Rate	 	 	0.375	%	 	 	0.375	%	 	 	0.50	%	 	 	0.50	%	 	 	0.50	%

 

    	2

    	 

    

 

Each change in the Applicable Margin or
Commitment Fee Rate shall apply during the period commencing on the effective date of such change and ending on the date immediately
preceding the effective date of the next such change; provided, however, that if at any time the Borrower fails to
deliver a Reserve Report pursuant to Section 5.13, then the “Applicable Margin” and the “Commitment
Fee Rate” means the rate per annum set forth on the applicable grid when the applicable Borrowing Base Utilization Percentage
is at its highest level; provided further that the Applicable Margin and Commitment Fee Rate shall revert to the
previous Applicable Margin and Commitment Fee Rate upon the Borrower’s delivery of such Reserve Report.

 

“Approved Counterparty”
means any Person who, at the time of entry into the applicable Hedging Agreement, is a Lender or an Affiliate of a Lender.

 

“Approved Fund” means
any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity
that administers or manages a Lender.

 

“Approved Petroleum Engineers”
means (a) Ryder Scott Company, L.P. and (b) any other independent petroleum engineers reasonably acceptable to the Administrative
Agent.

 

“Assignment and Assumption”
means an assignment and assumption entered into by a Lender and an Eligible Assignee (with the consent of any party whose consent
is required by Section 9.4), and accepted by the Administrative Agent, in substantially the form of Exhibit B
or any other form approved by the Administrative Agent.

 

“Availability Period”
means the period from and including the Effective Date to but excluding the earlier of the Maturity Date and the date of termination
of the Commitments.

 

“Base Rate,” when used
in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing interest
at a rate determined by reference to the Alternate Base Rate.

 

“Beneficial Owner” has
the meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the beneficial
ownership of any particular “person” (as that term is used in Section 13(d)(3) of the Exchange Act), such “person”
will be deemed to have beneficial ownership of all securities that such “person” has the right to acquire by conversion
or exercise of other securities, whether such right is currently exercisable or is exercisable only after the passage of time.
The terms “Beneficially Owns” and “Beneficially Owned” have a corresponding meaning. For purposes of this
definition, a Person shall be deemed not to Beneficially Own securities that are the subject of a stock purchase agreement, merger
agreement, amalgamation agreement, arrangement agreement or similar agreement until consummation of the transactions or, as applicable,
series of related transactions contemplated thereby.

 

“Borrower” is defined
in the preamble.

 

“Borrower Materials”
is defined in Section 9.1(d).

 

“Borrowing” means Loans
of the same Type made, converted or continued on the same date and, in the case of Eurodollar Loans, as to which a single Interest
Period is in effect.

 

    	3

    	 

    

 

“Borrowing Base” means
at any time an amount equal to the amount determined in accordance with Section 2.4, as the same may be adjusted from
time to time pursuant to Section 2.4.

 

“Borrowing Base Deficiency Determination
Date” means the date on which the Administrative Agent shall have notified the Borrower that (a) the aggregate Credit
Exposure exceeds (b) the Borrowing Base then in effect.

 

“Borrowing Base Deficiency Payment
Date” means, with respect to each Borrowing Base Deficiency Determination Date, the corresponding day of the month in
each of the six consecutive months occurring immediately after such Borrowing Base Deficiency Determination Date or if any of such
months does not have a corresponding day, then, with respect to such month(s), the last day of such month, provided that
if any such corresponding day is not a Business Day, then the Borrowing Base Deficiency Payment Date for such month shall be the
Business Day immediately succeeding such corresponding day.

 

“Borrowing Base Utilization Percentage”
means as of any day, the fraction expressed as a percentage, the numerator of which is the sum of the Credit Exposures of the Lenders
on such day, and the denominator of which is the lesser of (a) the Aggregate Maximum Credit Amount in effect on such day or (b)
the Borrowing Base in effect on such day.

 

“Borrowing Request” means
a request by the Borrower for a Borrowing in accordance with Section 2.3.

 

“Business Day” means
any day that is not a Saturday, Sunday or other day on which commercial banks in Atlanta, Georgia, New York City or Houston, Texas,
are authorized or required by law to remain closed; provided that, when used in connection with a Eurodollar Loan, the term
“Business Day” shall also exclude any day on which banks are not open for dealings in Dollar deposits in the
London interbank market.

 

“Capital Lease Obligations”
of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying
the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted
for as capital leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized
amount thereof determined in accordance with GAAP.

 

“Cash Collateralize”
means to pledge and deposit with or deliver to the Administrative Agent, for the benefit of one or more of the Issuing Banks or
Lenders, as collateral for LC Exposure, or obligations of Lenders to fund participations in respect of LC Exposure, cash or deposit
account balances or, if the Administrative Agent and each applicable Issuing Bank shall agree in their sole discretion, other credit
support, in each case pursuant to documentation in form and substance satisfactory to the Administrative Agent and each applicable
Issuing Bank.

 

“Cash Collateral” shall
have a meaning correlative to the foregoing and shall include the proceeds of such Cash Collateral and other credit support.

 

“Cash Equivalent Investments”
means:

 

    	4

    	 

    

 

(a)          direct
obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America
(or by any agency thereof to the extent such obligations are backed by the full faith and credit of the United States of America),
in each case maturing within one year from the date of acquisition thereof;

 

(b)          investments
in commercial paper maturing within 270 days from the date of acquisition thereof and having, at such date of acquisition, the
highest credit rating obtainable from S&P or from Moody’s;

 

(c)          investments
in certificates of deposit, banker’s acceptances and time deposits maturing within 180 days from the date of acquisition
thereof issued or guaranteed by or placed with, and money market deposit accounts issued or offered by, any domestic office of
any commercial bank organized under the laws of the United States of America or any State thereof that has a combined capital and
surplus and undivided profits of not less than $500,000,000;

 

(d)          fully
collateralized repurchase agreements with a term of not more than 30 days for securities described in clause (b) above
and entered into with a financial institution satisfying the criteria described in clause (c) above; and

 

(e)          money
market funds that (i) comply with the criteria set forth in SEC Rule 2a-7 under the Investment Company Act of 1940, (ii) are
rated AAA by S&P and Aaa by Moody’s and (iii) have portfolio assets of at least $5,000,000,000.

 

“Casualty Event” means
any loss, casualty or other damage to, or any nationalization, taking under power of eminent domain or by condemnation or similar
proceeding of, any Property of the Borrower or any of its Restricted Subsidiaries having a fair market value in excess of $1,000,000.

 

“Change of Control” means
the occurrence of any of the following:

 

(a)          the
direct or indirect sale, lease, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one
or a series of related transactions, of all or substantially all of the properties or assets of the Borrower and its Subsidiaries
taken as a whole to any Person (including, without limitation, any “person” (as that term is used in Section 13(d)(3)
of the Exchange Act));

 

(b)          the
adoption of a plan relating to the liquidation or dissolution of the Borrower;

 

(c)          the
consummation of any transaction (including, without limitation, any merger or consolidation) the result of which is that any “person”
(as defined above) becomes the Beneficial Owner, directly or indirectly, of more than 50% of the Voting Stock of the Borrower,
measured by voting power rather than number of shares, units or the like; or

 

(d)          the
first day on which a majority of the members of the Board of Directors of the Borrower are not Continuing Directors.

 

    	5

    	 

    

 

“Change in Law” means
the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any law, rule,
regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation, implementation
or application thereof by any Governmental Authority or (c) the making or issuance of any request, rule, guideline or directive
(whether or not having the force of law) by any Governmental Authority; provided that notwithstanding anything herein to
the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives
thereunder or issued in connection therewith and (ii) all requests, rules, guidelines or directives promulgated by the Bank for
International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States
or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”,
regardless of the date enacted, adopted or issued.

 

“Collateral” means any
property of any Loan Party upon which a security interest in favor of the Administrative Agent for the benefit of the holders of
Secured Obligations is purported to be granted pursuant to any Security Document.

 

“Commitment” means, with
respect to each Lender, the commitment, if any, of such Lender to make Loans and to acquire participations in Letters of Credit
hereunder, expressed as an amount representing the maximum aggregate amount of such Lender’s Credit Exposure hereunder, as
such commitment may be reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 9.4.
The amount representing each Lender’s Commitment shall at any time be the lesser of such Lender’s Maximum Credit Amount
and such Lender’s Applicable Percentage of the then effective Borrowing Base.

 

“Commitment Fee Rate”
has the meaning assigned to such term in the definition of Applicable Margin.

 

“Commodity Exchange Act”
means the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any successor statute.

 

“Compliance Certificate”
means a certificate substantially in the form of Exhibit C.

 

    	6

    	 

    

 

“Consolidated Net Income”
means with respect to the Borrower and its Restricted Subsidiaries, for any period, the aggregate of the net income (or loss) of
the Borrower and its Restricted Subsidiaries after allowances for taxes for such period determined on a consolidated basis in accordance
with GAAP; provided that there shall be excluded from such net income (to the extent otherwise included therein) the following:
(a) the net income of any Person (other than the Borrower) if such Person is not a Restricted Subsidiary, except (i) the Borrower’s
equity in the net income of any such Person shall be included in Consolidated Net Income to the extent of the amount of dividends
or distributions actually paid in cash during such period by such other Person to the Borrower or to a Restricted Subsidiary, as
the case may be (and in the case of a dividend or other distribution to a Restricted Subsidiary, such Restricted Subsidiary is
not precluded from further distributing such amount to the Borrower as described in clause (b)) and (ii) the Borrower’s
equity in a net loss of any such Person for such period shall be included in determining such Consolidated Net Income; (b) the
net income (but not loss) during such period of any Restricted Subsidiary to the extent that the declaration or payment of dividends
or similar distributions or transfers or loans by that Restricted Subsidiary is not at the time permitted by operation of the terms
of its Organization Documents or any agreement, instrument or Applicable Law applicable to such Restricted Subsidiary or is otherwise
restricted or prohibited, in each case determined in accordance with GAAP; (c) the net income (or loss) of any Person acquired
in a pooling-of-interests transaction for any period prior to the date of such transaction; (d) the net income (or deficit) of
any Person accrued prior to the date it becomes a Restricted Subsidiary or is merged into or consolidated with the Borrower or
any of its Restricted Subsidiaries; (e) any extraordinary gains or losses during such period; (f) the cumulative effect of a change
in accounting principles and any gains or losses attributable to writeups or writedowns of assets (including as a result of ASC
Topic 410, formerly FAS 143), (g) non-cash gains or losses or charges in respect of interest rate agreements, currency agreements
or commodity agreements (including those resulting from the application of ASC Topic 815, formerly FAS 133, but shall expressly
include any cash charges or payments in respect of the termination of any Hedging Agreement) and (h) any writedowns of non-current
assets, provided, however, that any ceiling limitation writedowns under SEC guidelines shall be treated as capitalized
costs, as if such writedowns had not occurred; and provided further that if the Borrower or any Restricted Subsidiary
shall acquire or Dispose of any Property or designate any Subsidiary as a Restricted Subsidiary or an Unrestricted Subsidiary during
such period, then Consolidated Net Income shall be calculated after giving pro forma effect in accordance with Regulations S –
X under the Securities Act of 1933 to such acquisition or Disposition or designation, as if such acquisition or Disposition or
designation had occurred on the first day of such period.

 

“Continuing Directors”
means, as of any date of determination, any member of the Board of Directors of the Borrower who:

 

(a)          was
a member of such Board of Directors on Effective Date; or

 

(b)          was
nominated for election or elected to such Board of Directors with the approval of a majority of the Continuing Directors who were
members of such Board of Directors at the time of such nomination or election.

 

“Control” means the possession,
directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through
the ability to exercise voting power, by contract or otherwise. “Controlling” and “Controlled”
have meanings correlative thereto.

 

“Controlled Account”
is defined in Section 5.17(a).

 

“Credit Exposure” means,
as to any Lender at any time, the aggregate principal amount at such time of its outstanding Loans and such Lender’s LC Exposure
at such time.

 

“Debt to be Repaid” means
Indebtedness listed on Schedule 4.1.

 

“Debtor Relief Laws”
means the Bankruptcy Code of the United States of America, and all other liquidation, conservatorship, bankruptcy, assignment for
the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization or similar debtor relief laws of
the United States or other applicable jurisdictions.

 

    	7

    	 

    

 

“Default” means any event
or condition that constitutes an Event of Default or that with notice, lapse of time or both would become an Event of Default.

 

“Defaulting Lender” means,
subject to Section 2.22(b), any Lender that (a) has failed to (i) fund all or any portion of its Loans within two Business
Days of the date such Loans were required to be funded hereunder unless such Lender notifies the Administrative Agent and the Borrower
in writing that such failure is the result of such Lender’s determination that one or more conditions precedent to funding
(each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has
not been satisfied, or (ii) pay to the Administrative Agent, any Issuing Bank or any other Lender any other amount required to
be paid by it hereunder (including in respect of its participation in Letters of Credit) within two Business Days of the date when
due, (b) has notified the Borrower, the Administrative Agent or any Issuing Bank, in writing that it does not intend to comply
with its funding obligations hereunder, or has made a public statement to that effect (unless such writing or public statement
relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s
determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be
specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three Business Days after
written request by the Administrative Agent or the Borrower, to confirm in writing to the Administrative Agent and the Borrower
that it will comply with its prospective funding obligations hereunder (provided that such Lender shall cease to be a Defaulting
Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Borrower)
or (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor Relief
Law or (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors
or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance
Corporation or any other state or federal regulatory authority acting in such a capacity; provided that a Lender shall not
be a Defaulting Lender solely by virtue of the ownership or acquisition of any Equity Interest in that Lender or any direct or
indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such
Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of
attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any
contracts or agreements made with such Lender. Any determination by the Administrative Agent that a Lender is a Defaulting Lender
under any one or more of clauses (a) through (d) above shall be conclusive and binding absent manifest error,
and such Lender shall be deemed to be a Defaulting Lender (subject to Section 2.22(b)) upon delivery of written notice
of such determination to the Borrower, each Issuing Bank, and each Lender.

 

“Disclosed Matters” means
the actions, suits and proceedings and the environmental matters disclosed in Schedule 3.6.

 

“Disposition,” with respect
to any property, means any sale, lease, sale and leaseback, assignment, conveyance, transfer or other disposition thereof. The
terms “Dispose” and “Disposed of” have meanings correlative thereto.

 

    	8

    	 

    

 

“Disqualified Equity Interests”
means any Equity Interest that, by its terms (or by the terms of any security or other Equity Interest into which it is convertible
or for which it is exchangeable), or upon the happening of any event or condition (a) matures or is mandatorily redeemable (other
than solely for Equity Interests that are not otherwise Disqualified Equity Interests), pursuant to a sinking fund obligation or
otherwise, (b) is redeemable at the option of the holder thereof (other than solely for Equity Interests that are not otherwise
Disqualified Equity Interests), in whole or in part, (c) provides for scheduled payments or dividends in cash or (d) is or becomes
convertible into or exchangeable for Indebtedness or any other Equity Interests that would constitute Disqualified Equity Interests,
in each case, prior to the date that is 180 days after the Maturity Date. The amount of Disqualified Equity Interests deemed to
be outstanding at any time for purposes of this Agreement will be the maximum amount that the Borrower and its Restricted Subsidiaries
may become obligated to pay upon the maturity of, or pursuant to any mandatory redemption provisions of, such Disqualified Equity
Interests, exclusive of accrued dividends.

 

“Dollars” or “$”
refers to lawful money of the United States of America.

 

“Domestic Subsidiary”
means any Restricted Subsidiary of the Borrower organized under the laws of any jurisdiction within the United States.

 

“EBITDAX” means, for
any period, the sum of Consolidated Net Income for such period plus, without duplication, the following expenses or charges of
the Borrower and the Restricted Subsidiaries to the extent deducted from Consolidated Net Income in such period: (a) Taxes paid
or accrued; (b) interest expense; (c) amortization, depletion and depreciation expense; (d) any non-cash losses or charges resulting
from the application of ASC Topic 815, formerly FAS 133, ASC Topic 410, formerly FAS 143 or ASC Topic 360, formerly FAS 144; (e)
oil and gas exploration and abandonment expenses, whether expensed or capitalized (to the extent deducted from Consolidated Net
Income), (including all drilling, completion, geological and geophysical costs); (f) extraordinary or non-recurring losses; (g)
other non-cash charges (excluding accruals for cash expenses made in the ordinary course of business); minus, to the extent
included in the Consolidated Net Income for such period any non-cash income included in Consolidated Net Income (excluding accruals
for cash income made in the ordinary course of business); and provided further that if the Borrower or any Restricted
Subsidiary shall acquire or Dispose of any Property, in each case with consideration exceeding $2,000,000, or designate any Subsidiary
as a Restricted Subsidiary or an Unrestricted Subsidiary during such period, then EBITDAX shall be calculated after giving pro
forma effect to such acquisition or Disposition or designation, as if such acquisition or Disposition or designation had occurred
on the first day of such period, in accordance with Regulations S - X under the Securities Act of 1933 or in such other manner
as shall be reasonably acceptable to the Administrative Agent.

 

Notwithstanding the foregoing, the items
specified in clauses (a), (c) - (g) for any Restricted Subsidiary shall be added to Consolidated Net
Income in calculating EBITDAX only:

 

(a)          in
proportion to the percentage of the total Equity Interests of such Restricted Subsidiary held directly or indirectly by the Borrower,
and

 

    	9

    	 

    

 

(b)          to
the extent that a corresponding amount would be permitted at the date of determination to be distributed to the Borrower by such
Restricted Subsidiary pursuant to its Organization Documents and each Applicable Law, agreement or judgment applicable to such
distribution.

 

“Effective Date” means
the date on which the conditions specified in Section 4.1 are satisfied (or waived in accordance with Section 9.2).

 

“Eligible Assignee” means
any Person that meets the requirements to be an assignee under Section 9.4(b)(iii), (v) and (vi) (subject
to such consents, if any, as may be required under Section 9.4(b)(iii)).

 

“Engineering Reports”
has the meaning assigned such term in Section 2.4(c)(i).

 

“Environmental Laws”
means all Applicable Law relating in any way to the environment, preservation or reclamation of natural resources, the management,
release or threatened release of any Hazardous Material or to health and safety matters.

 

“Environmental Liability”
means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties
or indemnities), of the Borrower or any Subsidiary directly or indirectly resulting from or based upon (a) violation of any
Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials,
(c) exposure to any Hazardous Materials, (d) the release or threatened release of any Hazardous Materials into the environment
or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to
any of the foregoing.

 

“Equity Interests” means
shares of capital stock, partnership interests, membership interests in a limited liability company, beneficial interests in a
trust or other equity ownership interests in a Person, and any warrants, options or other rights entitling the holder thereof to
purchase or acquire any such equity interest.

 

“Equity Issuance” shall
mean, without duplication, (a) any issuance or sale by the Borrower after the Effective Date of any Equity Interests in the Borrower
(including any Equity Interests issued upon exercise of any warrant or option) or any warrants or options to purchase Equity Interests
or (b) any contribution to the capital of the Borrower.

 

“ERISA” means the Employee
Retirement Income Security Act of 1974.

 

“ERISA Affiliate” means
any trade or business (whether or not incorporated) that, together with the Borrower, is treated as a single employer under Section 414(b)
or (c) of the IRC or, solely for purposes of Section 302 of ERISA and Section 412 of the IRC, is treated as a single
employer under Section 414 of the IRC.

 

    	10

    	 

    

 

“ERISA Event” means (a) any
“reportable event,” as defined in Section 4043 of ERISA or the regulations issued thereunder with respect to a
Plan (other than an event for which the 30-day notice period is waived); (b) the determination that any Pension Plan or Multiemployer
Plan, as applicable, is considered an at-risk plan or that any Pension Plan or Multiemployer Plan, as applicable, is endangered
or is in critical status within the meaning of Sections 430, 431 or 432 of the IRC or Sections 303, 304 or 305 of ERISA;
(c) the incurrence by the Borrower or any ERISA Affiliate of any liability under Title IV of ERISA with respect to the
termination of any Plan, other than for PBGC premiums due but not yet delinquent; (d) the receipt by the Borrower or any ERISA
Affiliate from the PBGC or a plan administrator of any notice relating to an intention to terminate any Pension Plan or to appoint
a trustee to administer any Pension Plan or the occurrence of any event or condition which constitutes grounds under Section 4042
of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan; (e) the appointment of a trustee
to administer any Pension Plan; (f) the withdrawal of the Borrower or any ERISA Affiliate from a Pension Plan subject to Section 4063
of ERISA during a plan year in which such entity was a substantial employer (as defined in Section 4001(a)(2) of ERISA) or
the cessation of operations by the Borrower or any ERISA Affiliate that would be treated as a withdrawal from a Pension Plan under
Section 4062(d) of ERISA; (g) the partial or complete withdrawal by the Borrower or any ERISA Affiliate from any Multiemployer
Plan or a notification that a Multiemployer Plan is in reorganization; or (h) the taking of any action to terminate any Pension
Plan under Section 4041 or 4041A of ERISA.

 

“Eurodollar,” when used
in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing interest
at a rate determined by reference to the Adjusted LIBO Rate.

 

“Event of Default” is
defined in Article VII.

 

“Exchange Act” means
the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC promulgated thereunder.

 

“Excluded Hedge Obligation”
means, with respect to any Loan Party, any Lender Provided Hedge Agreement if and to the extent that all or a portion of the guarantee
of such Loan Party of, or the grant by such Loan Party of a security interest to secure, such Lender Provided Hedge Agreement (or
any guarantee thereof) is or becomes (as a result of a Change in Law after the date of a transaction governed by such Lender Provided
Hedge Agreement) illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission
(or the application or official interpretation of any thereof) by virtue of such Loan Party’s failure for any reason to constitute
a Qualified ECP Guarantor at the time such Loan Party’s guarantee or such Loan Party’s grant of such security interest
becomes effective with respect to such Lender Provided Hedge Agreement. If a Hedging Obligation arises under a Lender Provided
Hedge Agreement governing more than one Hedging Agreement, such exclusion shall apply only to the portion of such Hedging Obligation
that is attributable to Hedging Agreements for which such guarantee or security interest is or becomes illegal.

 

“Excluded Taxes” means
any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a
Recipient: (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes imposed on it, and branch profits
Taxes, in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having its principal office
or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision
thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal withholding Taxes imposed on amounts
payable to or for the account of such Lender with respect to an applicable interest in a Loan or Commitment pursuant to a law in
effect on the date on which (i) such Lender acquires such interest in such Loan or Commitment (other than pursuant to an assignment
request by the Borrower under Section 2.20) or (ii) such Lender changes its lending office, except in each case to
the extent that, pursuant to Section 2.17, amounts with respect to such Taxes were payable either to such Lender’s
assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its lending office,
(c) Taxes attributable to such Recipient’s failure to comply with Section 2.17(g) and (d) any U.S. federal withholding
Taxes imposed under FATCA.

 

    	11

    	 

    

 

“Executive Order” is
defined in Section 3.23.

 

“Facility” means the
Commitments and the extensions of credit made thereunder.

 

“FATCA” means Sections 1471
through 1474 of the IRC, as of the date of this Agreement (or any amended or successor version that is substantively comparable
and not materially more onerous to comply with) any current or future U.S. Treasury regulations promulgated thereunder or official
IRS interpretations thereof, any agreement entered into pursuant to Section 1471(b)(1) of the IRC and any fiscal or regulatory
legislation, rules or practices adopted pursuant to any intergovernmental agreement entered into in connection with the implementation
of such Sections of the IRC.

 

“Federal Funds Effective Rate”
means, for any day, the weighted average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight Federal
funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as published on the next succeeding
Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business
Day, the average (rounded upwards, if necessary, to the next 1/100 of 1%) of the quotations for such day for such transactions
received by the Administrative Agent from three Federal funds brokers of recognized standing selected by it.

 

“Fee Letter” means that
fee letter dated August 1, 2014, between Borrower and the Arranger, with respect to fees payable by the Borrower in connection
with this Agreement, as the same may be amended, supplemented, restated or otherwise modified from time to time.

 

“Final Borrowing Base Deficiency
Payment Date” means, with respect to each Borrowing Base Deficiency Date, the corresponding day of the month in the sixth
(6th) month after the Borrowing Base Deficiency Determination Date, or if such month has no such corresponding day,
then the last day of such month, provided that if any such corresponding day is not a Business Day, then the Borrowing Base
Deficiency Payment Date for such month shall be the Business Day immediately succeeding such corresponding day.

 

“Financial Officer” means
the chief financial officer, principal accounting officer, treasurer or controller of the Borrower.

 

“Foreign Lender” means
a Lender that is not a U.S. Person.

 

    	12

    	 

    

 

“Foreign Subsidiary”
means any Restricted Subsidiary of the Borrower that is not a Domestic Subsidiary.

 

“FRB” means the Board
of Governors of the Federal Reserve System of the United States of America.

 

“Fronting Exposure” means,
at any time there is a Defaulting Lender, with respect to any Issuing Bank, such Defaulting Lender’s Applicable Percentage
of the outstanding LC Exposure with respect to Letters of Credit issued by such Issuing Bank other than LC Exposure as to which
such Defaulting Lender’s participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance
with the terms hereof.

 

“Fund” means any Person
(other than a natural Person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its activities.

 

“Funding Rules” means
the requirements relating to the minimum required contributions (including any installment payments) to Pension Plans and Multiemployer
Plans, as applicable, and set forth in Sections 412 of the IRC and Section 302 of ERISA for periods prior to the effective
date of the Pension Protection Act of 2006 and Sections 412, 430, 431, 432 and 436 of the IRC and Sections 302, 303,
304 and 305 of ERISA for periods on and after the effective date of the Pension Protection Act of 2006.

 

“GAAP” means generally
accepted accounting principles in the United States of America.

 

“Governmental Authority”
means the government of the United States of America or any other nation, or of any political subdivision thereof, whether state,
regional or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising
executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including
any supra-national bodies such as the European Union or the European Central Bank).

 

“Guarantee” of or by
any Person (the “guarantor”) means any obligation, contingent or otherwise, of the guarantor guaranteeing, or
having the economic effect of guaranteeing, any Indebtedness or other obligation of any other Person (the “primary obligor”)
in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase
or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to
advance or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property, securities
or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (c) to
maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to
enable the primary obligor to pay such Indebtedness or other obligation or (d) as an account party in respect of any letter of
credit or letter of guaranty issued to support such Indebtedness or obligation; provided that the term “Guarantee”
shall not include endorsements for collection or deposit in the ordinary course of business.

 

“Guarantor” means each
Domestic Subsidiary.

 

    	13

    	 

    

 

“Guarantee and Collateral Agreement”
means the Guarantee and Collateral Agreement executed by the Guarantors in favor of the Administrative Agent for the benefit of
the holders of Secured Obligations, substantially in the form of Exhibit E.

 

“Hazardous Materials”
means all toxic, corrosive, flammable, explosive, carcinogenic, mutagenic, infectious or radioactive substances or wastes and all
other hazardous or toxic substances, wastes or other pollutants, including petroleum or any fraction thereof, petroleum distillates,
asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other substances
or wastes of any nature regulated pursuant to any Environmental Law.

 

“Hedge Liquidation” means
the sale, assignment, novation, liquidation, unwind, cancellation, modification or termination of all or any part of any Hedge
Agreement included in the calculation of the Borrowing Base (other than, in each case, at its scheduled maturity).

 

“Hedging Agreement” means
any agreement with respect to any swap, cap, collar, forward, future or derivative transaction or option or similar agreement involving,
or settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic,
financial or pricing indices or measures of economic, financial or pricing risk or value or any similar transaction or any combination
of these transactions; provided that no phantom stock or similar plan providing for payments only on account of services
provided by current or former directors, officers, employees or consultants of the Borrower or the Subsidiaries shall be a Hedging
Agreement.

 

“Hedging Cancellation Notice”
has the meaning assigned to such term in Section 2.4(c)(i).

 

“Hedging Obligation”
means, with respect to any Guarantor, any obligation to pay or perform under any agreement, contract or transaction that constitutes
a “swap” within the meaning of section 1a(47) of the Commodity Exchange Act.

 

“Hedging Termination Value”
means, during any period between two successive Scheduled Redetermination Dates, the net effect of any Hedge Liquidation (after
giving effect to any new hedge position or Hedging Agreement previously entered into during such period) (as reasonably determined
by the Administrative Agent and the Required Lenders) on the Borrowing Base then in effect.

 

“Hydrocarbon Interests”
means all rights, titles, interests and estates now or hereafter acquired in and to oil and gas leases, oil, gas and mineral leases,
or other liquid or gaseous hydrocarbon leases, mineral fee interests, overriding royalty and royalty interests, net profit interests
and production payment interests, including any reserved or residual interests of whatever nature. Unless otherwise indicated herein,
each reference to the term “Hydrocarbon Interests” shall mean Hydrocarbon Interests of the Borrower and/or the Restricted
Subsidiaries as the context requires.

 

“Hydrocarbons” means
oil, gas, casinghead gas, drip gasoline, natural gasoline, condensate, distillate, liquid hydrocarbons, gaseous hydrocarbons and
all products refined or separated therefrom.

 

    	14

    	 

    

 

“Increased Cost Lender”
is defined in Section 2.20(b).

 

“Increase Effective Date”
is defined in Section 2.1(b)(iv).

 

“Indebtedness” of any
Person means, without duplication, (a) all obligations of such Person for borrowed money or with respect to deposits or advances
of any kind, (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all
obligations of such Person upon which interest charges are customarily paid, (d) all obligations of such Person under conditional
sale or other title retention agreements relating to property acquired by such Person, (e) all obligations of such Person
in respect of the deferred purchase price of property or services (excluding accounts payable incurred in the ordinary course of
business that are paid within 60 days after their stated due date), (f) all Indebtedness of others secured by (or for which
the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or
acquired by such Person, whether or not the Indebtedness secured thereby has been assumed, (g) all Guarantees by such Person
of Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i) all obligations, contingent or otherwise,
of such Person as an account party in respect of letters of credit and letters of guaranty, (j) Disqualified Equity Interests,
(k) all obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances, (l) all obligations, contingent
or otherwise, of such Person under Hedging Agreements after giving effect to any legally enforceable netting obligations, (m) all
obligations or undertakings of such Person to maintain or cause to be maintained the financial position or covenants of others
or to purchase the Indebtedness of others, (n) obligations to deliver commodities, goods or services, including, without limitation,
Hydrocarbons, in consideration of one or more advance payments, other than gas balancing arrangements in the ordinary course of
business (but only to the extent of such advance payments), (o) obligations under “take or pay” or similar agreements
(other than obligations under firm transportation or drilling contracts), and (p) the undischarged balance of any production payment
created by such Person or for the creation of which such Person directly or indirectly received payment. The Indebtedness of any
Person shall include all obligations of such Person of the character described above to the extent such Person remains legally
liable in respect thereof notwithstanding that any such obligation is not included as a liability of such Person under GAAP. The
Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is
a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other
relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor.

 

“Indemnified Taxes” means
(a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of any
Loan Party under any Loan Document and (b) to the extent not otherwise described in clause (a), Other Taxes.

 

“Indemnitee” is defined
in Section 9.3.

 

“Information” is defined
in Section 9.12.

 

    	15

    	 

    

 

“Initial Reserve Report”
means the report of the Borrower, dated as of July 14, 2014, with respect to certain Oil and Gas Properties of the Borrower and
its Restricted Subsidiaries as of June 30, 2014, prepared by Ryder Scott Company, L.P.

 

“Intercreditor Agreement”
means (a) with respect to the Permitted Secured Debt, that certain Intercreditor Agreement by and among the Borrower, the Guarantors,
the Administrative Agent and the Permitted Secured Notes Agent, as amended, modified or supplemented in accordance with the terms
thereof, and (b) with respect to Permitted Refinancing Debt that is secured debt, an intercreditor agreement in form and substance
acceptable to the Administrative Agent and the Majority Lenders in their sole discretion, as amended, modified or supplemented
in accordance with the terms thereof.

 

“Interest Election Request”
means a request by the Borrower to convert or continue a Borrowing in accordance with Section 2.7.

 

“Interest Payment Date”
means (a) with respect to any Base Rate Loan, the last day of each March, June, September and December, (b) with respect to any
Eurodollar Loan, the last day of the Interest Period applicable to the Borrowing of which such Loan is a part and, in the case
of a Eurodollar Borrowing with an Interest Period of more than three months’ duration, each day prior to the last day of
such Interest Period that occurs at intervals of three months’ duration after the first day of such Interest Period.

 

“Interest Period” means,
with respect to any Eurodollar Borrowing, the period commencing on the date of such Borrowing and ending on the numerically corresponding
day in the calendar month that is one, two, three or six months (or, with the consent of each applicable Lender, nine or twelve
months) thereafter, as the Borrower may elect; provided, that (a) if any Interest Period would end on a day other than a
Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day
would fall in the next calendar month, in which case such Interest Period shall end on the preceding Business Day and (b) any Interest
Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding
day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest
Period. For purposes hereof, the date of a Borrowing initially shall be the date on which such Borrowing is made and thereafter
shall be the effective date of the most recent conversion or continuation of such Borrowing.

 

“Interim Redetermination”
shall mean any redetermination of the Borrowing Base pursuant to Section 2.4(b)(ii) or (iii).

 

“Investment” means, with
respect to any Person, all investments by such Person in other Persons (including Affiliates) in the form of any direct or indirect
advance, loan or other extension of credit (including by way of Guarantee or similar arrangement) or capital contribution to (by
means of any transfer of cash or other property or any payment for property or services for the account or use of others), or any
purchase or acquisition of Equity Interests, evidences of Indebtedness or other securities of, such other Person and all other
items that are or would be classified as investments on a balance sheet prepared in accordance with GAAP, and any purchase or other
acquisition (in one transaction or a series of transactions) of any assets of any other Person constituting a business unit; provided
that the endorsement of negotiable instruments and documents in the ordinary course of business will not be deemed to be an Investment.

 

    	16

    	 

    

 

“IRC” means the Internal
Revenue Code of 1986.

 

“IRS” means the United
States Internal Revenue Service.

 

“ISP98” means, with respect
to any Letter of Credit, the “International Standby Practices 1998” published by the International Chamber of Commerce,
Publication Number 590 (or such later version thereof as may be in effect at the time of issuance).

 

“Issuing Bank” means
SunTrust, in its capacity as issuer of Letters of Credit hereunder, or such other Lender as the Borrower may from time to time
select as an Issuing Bank hereunder pursuant to Section 2.5, with the consent of the Administrative Agent and such
other Lender.

 

“LC Application” means
an application and agreement for the issuance or amendment of a Letter of Credit in the form from time to time in use by, or otherwise
acceptable to, the applicable Issuing Bank.

 

“LC Disbursement” means
a payment made by an Issuing Bank pursuant to a Letter of Credit.

 

“LC Exposure” means,
at any time, the sum of (a) the aggregate undrawn amount of all outstanding Letters of Credit at such time plus (b) the
aggregate amount of all LC Disbursements that have not yet been reimbursed by or on behalf of the Borrower at such time. The LC
Exposure of any Lender at any time shall be its Applicable Percentage of the total LC Exposure at such time. For all purposes of
this Agreement, if on any date of determination a Letter of Credit has expired by its terms but any amount may still be drawn thereunder
by reason of the operation of Rule 3.14 of the ISP98 (or another rule or contractual provision having a similar effect), such Letter
of Credit shall be deemed to be outstanding in the amount so remaining available to be drawn.

 

“LC Sublimit” means an
amount equal to the lesser of (a) $2,500,000 and (b) the aggregate Commitments. The LC Sublimit is part of, and not in addition
to, the Facility.

 

“Lender” means each Person
listed on Schedule 2.1 and any other Person that shall have become a party hereto as a Lender pursuant to an Assignment
and Assumption, other than any such Person that ceases to be a party hereto pursuant to an Assignment and Assumption.

 

“Lender Provided Financial Service
Product” means any agreement or other arrangements under which any Lender or any Affiliate of any Lender provides any
of the following products or services to any of the Loan Parties: (a) credit cards, (b) credit card processing services, (c) debit
cards, (d) purchase cards, (e) gift cards, (f) ACH transactions, (g) cash management, including electronic funds transfer, controlled
disbursement, accounts or services, (h) overdraft or (i) foreign currency exchange.

 

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“Lender Provided Hedging Agreement”
means any Hedging Agreement between a Loan Party and a counterparty that at the time such Hedging Agreement is entered into is
a Lender or an Affiliate of a Lender; provided that, for the avoidance of doubt, the term “Lender Provided Hedging
Agreement” shall not include any Hedging Agreement or transactions under any Hedging Agreement entered into after the time
that such Counterparty ceases to be a Lender or an Affiliate of a Lender.

 

“Letter of Credit” means
any letter of credit issued pursuant to this Agreement.

 

“LIBO Rate” means, with
respect to any Eurodollar Borrowing for any Interest Period, the rate appearing on Reuters Screen LIBOR01 Page (or on any successor
or substitute page of such service, or any successor to or substitute for such service, providing rate quotations comparable to
those currently provided on such page of such service, as determined by the Administrative Agent from time to time for purposes
of providing quotations of interest rates applicable to Dollar deposits in the London interbank market) at approximately 11:00
a.m., London time, two Business Days prior to the commencement of such Interest Period. If for any reason such rate is not available,
“LIBO Rate” shall be, for any such interest period, the rate per annum reasonably determined by the Administrative
Agent as the rate of interest at which Dollar deposits in the approximate amount of the LIBOR loan comprising part of such borrowing
would be offered by the Administrative Agent to major banks in the London interbank Eurodollar market at or about 10:00 a.m. (Atlanta,
Georgia time) two Business Days prior to the first day of such Interest Period for a term comparable to such Interest Period.

 

“Lien” means, with respect
to any asset, (a) any mortgage, deed of trust, lien, pledge, hypothecation, encumbrance, charge or security interest in, on
or of such asset, (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention
agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such assets,
(c) production payments and the like payable out of Oil and Gas Properties and (d) in the case of securities, any purchase
option, call or similar right of a third party with respect to such securities.

 

“Loan Document” means
this Agreement, the Guarantee and Collateral Agreement, the Security Documents, the Revolving Notes, the LC Applications, the Intercreditor
Agreement and any other documents entered into in connection herewith.

 

“Loan Party” means each
of the Borrower and each Guarantor.

 

“Loans” means the loans
made by the Lenders to the Borrower pursuant to this Agreement.

 

“Majority Lenders” means,
at any time while no Loans or LC Exposure is outstanding, Lenders having greater than 50% of the Aggregate Maximum Credit Amounts;
and at any time while any Loans or LC Exposure is outstanding, Lenders holding greater than 50% of the outstanding aggregate principal
amount of the Loans or participation interests in Letters of Credit (without regard to any sale by a Lender of a participation
in any Loan under Section 9.4(d)); provided that (a) at any time there are three or fewer Lenders, the percent
shall be 66-2/3%, and (b) the Maximum Credit Amounts and the principal amount of the Loans and participation interests in Letters
of Credit of the Defaulting Lenders shall be excluded from the determination of Majority Lenders.

 

    	18

    	 

    

 

“Material Adverse Effect”
means a material adverse effect on (a) the business, assets, operations, property or financial condition, of the Borrower
and the Restricted Subsidiaries taken as a whole, (b) the ability of any Loan Party to perform any of its obligations under
the Loan Documents in all material respects, (c) the validity or enforceability of any of the Loan Documents, or (d) the rights
of or benefits or remedies available to the Administrative Agent, the Issuing Banks and the Lenders under the Loan Documents.

 

“Material Indebtedness”
means Indebtedness (other than the Loans and Letters of Credit), or obligations in respect of one or more Hedging Agreements, of
any one or more of the Borrower and its Restricted Subsidiaries in an aggregate principal amount exceeding $10,000,000. For purposes
of determining Material Indebtedness, the “principal amount” of the obligations of the Borrower or any Restricted Subsidiary
in respect of any Hedging Agreement at any time shall be the maximum aggregate amount (after giving effect to legally enforceable
netting obligations) that the Borrower or such Restricted Subsidiary would be required to pay if such Hedging Agreement were terminated
at such time.

 

“Maturity Date” means
August 27, 2019 or any earlier date on which the Commitments are terminated pursuant to the terms hereof.

 

“Maximum Credit Amount”
means, as to each Lender, the amount set forth opposite such Lender’s name on Schedule 2.1 under the caption “Maximum
Credit Amounts”, as the same may be (a) reduced or terminated from time to time in connection with a reduction or termination
of the Aggregate Maximum Credit Amounts pursuant to Section 2.8, or (b) modified from time to time pursuant to any
assignment permitted by Section 9.4 or (c) increased from time to time pursuant to Section 2.1(b).

 

“Minimum Cash Collateral Amount”
means, at any time, (a) with respect to Cash Collateral consisting of cash or deposit account balances, an amount equal to 105%
of the Fronting Exposures of all Issuing Banks with respect to Letters of Credit issued and outstanding at such time and (b) otherwise,
an amount determined by the Administrative Agent and the Issuing Banks in their sole discretion.

 

“Moody’s” means
Moody’s Investors Service, Inc.

 

“Mortgage” means a mortgage
or deed of trust made by any Loan Party in favor of, or for the benefit of, the Administrative Agent for the benefit of the holders
of Secured Obligations, substantially in the form of Exhibit F (with such changes thereto acceptable to the Administrative
Agent as shall be advisable under the law of the jurisdiction in which such mortgage or deed of trust is to be recorded).

 

“Mortgaged Property”
means any Property owned by the Borrower or any Guarantor that is subject to the Liens existing and to exist under the terms any
Mortgage.

 

“Multiemployer Plan”
means a multiemployer plan as defined in Section 4001(a)(3) of ERISA.

 

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“Net Cash Proceeds” means,
(a) with respect to any Disposition of any Oil and Gas Properties (including any Equity Interests of any Restricted Subsidiary
owning Oil and Gas Properties) by the Borrower or any Restricted Subsidiary, the excess, if any, of (i) the sum of cash and cash
equivalents received in connection with such Disposition, but only as and when so received, over (ii) the sum of (A) the principal
amount of any Indebtedness that is secured by such Oil and Gas Properties and that is senior to the Liens securing the Secured
Obligations and required to be repaid in connection with such Disposition (other than the Loans), (B) the out-of-pocket costs and
expenses incurred by the Borrower or such Restricted Subsidiary in connection with such Disposition, (C) all legal, title and recording
tax expense and all federal, state, provincial, foreign and local Taxes required to be accrued as a liability under GAAP as a consequence
of such Disposition, (D) all distributions and other payments required to be made to minority interest holders in Restricted Subsidiaries
as a result of such Disposition, (E) the deduction of appropriate amounts provided by the seller as a reserve, in accordance with
GAAP, against any liabilities associated with the Property Disposed of in such Disposition and retained by the Borrower or any
Restricted Subsidiary after such Disposition, (F) cash payments made to satisfy obligations resulting from Hedge Liquidations or
the early termination of any Hedge Agreements in connection with or as a result of any such Disposition of Oil and Gas Properties,
and (G) any portion of the purchase price from such Disposition placed in escrow, whether as a reserve for adjustment of the purchase
price, for satisfaction of indemnities in respect of such Disposition or otherwise in connection with such Disposition; provided,
however, that upon the termination of that escrow, Net Cash Proceeds will be increased by any portion of funds in the escrow
that are released to the Borrower or any Restricted Subsidiary, (b) with respect to any Hedge Liquidation by any Loan Party, the
excess, if any, of (i) the sum of cash and cash equivalents received in connection with such Hedge Liquidation (after giving
effect to any netting arrangements), over (ii) the out-of-pocket expenses incurred by such Loan Party in connection with such Hedge
Liquidation and (c) with respect to any Equity Issuance, the cash proceeds thereof, net of customary fees, commissions, costs and
other expenses incurred in connection therewith.

 

“New Borrowing Base Notice”
has the meaning assigned such term in Section 2.4(d).

 

“Non-Consenting Lender”
means any Lender that does not approve any consent, waiver or amendment to any provision of this Agreement or any other Loan Document
requested by the Administrative Agent or the Borrower that (a) requires the approval of all Lenders or all affected Lenders in
accordance with the terms of Section 9.2(b) and (b) has been approved by the Required Lenders.

 

“Non-Defaulting Lender”
means, at any time, each Lender that is not a Defaulting Lender at such time.

 

“Non-Recourse Debt” means
Indebtedness:

 

(a)          as
to which neither the Borrower nor any of its Restricted Subsidiaries (i) provides credit support of any kind (including any undertaking,
agreement or instrument that would constitute Indebtedness), (ii) is directly or indirectly liable as a guarantor or otherwise,
or (iii) constitutes the lender;

 

    	20

    	 

    

 

(b)          no
default with respect to which (including any rights that the holders thereof may have to take enforcement action against an Unrestricted
Subsidiary) would permit upon notice, lapse of time or both any holder of any other Indebtedness of the Borrower or any of its
Restricted Subsidiaries to declare a default on such other Indebtedness or cause the payment thereof to be accelerated or payable
prior to its stated maturity; and

 

(c)          as
to which the lenders have been notified in writing that they will not have any recourse to the stock or assets of the Borrower
or any of its Restricted Subsidiaries.

 

“Obligations” means all
advances to, and debts, liabilities, obligations, covenants and duties of, any Loan Party arising under any Loan Document, or otherwise
with respect to any Loan or Letter of Credit, in each case whether direct or indirect (including those acquired by assumption),
absolute or contingent, due or to become due, now existing or hereafter arising and including interest and fees that accrue after
the commencement by or against any Loan Party or any Affiliate thereof of any proceeding under any Debtor Relief Law naming such
Person as the debtor in such proceeding, regardless of whether such interest and fees are allowed claims in such proceeding. Notwithstanding
the foregoing, Excluded Hedging Obligations shall not be an Obligation of any Guarantor that is not a Qualified ECP Guarantor.
For the avoidance of doubt, no obligation of any kind of the Borrower or any of its Subsidiaries to any Permitted Secured Note
Holder pursuant to any Permitted Secured Note Document, or to any party to any Permitted Refinancing Document, shall ever be included
within the Obligations.

 

“OFAC” is defined in
Section 3.23.

 

“Off-Balance Sheet Liability”
of a Person means (a) any repurchase obligation or liability of such Person with respect to accounts or notes receivable sold by
such Person, (b) any liability under any sale and leaseback transaction which is not a Capital Lease Obligation, (c) any indebtedness,
liability or obligation under any so-called “synthetic lease” transaction entered into by such Person, (d) any Advance
Payment Contract, or (e) any indebtedness, liability or obligation arising with respect to any other transaction which is the functional
equivalent of or takes the place of borrowing but which does not constitute a liability on the balance sheets of such Person, but
excluding from the foregoing clauses (c) through (e) operating leases and usual and customary oil, gas and mineral
leases.

 

“Oil and Gas Properties”
means (a) Hydrocarbon Interests; (b) the Properties now or hereafter pooled or unitized with Hydrocarbon Interests; (c) all presently
existing or future unitization, pooling agreements and declarations of pooled units and the units created thereby (including without
limitation all units created under orders, regulations and rules of any Governmental Authority) which may affect all or any portion
of the Hydrocarbon Interests; (d) all operating agreements, contracts and other agreements, including production sharing contracts
and agreements, which relate to any of the Hydrocarbon Interests or the production, sale, purchase, exchange or processing of Hydrocarbons
from or attributable to such Hydrocarbon Interests; (e) all Hydrocarbons in and under and which may be produced and saved or attributable
to the Hydrocarbon Interests, including all oil in tanks, and all rents, issues, profits, proceeds, products, revenues and other
incomes from or attributable to the Hydrocarbon Interests; (f) all tenements, hereditaments, appurtenances and Properties in any
manner appertaining, belonging, affixed or incidental to the Hydrocarbon Interests and (g) all Properties, rights, titles, interests
and estates described or referred to above, including any and all Property, real or personal, now owned or hereinafter acquired
and situated upon, used, held for use or useful in connection with the operating, working or development of any of such Hydrocarbon
Interests or Property (excluding drilling rigs, automotive equipment, rental equipment or other personal Property which may be
on such premises for the purpose of drilling a well or for other similar temporary uses) and including any and all oil wells, gas
wells, injection wells or other wells, buildings, structures, fuel separators, liquid extraction plants, plant compressors, pumps,
pumping units, field gathering systems, tanks and tank batteries, fixtures, valves, fittings, machinery and parts, engines, boilers,
meters, apparatus, equipment, appliances, tools, implements, cables, wires, towers, casing, tubing and rods, surface leases, rights-of-way,
easements and servitudes together with all additions, substitutions, replacements, accessions and attachments to any and all of
the foregoing. Unless otherwise indicated herein, each reference to the term “Oil and Gas Properties” shall mean Oil
and Gas Properties of the Borrower and/or the Restricted Subsidiaries as the context requires.

 

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“Organization Documents”
means, (a) with respect to any corporation, the certificate or articles of incorporation and the bylaws; (b) with respect to any
limited liability company, the articles of formation and operating agreement; and (c) with respect to any partnership, joint venture,
trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation and any agreement,
instrument, filing or notice with respect thereto filed in connection with its formation with the secretary of state or other department
in the state of its formation, in each case as amended from time to time.

 

“Other Connection Taxes”
means, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the
jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to,
performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other
transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).

 

“Other Taxes” means all
present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made
under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security
interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed
with respect to an assignment (other than an assignment made pursuant to Section 2.20(b).

 

“Participant” is defined
in Section 9.4(d).

 

“Participant Register”
is defined in Section 9.4(d).

 

“PATRIOT Act” means the
“Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001”
(Title III of Pub. L. 107-56 (signed into law October 26, 2001)).

 

“PBGC” means the Pension
Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity performing similar functions.

 

    	22

    	 

    

 

“Pension Plan” means
any employee pension benefit plan (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412
of the IRC or Section 302 of ERISA, and in respect of which the Borrower or any ERISA Affiliate is (or, if such plan were
terminated, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of
ERISA.

 

“Permitted Encumbrances”
means:

 

(a)          Liens
for Taxes, assessments or other governmental charges or levies which are not delinquent or which are being contested in good faith
by appropriate action and for which adequate reserves have been maintained in accordance with GAAP;

 

(b)          Liens
in connection with workers’ compensation, unemployment insurance or other social security, old age pension or public liability
obligations which are not delinquent or which are being contested in good faith by appropriate action and for which adequate reserves
have been maintained in accordance with GAAP;

 

(c)          statutory
landlord’s liens, operators’, vendors’, carriers’, warehousemen’s, repairmen’s, mechanics’,
suppliers’, workers’, materialmen’s, construction or other like Liens arising by operation of law in the ordinary
course of business or incident to the exploration, development, operation and maintenance of Oil and Gas Properties each of which
is in respect of obligations that are not delinquent or which are being contested in good faith by appropriate action and for which
adequate reserves have been maintained in accordance with GAAP;

 

(d)          contractual
Liens which arise in the ordinary course of business under operating agreements, joint venture agreements, oil and gas partnership
agreements, oil and gas leases, farm-out agreements, division orders, contracts for the sale, transportation or exchange of oil
and natural gas, unitization and pooling declarations and agreements, area of mutual interest agreements, marketing agreements,
processing agreements, development agreements, injection, repressuring and recycling agreements, salt water or other disposal agreements,
seismic or other geophysical permits or agreements, and other agreements which are usual and customary in the oil and gas business
and are for claims which are not delinquent or which are being contested in good faith by appropriate action and for which adequate
reserves have been maintained in accordance with GAAP, that are taken into account in computing the net revenue interests and working
interests of the Borrower or any of its Restricted Subsidiaries warranted in the Security Documents or this Agreement, provided
that any such Lien referred to in this clause does not materially impair the use of the Property covered by such Lien for the purposes
for which such Property is held by the Borrower or any Subsidiary or materially impair the value of such Property subject thereto;

 

(e)          Liens
arising solely by virtue of any statutory or common law provision relating to banker’s liens, rights of set-off or similar
rights and remedies and burdening only deposit accounts or other funds maintained with a creditor depository institution, provided
that no such deposit account is a dedicated Cash Collateral account or is subject to restrictions against access by the depositor
in excess of those set forth by regulations promulgated by the Board and no such deposit account is intended by Borrower or any
of its Subsidiaries to provide collateral to the depository institution;

 

    	23

    	 

    

 

(f)          easements,
restrictions, servitudes, permits, conditions, covenants, exceptions or reservations in any Property of the Borrower or any Subsidiary
for the purpose of roads, pipelines, transmission lines, transportation lines, distribution lines for the removal of gas, oil,
water, coal or other minerals or timber, and other like purposes, or for the joint or common use of real estate, rights of way,
facilities and equipment, which in the aggregate do not materially impair the use of such Property for the purposes of which such
Property is held by the Borrower or any Subsidiary or materially impair the value of such Property subject thereto;

 

(g)          Liens
on cash or securities pledged to secure performance of tenders, surety and appeal bonds, government contracts, performance and
return of money bonds, bids, trade contracts, leases, statutory obligations, regulatory obligations and other obligations of a
like nature incurred in the ordinary course of business;

 

(h)          judgment
and attachment Liens not giving rise to an Event of Default, provided that any appropriate legal proceedings which may have
been duly initiated for the review of such judgment shall not have been finally terminated or the period within which such proceeding
may be initiated shall not have expired and no action to enforce such Lien has been commenced;

 

(i)          consents
to assignment and similar contractual provisions affecting an Oil and Gas Property to the extent and only to the extent, such consents
are not affected by the execution and delivery of any Security Document;

 

(j)          Liens
arising from Uniform Commercial Code financing statement filings regarding operating leases entered into by the Borrower and the
Restricted Subsidiaries in the ordinary course of business covering only the Property under lease;

 

provided, further that (i) Liens described in
clauses (a) through (e) shall remain “Permitted Encumbrances” only for so long as no action to enforce
such Lien has been commenced and (ii) no intention to subordinate the first priority Lien granted in favor of the Administrative
Agent and the Lenders is to be hereby implied or expressed by the permitted existence of any Permitted Encumbrance.

 

    	24

    	 

    

 

“Permitted Refinancing Debt”
means senior or senior subordinated Indebtedness (whether registered or privately placed), issued by the Borrower, in each case
whether secured or unsecured, issued or incurred by the Borrower pursuant to Permitted Refinancing Documents (for purposes of this
definition, “new Debt”) incurred in exchange for, or proceeds of which are used to refinance, all of the Permitted
Secured Notes Facility (the “Refinanced Debt”); provided that (a) such new Debt is in an aggregate principal
amount not in excess of the sum of (i) the outstanding principal amount of Permitted Secured Debt being refinanced and (ii) an
amount necessary to pay any fees and expenses, including premiums, and accrued and unpaid interest related to such exchange or
refinancing; (b) such new Debt does not have any scheduled per annum principal amortization in excess of the per annum amortization
provided in the Permitted Secured Notes Agreement (as in effect on the Effective Date) prior to the date which is 180 days after
the Maturity Date as in effect on the date such new Debt is incurred; (c) such new Debt does not have a final maturity date or
date of mandatory redemption in full, as applicable, sooner than the date which is 180 days after the Maturity Date as in effect
on the date such new Debt is incurred; (d) the non-default interest rate on the outstanding principal amount of such new Debt does
not exceed the non-default interest rate applicable to the Refinanced Debt on the date such new Debt is incurred plus 3% and does
not add scheduled recurring fees or add call or prepayment premiums or shorten any period for the payment of interest; (e) no Subsidiary
or other Person is required to guarantee such new Debt unless such Subsidiary or other Person has guaranteed the Obligations pursuant
to the Guarantee and Collateral Agreement; (f) if such new Debt is senior subordinated Indebtedness, such new Debt is expressly
subordinate to the payment in full of all of the Obligations on terms and conditions reasonably satisfactory to the Administrative
Agent; (g) if such new Debt is unsecured Indebtedness, then such new Debt and any guarantees thereof are on terms, taken as a whole,
at least as favorable to the Borrower and the Subsidiaries as market terms for issuers of similar size and credit quality given
the then prevailing market conditions as reasonably determined by the Borrower; (h) the financing documentation entered into by
the Borrower and its Subsidiaries in connection therewith shall constitute Permitted Refinancing Documents; (i) such new Debt
does not have any mandatory prepayment, defeasance, tender, repurchase, sinking fund or redemption provisions (other than (i) customary
change of control or asset sale tender offer provisions and provisions requiring prepayment from the net cash proceeds of certain
debt issuances, in each case to the extent to required to be applied first to the Obligations to the extent required by this Agreement
and (ii) redemption permitted by clause (c) above); (j) such new Debt shall not require the payment of a consent fee
(howsoever described) in excess of 2% per annum of the outstanding principal amount of the new Debt; (k) such new Debt is not redeemable
at the option of the holder thereof (other than solely for Equity Interests that are not otherwise Disqualified Equity Interests)
prior to the date which is 180 days after the Maturity Date as in effect on the date such new Debt is incurred and (l) if such
new Debt is secured, such Liens are permitted by Section 6.3(f).

 

“Permitted Refinancing Documents”
means any financing documentation which replaces the Permitted Secured Notes Agreement or the Permitted Secured Notes Documents,
pursuant to which the outstanding Permitted Secured Debt is refinanced in its entirety by the incurrence of Permitted Refinancing
Debt; provided that, in the case of any Permitted Refinancing Debt that is secured Indebtedness, such financing documentation
shall contain only those terms, conditions, covenants and defaults that exist in the Permitted Secured Notes Agreement or the Permitted
Secured Notes Documents at the time of the incurrence of such Permitted Refinancing Debt, and/or such terms, conditions, covenants
or defaults that could be included in the Permitted Secured Notes Agreement or the Permitted Secured Notes Documents, as the case
may be, by an amendment or other modification that would not be prohibited by the terms of the Intercreditor Agreement at the time
of the incurrence of such Permitted Refinancing Debt, as the same may be amended, modified or supplemented in accordance with Section 6.2(l).

 

“Permitted Secured Debt”
means any Indebtedness issued pursuant to Section 6.2(k).

 

“Permitted Secured Notes Agent”
means U.S. Bank National Association, in its capacity as collateral agent under the Permitted Secured Notes Agreement, and includes
each other Person that is subsequently appointed as the successor collateral agent pursuant to the Permitted Secured Notes Agreement.

 

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“Permitted Secured Notes Agreement”
means the Indenture dated as of August 27, 2014, between the Borrower and the Permitted Secured Notes Agent, as amended, restated,
replaced, supplemented or otherwise modified from time to time as permitted under this Agreement.

 

“Permitted Secured Notes Documents”
means the “Note Documents,” as defined in the Permitted Secured Notes Agreement, as the same shall be amended, supplemented
or otherwise modified from time to time in accordance with Section 6.14, which shall include the Permitted Refinancing
Documents.

 

“Permitted Secured Notes Facility”
means debt facility evidenced by the Permitted Secured Notes Agreement.

 

“Permitted Secured Notes Holders”
means the registered holders of the “Notes,” as defined in the Permitted Secured Notes Agreement.

 

“Permitted Third Party Bank”
shall mean any bank or other financial institution with whom any Loan Party maintains a Controlled Account and with whom a Control
Account Agreement has been executed.

 

“Person” means any natural
person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority
or other entity.

 

“Plan” means any employee
benefit plan (as defined in Section 3(3) of ERISA, including a Pension Plan), maintained by, contributed to by or required
to be contributed to by any Loan Party or with respect to which any Loan Party may have any liability.

 

“Property” means any
interest in any kind of property or asset, whether real, personal or mixed, or tangible or intangible, including without limitation,
cash, securities, accounts and contract rights.

 

“Proposed Borrowing Base”
has the meaning assigned to such term in Section 2.4(c)(i).

 

“Proposed Borrowing Base Notice”
has the meaning assigned to such term in Section 2.4(c)(ii).

 

“PV-9 Value” shall mean,
as of any date of determination, with respect to the Borrower and its Restricted Subsidiaries, the present value of estimated future
revenues less severance and ad valorem taxes, operating, gathering, transportation and marketing expenses and capital expenditures
from the production of proved Oil and Gas Properties of the Borrower and its Restricted Subsidiaries as set forth in the most recent
Reserve Report delivered pursuant hereto, adjusted for any basis differential, quality and gravity, using prices and costs as of
the date of estimation without future escalation, without giving effect to non-property related expenses such as general and administrative
expenses, debt service, future income tax expense and depreciation, depletion and amortization, and discounted using an annual
discount rate of 9%. PV-9 Value shall be adjusted to give effect to the Hedging Agreements with Approved Counterparties then in
effect.

 

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“Qualified ECP Guarantor”
means, in respect of any Lender Provided Hedging Agreement, each Loan Party that has total assets exceeding $10,000,000 at the
time such Lender Provided Hedging Agreement is incurred or such other person as constitutes an “eligible contract participant”
under the Commodity Exchange Act or any regulation promulgated thereunder.

 

“Recipient” means (a)
the Administrative Agent, (b) any Lender and (c) any Issuing Bank, as applicable.

 

“Recovery Event” means
any settlement of or payment in respect of any property or casualty insurance claim or any condemnation proceeding relating to
any asset of any Loan Party.

 

“Redemption” means with
respect to any Indebtedness, the repurchase, redemption, prepayment, repayment or defeasance (or the segregation of funds with
respect to any of the foregoing) of such Indebtedness. “Redeem” has the correlative meaning thereto.

 

“Redetermination Date”
means, with respect to any Scheduled Redetermination or any Interim Redetermination, the date that the redetermined Borrowing Base
related thereto becomes effective pursuant to Section 2.4(d).

 

“Register” is defined
in Section 9.4(c).

 

“Regulation U” means
Regulation U of the FRB.

 

“Related Parties” means,
with respect to any Person, such Person’s Affiliates and the partners, directors, officers, employees, agents, trustees,
administrators, managers, advisors and representatives of such Person and of such Person’s Affiliates.

 

“Removal Effective Date”
is defined in Section 8.6.

 

“Required Deficiency Payment”
means, for each Borrowing Base Deficiency Payment Date occurring after a Borrowing Base Deficiency Determination Date in accordance
with the terms hereof, an amount equal to one-sixth of the Borrowing Base deficiency (plus accrued interest thereon) existing
on the Borrowing Base Deficiency Determination Date; provided, that if the amount of the Borrowing Base deficiency has increased
after the Borrowing Base Deficiency Determination Date then each remaining Required Deficiency Payment shall be increased to substantially
equal amounts sufficient to reduce to zero the Borrowing Base deficiency on or before the Final Borrowing Base Deficiency Payment
Date (after giving effect to the Required Deficiency Payment made on such date).

 

“Required Engineered Value”
means 80% of the PV-9 Value of the “proved” Oil and Gas Properties evaluated in the most recent Reserve Report delivered
to the Lenders.

 

“Required Lenders” means,
at any time while no Loans or LC Exposure is outstanding, Lenders having at least 66-2⁄3% of the Aggregate Maximum Credit Amounts;
and at any time while any Loans or LC Exposure is outstanding, Lenders holding at least 66-2⁄3% of the outstanding aggregate
principal amount of the Loans or participation interests in such Letters of Credit (without regard to any sale by a Lender of a
participation in any Loan under Section 9.4(d)); provided that (a) at any time there are three or fewer Lenders,
the percent shall be 100%, and (b) the Maximum Credit Amounts and the principal amount of the Loans and participation interests
in Letters of Credit of the Defaulting Lenders shall be excluded from the determination of Required Lenders.

 

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“Reserve Percentage”
means, on any day with respect to each particular Borrowing comprised of LIBO Rate Loans, the maximum reserve requirement as determined
by the Administrative Agent (including without limitation any basic, supplemental, marginal, emergency or similar reserves and
taking into account any transitional adjustments or other scheduled changes in reserve requirements), expressed as a fraction,
which would then apply under Regulation D with respect to “Eurocurrency liabilities” (as such term is defined in Regulation
D) equal in amount to each Lender’s LIBO Rate Loan in such Borrowing, were such Lender to have any such “Eurocurrency
liabilities”. If such reserve requirement shall change after the date hereof, the Reserve Percentage shall be automatically
increased or decreased, as the case may be, from time to time as of the effective time of each such change in such reserve requirement.

 

“Reserve Report” means
the Initial Reserve Report and a report, in form and substance reasonably satisfactory to the Administrative Agent, setting forth,
as of each December 31st or June 30th (or as of such other date in the event of an Interim Redetermination) the oil and
gas reserves attributable to the Oil and Gas Properties of the Borrower and the Restricted Subsidiaries, together with a projection
of the rate of production and future net income, taxes, operating expenses and capital expenditures with respect thereto as of
such date, consistent with SEC reporting requirements and pricing at the time, in each case reflecting Hedging Agreements in place
with respect to such production.

 

“Resignation Effective Date”
is defined in Section 8.6.

 

“Responsible Officer”
means the chief executive officer, chief operating officer, president or Financial Officer of the Borrower.

 

“Restricted Payment”
means (a) any dividend or other distribution (whether in cash, securities or other property) with respect to any Equity Interests
in the Borrower or any Restricted Subsidiary, or any payment (whether in cash, securities or other property), including any sinking
fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such
Equity Interests in the Borrower or any option, warrant or other right to acquire any such Equity Interests in the Borrower and
(b) any payment of management fees or similar fees by the Borrower or any Restricted Subsidiary to any of its equityholders or
any Affiliate thereof.

 

“Restricted Person” is
defined in Section 3.23.

 

“Restricted Subsidiary”
means each Subsidiary of the Borrower that is not designated as an Unrestricted Subsidiary pursuant to Section 1.7.

 

“Revolving Note” is defined
in Section 2.9(e).

 

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“S&P” means Standard
& Poor’s Ratings Services, a unit of The McGraw-Hill Companies, Inc.

 

“Scheduled Redetermination”
has the meaning assigned such term in Section 2.4(b).

 

“Scheduled Redetermination Date”
means the date on which a Borrowing Base that has been redetermined pursuant to a Scheduled Redetermination becomes effective as
provided in Section 2.4(d).

 

“SEC” means the Securities
and Exchange Commission or any Governmental Authority succeeding to any of its principal functions.

 

“Secured Obligations”
means, collectively, (a) the Obligations and (b) all obligations of any Loan Party under any Lender Provided Hedging Agreement
or any Lender Provided Financial Service Product, in each case whether direct or indirect (including those acquired by assumption),
absolute or contingent, due or to become due, now existing or hereafter arising and including interest and fees that accrue after
the commencement by or against any Loan Party or any Affiliate thereof of any proceeding under any Debtor Relief Law naming such
Person as the debtor in such proceeding, regardless of whether such interest and fees are allowed claims in such proceeding. Notwithstanding
the foregoing, Excluded Hedging Obligations shall not be a Secured Obligation of any Guarantor that is not a Qualified ECP Guarantor.

 

“Security Documents”
means the Guarantee and Collateral Agreement, the Mortgages and all other security documents hereafter delivered to the Administrative
Agent granting a Lien on any property of any Person to secure the Secured Obligations.

 

“Specified Indebtedness”
means all Indebtedness for borrowed money, all Capital Lease Obligations, and all Disqualified Equity Interests, in each case,
of the Borrower and the Restricted Subsidiaries.

 

“Subsidiary” means, with
respect to any Person, any other Person the accounts of which would be consolidated with those of such Person in such Person’s
consolidated financial statements if such financial statements were prepared in accordance with GAAP as well as any other Person
(a) of which securities or other ownership interests representing more than 50% of the equity or more than 50% of the ordinary
voting power or, in the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned,
controlled or held, by such Person or (b) that is, as of such date, otherwise Controlled by such Person. Unless the context
otherwise specifically requires, the term “Subsidiary” shall refer to a Subsidiary of the Borrower.

 

“Subsidiary Guarantor”
means any Domestic Subsidiary that guarantees the Secured Obligations (including pursuant to Section 4.1 and Section
5.9).

 

“Taxes” means all present
or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges
imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

 

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“Termination Date” means
the first date on or before which all Obligations (other than contingent indemnification obligations for which no claim has been
asserted and without regard to whether any obligations remain outstanding under any Lender Provided Hedging Agreement or Lender
Provided Financial Service Product) have been indefeasibly paid in full in cash, all Letters of Credit have been terminated or
expired (or been Cash Collateralized), and all Commitments shall have terminated.

 

“Total Debt” means, at
any date, all Indebtedness of the Borrower and its Restricted Subsidiaries on a consolidated basis, other than of the type described
in items (e) and (l) of the definition of “Indebtedness,” minus, for the remainder of fiscal year ended
December 31, 2014, the sum of all unrestricted cash balances in excess of $10,000,000 held on such date.

 

“Transactions” means
the execution, delivery and performance by the Loan Parties of the Loan Documents, the borrowing of Loans, the use of the proceeds
thereof and the issuance of Letters of Credit hereunder, the grant by any Loan Party of the Liens granted by it pursuant to the
Loan Documents to which it is a party, and the perfection or maintenance of the Liens created under the Loan Documents to which
it is a party.

 

“Type”, when used in
reference to any Loan or Borrowing, refers to whether the rate of interest on such Loan, or on the Loans comprising such Borrowing,
is determined by reference to the Adjusted LIBO Rate or the Alternate Base Rate.

 

“U.S. Person” means any
Person that is a “United States Person” as defined in Section 7701(a)(30) of the IRC.

 

“U.S. Tax Compliance Certificate”
is defined in Section 2.17(g).

 

“Unrestricted Subsidiary”
means each Subsidiary of the Borrower designated by the Borrower as an Unrestricted Subsidiary in accordance with, and subject
to the satisfaction of the conditions set forth in, Section 1.7.

 

“Voting Equity Interest”
means, as to any Person, an Equity Interest in such Person having ordinary voting power with respect to the board of directors
or other governing body of such Person.

 

“Wholly Owned Subsidiary”
means, as to any Person, any Restricted Subsidiary all of the Equity Interests of which (other than directors’ qualifying
shares required by law) are owned by such Person directly and/or through other Wholly Owned Subsidiaries.

 

“Wholly Owned Subsidiary Guarantor”
means any Subsidiary Guarantor that is a Wholly Owned Subsidiary of the Borrower.

 

“Withholding Agent” means
any Loan Party and the Administrative Agent.

 

Section 1.2           Classification
of Loans and Borrowings. For purposes of this Agreement, Loans may be classified and referred to by Type (e.g., a “Eurodollar
Loan”). Borrowings also may be classified and referred to by Type (e.g., a “Eurodollar Borrowing”).

 

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Section 1.3           Terms
Generally; Rules of Construction. The definitions of terms herein shall apply equally to the singular and plural forms of the
terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms.
The words “include,” “includes” and “including” shall be deemed to be followed by the phrase
“without limitation.” The word “will” shall be construed to have the same meaning and effect as the word
“shall.” Unless the context requires otherwise, (a) any definition of or reference to any agreement, instrument or
other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein),
(b) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (c) the words
“herein,” “hereof” and “hereunder,” and words of similar import, shall be construed to refer
to this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Articles, Sections,
Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement,
(e) any reference to any law or regulation herein shall, unless otherwise specified, refer to such law or regulation as amended,
modified or supplemented from time to time and (f) the words “asset” and “property” shall be construed
to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash,
securities, accounts and contract rights.

 

Section 1.4           Accounting
Terms and Determinations; GAAP. Except as otherwise expressly provided herein, all terms of an accounting or financial nature
shall be construed in accordance with GAAP, as in effect from time to time; provided that, if the Borrower notifies the
Administrative Agent that the Borrower requests an amendment to any provision hereof to eliminate the effect of any change occurring
after the date hereof in GAAP or in the application thereof on the operation of such provision (or if the Administrative Agent
notifies the Borrower that the Majority Lenders request an amendment to any provision hereof for such purpose), regardless of whether
any such notice is given before or after such change in GAAP or in the application thereof, then such provision shall be interpreted
on the basis of GAAP as in effect and applied immediately before such change shall have become effective until such notice shall
have been withdrawn or such provision amended in accordance herewith. Notwithstanding any other provision contained herein, all
terms of an accounting or financial nature used herein shall be construed, and all computations of amounts and ratios referred
to herein shall be made (a) without giving effect to any election under Accounting Standards Codification 825-10-25 (previously
referred to as Statement of Financial Accounting Standards 159) (or any other Accounting Standards Codification or Financial Accounting
Standard having a similar result or effect), to value any Indebtedness or other liabilities of the Borrower or any Subsidiary at
“fair value,” as defined therein, (b) without giving effect to any treatment of Indebtedness in respect of convertible
debt instruments under Accounting Standards Codification 470-20, to value any such Indebtedness in a reduced or bifurcated manner
as described therein, and such Indebtedness shall at all times be valued at the full stated principal amount thereof and (c) without
giving effect to any change to lease accounting rules from those in effect on the date hereof pursuant to Accounting Standards
Codification 840 and other lease accounting guidance as in effect on the date hereof.

 

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Section 1.5           Oil
and Gas Definitions. For purposes of this Agreement and the other Loan Documents, the terms “proved reserves,”
“proved developed reserves,” “proved undeveloped reserves,” “proved developed nonproducing reserves”
and “proved developed producing reserves,” have the meaning given such terms from time to time and at the time in question
by the Society of Petroleum Engineers of the American Institute of Mining Engineers.

 

Section 1.6           Time
of Day. Unless otherwise specified, all references herein to time of day shall be references to Atlanta, Georgia time (daylight
or standard, as applicable).

 

Section 1.7           Designation
and Conversion of Restricted and Unrestricted Subsidiaries.

 

(a)          Unless
designated in writing to the Administrative Agent by the Borrower and approved by the Administrative Agent and the Majority Lenders
in accordance with clause (b) below, any Person that becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries
(whether by formation, acquisition or merger) shall be classified as a Restricted Subsidiary.

 

(b)          Any
Subsidiary of the Borrower (including a newly formed or newly acquired Subsidiary) may be designated (or redesignated) as an Unrestricted
Subsidiary if (i) the Administrative Agent shall have received (1) a written request from the Borrower specifying the applicable
Subsidiary and such other information as the Administrative Agent may reasonably request, (2) the written consent of the Administrative
Agent and the Majority Lenders approving such designation, and (3) a certificate of a Responsible Officer of the Borrower certifying
that the condition set forth in Section 1.7(b)(ii) is satisfied as of the date of such designation and that no Default or
Event of Default shall then exist or would result from such designation (after giving effect to such designation) (and, as a condition
precedent to the effectiveness of any such designation, the Borrower shall deliver to the Administrative Agent a certificate setting
forth in reasonable detail the calculations demonstrating compliance on a pro forma basis with the covenants set forth in Section 6.1),
(ii) the representations and warranties of Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are
true and correct on and as of such date as if made on and as of the date of such designation (or, if stated to have been made expressly
as of an earlier date, were true and correct as of such date), (iii) such designation is deemed to be an Investment in an amount
equal to the fair market value of Borrower’s direct and indirect ownership interest in such Subsidiary and such Investment
would be permitted under Section 6.6 to be made at the time of such designation and (iv) such Subsidiary is in compliance
with the requirements of Section 5.15. Except as provided in this Section 1.7, no Subsidiary may be designated
(and no Restricted Subsidiary may be redesignated) as an Unrestricted Subsidiary.

 

(c)          If,
at any time, any Unrestricted Subsidiary would fail to meet the requirements for an Unrestricted Subsidiary set forth in Section
5.15, it shall thereafter cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness of such
Subsidiary shall be deemed to be incurred by a Restricted Subsidiary of the Borrower as of such date and, if such Indebtedness
is not permitted to be incurred as of such date under Section 6.2, the Borrower shall be in default of such covenant.

 

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(d)          Borrower
may designate any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) the representations
and warranties of Borrower and its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and
as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier
date, were true and correct as of such date), (ii) no Default or Event of Default then exists or would result from such redesignation
(after giving effect to such redesignation), (iii) the designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall
constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time, and
the Borrower is in compliance with Sections 6.2 and 6.3 after giving effect to such designation, and (iv) the Borrower
complies, or causes such Subsidiary to comply, with the requirements of Section 5.9. Any such designation shall be
evidenced by a certificate of a Responsible Officer of the Borrower delivered to the Administrative Agent prior to such designation
certifying that the conditions of this Section 1.7(d) are satisfied as of the date of such designation (and, as a condition
precedent to the effectiveness of any such designation, the Borrower shall deliver to the Administrative Agent a certificate setting
forth in reasonable detail the calculations demonstrating compliance on a pro forma basis with the covenants set forth in Section 6.1).

 

(e)          No
Subsidiary may be designated as an Unrestricted Subsidiary hereunder unless it is also designated as an “Unrestricted Subsidiary”
for purposes of any Permitted Secured Notes Documents, and no Subsidiary designated as an Unrestricted Subsidiary may be designated
as a Restricted Subsidiary hereunder unless it is also designated as a “Restricted Subsidiary” for purposes of any
Permitted Secured Notes Documents.

 

ARTICLE
II

The Credits

 

Section 2.1           Commitments.
(a) Agreement to make Loans. Subject to the terms and conditions set forth herein, each Lender agrees to make Loans to the
Borrower from time to time during the Availability Period in an aggregate principal amount that will not result in such Lender’s
Credit Exposure exceeding such Lender’s Commitment then in effect by making immediately available funds available to the
Administrative Agent’s designated account, not later than 11:00 a.m.; provided, however, notwithstanding anything
herein to the contrary, on the Effective Date, availability hereunder shall be limited to $35,000,000, and may be increased over
time pursuant to Section 2.1(b). Within the foregoing limits and subject to the terms and conditions set forth herein, the
Borrower may borrow, prepay and reborrow Loans.

 

(b)          Increase
in Maximum Credit Amounts.

 

(i)          Request
for Increase. Provided there exists no Default, upon notice to the Administrative Agent (which shall promptly notify the Lenders),
the Borrower may from time to time request an increase in the Maximum Credit Amounts by an amount (for all such requests) not exceeding
$25,000,000; provided that any such request for an increase shall be in a minimum amount of $5,000,000. At the time of sending
such notice, the Borrower (in consultation with the Administrative Agent) shall specify the time period within which each Lender
is requested to respond (which shall in no event be less than ten Business Days from the date of delivery of such notice to the
Lenders).

 

(ii)         Lender
Elections To Increase. Each Lender shall notify the Administrative Agent within such time period whether or not it agrees to increase
its Maximum Credit Amounts and, if so, whether by an amount equal to, greater than or less than its Applicable Percentage of such
requested increase. Any Lender not responding within such time period shall be deemed to have declined to increase its Maximum
Credit Amounts.

 

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(iii)        Notification
by Administrative Agent; Additional Lenders. The Administrative Agent shall notify the Borrower and each Lender of the Lenders’
responses to each request made hereunder. To achieve the full amount of a requested increase and subject to the approval of the
Administrative Agent and the Issuing Banks (which approvals shall not be unreasonably withheld), the Borrower may also invite additional
Eligible Assignees to become Lenders pursuant to a joinder agreement in form and substance satisfactory to the Administrative Agent
and its counsel.

 

(iv)        Increase
Effective Date and Allocations. If the Maximum Credit Amounts are increased in accordance with this Section, the Administrative
Agent and the Borrower shall determine the effective date (the “Increase Effective Date”) and the final allocation
of such increase. The Administrative Agent shall promptly notify the Borrower and the Lenders of the final allocation of such increase
and the Increase Effective Date.

 

(v)         Conditions
to Effectiveness of Increase. As a condition precedent to such increase, the Borrower shall deliver to the Administrative Agent
a certificate of each Loan Party dated as of the Increase Effective Date (in sufficient copies for each Lender) signed by the Responsible
Officer of such Loan Party (A) certifying and attaching the resolutions adopted by such Loan Party approving or consenting to such
increase and (B) in the case of the Borrower, certifying that, before and after giving effect to such increase, (1) the representations
and warranties contained in Article III and the other Loan Documents are true and correct in all material respects on and as of
the Increase Effective Date, except to the extent that such representations and warranties specifically refer to an earlier date,
in which case they were true and correct in all material respects as of such earlier date and (2) no Default exists. The Borrower
shall prepay any Loans outstanding on the Increase Effective Date (and pay any additional amounts required pursuant to Section
2.16) to the extent necessary to keep the outstanding Revolving Loans ratable with any revised Applicable Percentages arising
from any nonratable increase in the Maximum Credit Amounts under this Section.

 

Section 2.2           Loans
and Borrowings. (a)  Each Loan shall be made as part of a Borrowing consisting of Loans of the same Type made by
the Lenders ratably in accordance with their respective Commitments. The failure of any Lender to make any Loan required to be
made by it shall not relieve any other Lender of its obligations hereunder.

 

(b)          Subject
to Section 2.13, each Borrowing shall be comprised entirely of Base Rate Loans or Eurodollar Loans as the Borrower
may request in accordance with this Agreement. Each Lender at its option may make any Eurodollar Loan by causing any domestic or
foreign branch or Affiliate of such Lender to make such Loan; provided that any exercise of such option shall not affect
the obligation of the Borrower to repay such Loan in accordance with the terms of this Agreement.

 

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(c)          At
the commencement of each Interest Period for any Eurodollar Borrowing, such Borrowing shall be in an aggregate amount that is an
integral multiple of $100,000 and not less than $500,000. At the time that each Base Rate Borrowing is made, such Borrowing shall
be in an aggregate amount that is an integral multiple of $100,000 and not less than $500,000; provided that a Base Rate
Borrowing may be in an aggregate amount that is equal to the entire unused balance of the total Commitments then in effect or that
is required to finance the reimbursement of an LC Disbursement as contemplated by Section 2.5(e). Borrowings of more
than one Type may be outstanding at the same time; provided that there shall not at any time be more than a total of eight
Eurodollar Borrowings outstanding.

 

(d)          Notwithstanding
any other provision of this Agreement, the Borrower shall not be entitled to request, or to elect to convert or continue any Borrowing
as, a Eurodollar Borrowing if the Interest Period requested with respect thereto would end after the Maturity Date.

 

Section 2.3           Requests
for Borrowings. To request a Borrowing, the Borrower shall notify the Administrative Agent of such request by telephone (a) in
the case of a Eurodollar Borrowing, not later than 11:00 a.m. three Business Days before the date of the proposed Borrowing or
(b) in the case of a Base Rate Borrowing, not later than 11:00 a.m. one Business Day before the date of the proposed Borrowing;
provided that any such notice of a Base Rate Borrowing to finance the reimbursement of an LC Disbursement as contemplated
by Section 2.5(e) may be given not later than 10:00 a.m. on the date of the proposed Borrowing. Each such telephonic
Borrowing Request shall be irrevocable and shall be confirmed promptly by hand delivery, telecopy or (if arrangements for doing
so have been approved by the Administrative Agent) electronic communication to the Administrative Agent of a written Borrowing
Request in a form approved by the Administrative Agent and signed by the Borrower. Each such telephonic and written Borrowing Request
shall specify the following information in compliance with Section 2.2:

 

(i)          the
aggregate amount of the requested Borrowing;

 

(ii)         the
date of such Borrowing, which shall be a Business Day;

 

(iii)        whether
such Borrowing is to be a Base Rate Borrowing or a Eurodollar Borrowing;

 

(iv)        in
the case of a Eurodollar Borrowing, the initial Interest Period to be applicable thereto, which shall be a period contemplated
by the definition of the term “Interest Period”;

 

(v)         the
amount of the then effective Borrowing Base, the current total Credit Exposures (without regard to the requested Borrowing) and
the pro forma total Credit Exposures (giving effect to the requested Borrowing); and

 

(vi)        the
location and number of the Borrower’s account to which funds are to be disbursed, which shall comply with the requirements
of Section 2.6.

 

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If no election as to the Type of Borrowing is specified, then
the requested Borrowing shall be a Base Rate Borrowing. If no Interest Period is specified with respect to any requested Eurodollar
Borrowing, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration. Promptly following
receipt of a Borrowing Request in accordance with this Section, the Administrative Agent shall advise each Lender of the details
thereof and of the amount of such Lender’s Loan to be made as part of the requested Borrowing. Each Borrowing Request shall
constitute a representation that the amount of the requested Borrowing shall not cause the total Credit Exposures to exceed the
total Commitments (i.e., the lesser of the Aggregate Maximum Credit Amounts and the then effective Borrowing Base).

 

Section 2.4           Borrowing
Base.

 

(a)          Initial
Borrowing Base. For the period from and including the Effective Date to but excluding the initial Redetermination Date, the
amount of the Borrowing Base shall be $60,000,000. Notwithstanding the foregoing, the Borrowing Base may be subject to further
adjustments from time to time pursuant to this Section 2.4.

 

(b)          Scheduled
and Interim Redeterminations.

 

(i)          The
Borrowing Base shall be redetermined semi-annually in accordance with this Section 2.4 (a “Scheduled Redetermination”),
and, subject to Section 2.4(d), such redetermined amount shall become effective and applicable to the Borrower, the
Agents, each Issuing Bank and the Lenders on or around April 1st and October 1st of each year.

 

(ii)         In
addition, the Borrower may, by notifying the Administrative Agent thereof, and the Administrative Agent may, at the direction of
the Required Lenders, by notifying the Borrower thereof, two times during each one year period, elect any of the foregoing amounts
to be redetermined between Scheduled Redeterminations in accordance with this Section 2.4.

 

(c)          Scheduled
and Interim Redetermination Procedure.

 

(i)          Each
Scheduled Redetermination and each Interim Redetermination shall be effectuated as follows: Upon receipt by the Administrative
Agent of (A) the Reserve Report and the certificate required to be delivered by the Borrower to the Administrative Agent, in the
case of a Scheduled Redetermination, pursuant to Section 5.13(a) and (c), and, in the case of an Interim Redetermination,
pursuant to Section 5.13(b) and (c), (B) such other reports, data and supplemental information, including, without
limitation, the information provided pursuant to Section 5.13(c), as may, from time to time, be reasonably requested
by the Required Lenders (the Reserve Report, such certificate and such other reports, data and supplemental information being the
“Engineering Reports”), and (C) if applicable, written notice to the Administrative Agent stating that the Borrower
intends to terminate or cancel its position under specific Hedging Agreements (“Hedging Cancellation Notice”),
the Administrative Agent shall evaluate the information contained in the Engineering Reports and Hedging Cancellation Notice, if
any, and shall, in good faith, propose a new Borrowing Base (all such amounts being the “Proposed Borrowing Base”)
based upon such information and such other information (including, without limitation, the status of title information with respect
to the Oil and Gas Properties as described in the Engineering Reports and the existence of any other Indebtedness) as the Administrative
Agent deems appropriate in its sole discretion and consistent with its normal oil and gas lending criteria as it exists at the
particular time.

 

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(ii)         The
Administrative Agent shall notify the Borrower and the Lenders of the Proposed Borrowing Base (the “Proposed Borrowing
Base Notice”):

 

(1)         in
the case of a Scheduled Redetermination (1) if the Administrative Agent shall have received the Engineering Reports required to
be delivered by the Borrower pursuant to Section 5.13(a) and (c) and, if applicable, a Hedging Cancellation Notice
in a timely and complete manner, then on or before the March 15th and September 15th of such year following the date
of delivery or (2) if the Administrative Agent shall not have received the Engineering Reports required to be delivered by the
Borrower pursuant to Section 5.13(a) and (c) and applicable Hedging Cancellation Notice in a timely and complete manner,
then promptly after the Administrative Agent has received complete Engineering Reports and applicable Hedging Cancellation Notice
from the Borrower and has had a reasonable opportunity to determine the Proposed Borrowing Base in accordance with Section 2.4(c)(i);
and

 

(2)         in
the case of an Interim Redetermination, promptly, and in any event, within 15 days after the Administrative Agent has received
the required Engineering Reports and applicable Hedging Cancellation Notice.

 

(iii)        Any
Proposed Borrowing Base that would increase the Borrowing Base then in effect must be approved by all the Lenders as provided in
this Section 2.4(c)(iii) and the Borrower; and any Proposed Borrowing Base that would decrease or maintain the Borrowing
Base then in effect must be approved or be deemed to have been approved by the Required Lenders as provided in this Section 2.4(c)(iii).
Upon receipt of the Proposed Borrowing Base Notice, each Lender shall have 15 days to agree with the Proposed Borrowing Base or
disagree with the Proposed Borrowing Base by proposing an alternate Borrowing Base. If, at the end of such 15 days (A) in the case
of any Proposed Borrowing Base that would decrease or maintain the Borrowing Base then in effect, any Lender has not communicated
its approval or disapproval in writing to the Administrative Agent, such silence shall be deemed to be an approval of the Proposed
Borrowing Base and (B) in the case of any Proposed Borrowing Base that would increase the Borrowing Base then in effect, any Lender
has not communicated its approval or disapproval in writing to the Administrative Agent, such silence shall be deemed to be a disapproval
of the Proposed Borrowing Base. If, at the end of such 15-day period, all Lenders, in the case of a Proposed Borrowing Base that
would increase the Borrowing Base then in effect, or the Required Lenders, in the case of a Proposed Borrowing Base that would
decrease or maintain the Borrowing Base then in effect, have approved or, in the case of a decrease or reaffirmation, deemed to
have approved, as aforesaid, then the Proposed Borrowing Base shall become the new Borrowing Base, effective on the date specified
in Section 2.4(d).

 

(iv)        If,
however, at the end of such 15-day period, all of the Lenders or the Required Lenders, as applicable, have not approved or, in
the case of a decrease or reaffirmation, deemed to have approved, as aforesaid, then the Administrative Agent shall poll the Lenders
to ascertain the highest Borrowing Base then acceptable to (A) in the case of a decrease or reaffirmation, a number of Lenders
sufficient to constitute the Required Lenders and (B) in the case of an increase, all of the Lenders, and such amount shall become
the new Borrowing Base effective on the date specified in Section 2.4(d).

 

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(d)          Effectiveness
of a Redetermined Borrowing Base. After a redetermined Borrowing Base is approved or is deemed to have been approved by the
Required Lenders or all Lenders, as applicable, pursuant to Section 2.4(c)(iii), the Administrative Agent shall notify
the Borrower and the Lenders (the “New Borrowing Base Notice”), and such amount (or amounts, as applicable)
shall become the new Borrowing Base, effective and applicable to the Borrower, the Agents, each Issuing Bank and the Lenders:

 

(i)          in
the case of a Scheduled Redetermination, (A) if the Administrative Agent shall have received the Engineering Reports required to
be delivered by the Borrower pursuant to Section 5.13(a) and (c) and, if applicable, a Hedging Cancellation Notice,
in a timely and complete manner, then on or around April 1st or October 1st, as applicable, following such notice Scheduled
Redetermination, or (B) if the Administrative Agent shall not have received the Engineering Reports required to be delivered by
the Borrower pursuant to Section 5.13(a) and (c), if applicable, a Hedging Cancellation Notice, in a timely and complete
manner, then on the Business Day next succeeding delivery of such notice; and

 

(ii)         in
the case of an Interim Redetermination, on the Business Day next succeeding delivery of such notice.

 

Such amount shall then become the Borrowing Base until the next
Scheduled Redetermination Date, the next Interim Redetermination Date or the next adjustment, to the extent applicable, under Sections 2.4(f),
(g), or (h) whichever occurs first. Notwithstanding the foregoing, no Scheduled Redetermination or Interim Redetermination
shall become effective until the New Borrowing Base Notice related thereto is received by the Borrower.

 

(e)          [intentionally
omitted]

 

(f)          Reduction
of Borrowing Base Upon Termination of Hedge Positions. If at any time between two successive Scheduled Redetermination Dates
(or, in the case of any such event occurring prior to October 1, 2014, the period from the Effective Date to October 1, 2014),
the aggregate Hedging Termination Value of all terminations and/or offsetting positions of Hedge Liquidations by the Borrower and
its Restricted Subsidiaries during said period, and the Borrowing Base value of any Disposals of Oil and Gas Properties (whether
pursuant to a Disposition of Equity Interests of a Restricted Subsidiary or otherwise) by the Loan Parties pursuant to Section 6.5(d)
exceeds 5% of the then effective Borrowing Base, then the Administrative Agent shall, at the direction of the Required Lenders,
by notifying the Borrower thereof, elect to redetermine the Borrowing Base in accordance with this Section 2.4, and the
Borrowing Base as so reduced shall become the new Borrowing Base immediately upon such redetermination, effective and applicable
to the Borrower, the Administrative Agent, the Issuing Bank and the Lenders until the next redetermination or adjustment of the
Borrowing Base pursuant to this Agreement. Upon any such redetermination, the Administrative Agent shall promptly deliver a New
Borrowing Base Notice to the Borrower and the Lenders.

 

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(g)          Reduction
of Borrowing Base Upon Unsatisfactory Title. If at any time the Borrower does not satisfy the title requirements of Section 5.14,
then the Administrative Agent may redetermine the Borrowing Base pursuant to Section 5.14(c), and the Borrowing Base
as so reduced shall become the new Borrowing Base immediately upon such redetermination, effective and applicable to the Borrower,
the Administrative Agent, the Issuing Bank and the Lenders until the next redetermination or adjustment of the Borrowing Base pursuant
to this Agreement. Upon any such redetermination, the Administrative Agent shall promptly deliver a New Borrowing Base Notice to
the Borrower and the Lenders.

 

(h)          Reduction
of Borrowing Base Upon Asset Dispositions. If at any time between two successive Scheduled Redeterminations of the Borrowing
Base (or, in the case of any such event occurring prior to October 1, 2014, the period from the Effective Date to October 1, 2014),
the aggregate Borrowing Base value of Oil and Gas Properties Disposed of (whether pursuant to a Disposition of Equity Interests
of a Restricted Subsidiary or otherwise) by the Loan Parties pursuant to Section 6.5(d) exceeds, when aggregated with
the Hedging Termination Value of all Hedge Liquidations during such period, 5% of the then effective Borrowing Base, then the Administrative
Agent shall, at the direction of the Required Lenders, by notifying the Borrower thereof, elect to redetermine the Borrowing Base
in accordance with this Section 2.4, and the Borrowing Base as so reduced shall become the new Borrowing Base immediately
upon such redetermination, effective and applicable to the Borrower, the Administrative Agent, the Issuing Bank and the Lenders
until the next redetermination or adjustment of the Borrowing Base pursuant to this Agreement. Upon any such redetermination, the
Administrative Agent shall promptly deliver a New Borrowing Base Notice to the Borrower and the Lenders.

 

(i)          Increase
of Borrowing Base Upon Asset Acquisitions. The Borrower may propose additional Oil and Gas Properties of the Borrower and any
Guarantor constituting proved reserves acquired from time to time, with an aggregate acquisition price of at least 5% of the then
effective Borrowing Base, be included in the calculation of the Borrowing Base subject to terms and provisions of this Section 2.4,
by the Borrower (i) giving written notice to the Administrative Agent of such properties to be included, (ii) subjecting such properties
to liens securing the Obligations (pursuant to Security Documents satisfactory to the Administrative Agent), (iii) including such
properties in a Reserve Report submitted to the Administrative Agent and (iv) delivering to the Administrative Agent title opinions
or other title materials covering all of such properties and other legal opinions in form, scope and substance acceptable to the
Administrative Agent.

 

(j)          Lenders’
Sole Discretion. The Lenders shall have no obligation to determine the Borrowing Base at any particular amount, either in relation
to the Aggregate Maximum Credit Amounts or otherwise. Furthermore, Borrower acknowledges that the Lenders have no obligation to
increase the Borrowing Base and that any increase in the Borrowing Base is in each Lender’s sole discretion and subject to
the individual credit approval processes of each of the Lenders which processes shall be conducted in good faith and based upon
such information and such other information (including, without limitation, the status of title information with respect to the
Oil and Gas Properties as described in the Engineering Reports, the existence of any other Indebtedness, the financial condition
of the Loan Parties, the economic effect of the Borrower’s and its Restricted Subsidiaries’ Hedging Agreements then
in effect and such other credit factors) as such Lender deems appropriate in its sole discretion and consistent with its normal
oil and gas lending criteria as it exists at the particular time.

 

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Section 2.5           Letters
of Credit.

 

(a)          General.
Subject to the terms and conditions set forth herein, each Issuing Bank agrees, in reliance upon the agreements of the Lenders
set forth in this Section, (i) from time to time on any Business Day during the Availability Period, to issue Letters of Credit,
in forms reasonably acceptable to the Administrative Agent and such Issuing Bank, for the account of the Borrower or any of its
Subsidiaries and to amend or extend Letters of Credit previously issued by it, in accordance with Section 2.5(b) and
(ii) to honor drawings under the Letters of Credit; provided that no Issuing Bank shall be obligated to issue any Letter
of Credit or to amend or extend any Letter of Credit if, after giving effect thereto, (x) the total Credit Exposures would exceed
the total Commitments then in effect or (y) the LC Exposure would exceed the LC Sublimit. Letters of Credit shall constitute utilization
of the Commitments. In the event of any inconsistency between the terms and conditions of this Agreement and the terms and conditions
of any LC Application or other agreement submitted by the Borrower or any Restricted Subsidiary to, or entered into by the Borrower
or any Restricted Subsidiary with, any Issuing Bank relating to any Letter of Credit, the terms and conditions of this Agreement
shall control. Each notice shall constitute a representation that after giving effect to the requested issuance, amendment, renewal
or extension, as applicable, (i) the LC Exposure shall not exceed the LC Sublimit and (ii) the total Credit Exposures shall not
exceed the total Commitments (i.e., the lesser of the Aggregate Maximum Credit Amounts and the then effective Borrowing
Base).

 

(b)          Notice
of Issuance, Amendment, Extension; Certain Conditions. To request the issuance of a Letter of Credit (or the amendment or extension
of an outstanding Letter of Credit), the Borrower or the applicable Restricted Subsidiary shall hand deliver or telecopy (or if
arrangements for doing so have been approved the Administrative Agent and by the applicable Issuing Bank, electronic communication)
to such Issuing Bank and the Administrative Agent (reasonably in advance of the requested date of issuance, amendment or extension)
a notice requesting the issuance of a Letter of Credit, or identifying the Letter of Credit to be amended or extended, and specifying
(i) the date of issuance, amendment or extension (which shall be a Business Day), (ii) the date on which such Letter of Credit
is to expire (which shall comply with clause (c) of this Section), (iii) the amount of such Letter of Credit, (iv)
the name and address of the beneficiary thereof, (v) specifying the amount of the then effective Borrowing Base, the current total
Credit Exposures (without regard to the requested Letter of Credit or the requested amendment, renewal or extension of an outstanding
Letter of Credit) and the pro forma total Credit Exposures (giving effect to the requested Letter of Credit or the requested amendment,
renewal or extension of an outstanding Letter of Credit) and (vi) such other information as shall be necessary to prepare, amend
or extend such Letter of Credit. The form of any requested Letter of Credit or any requested amendment or extension of a Letter
of Credit shall be reasonably acceptable to the applicable Issuing Bank. No Issuing Bank shall be obligated to issue any Letter
of Credit (i) in violation of any Applicable Law or policy of such Issuing Bank or any Lender, (ii) if any order, judgment or decree
of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain such Issuing Bank from issuing such
Letter of Credit, (iii) except as otherwise agreed by the Administrative Agent and such Issuing Bank, if such Letter of Credit
is in an initial stated amount less than $50,000, (iv) if such Letter of Credit is to be denominated in a currency other than Dollars
or (v) if such Letter of Credit contains any provision for automatic reinstatement of the stated amount after any drawing thereunder.
If requested by the applicable Issuing Bank, the Borrower or the applicable Restricted Subsidiary also shall submit an LC Application
in connection with any request for a Letter of Credit. A Letter of Credit shall be issued, amended or extended only if (and upon
issuance, amendment or extension of each Letter of Credit the Borrower shall be deemed to represent and warrant that), after giving
effect to such issuance, amendment or extension (i) the LC Exposure shall not exceed the LC Sublimit, (ii) the total
Credit Exposures shall not exceed the total Commitments then in effect and (iii) the other conditions thereto set forth
in this Agreement are met. No Issuing Bank shall be under any obligation to amend or extend any Letter of Credit if (i) such Issuing
Bank would have no obligation at such time to issue the Letter of Credit in its amended form under the terms hereof or (ii) the
beneficiary of such Letter of Credit does not accept the proposed amendment thereto.

 

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(c)          Expiration
Date. Each Letter of Credit shall expire at or prior to the close of business on the earlier of (i) the date one year
after the date of the issuance of such Letter of Credit (or, in the case of any extension thereof, one year after such extension)
and (ii) the date that is five Business Days prior to the Maturity Date; provided that any Letter of Credit may, with
the consent of the applicable Issuing Bank, be automatically extendable for successive one-year periods (which shall in no event
extend beyond the date referred to in the foregoing clause (ii)).

 

(d)          Participations.
By the issuance of a Letter of Credit (or an amendment to a Letter of Credit increasing the amount thereof) and without any further
action on the part of any Issuing Bank or the Lenders, each applicable Issuing Bank hereby grants to each Lender, and each Lender
hereby acquires from such Issuing Bank, a participation in such Letter of Credit equal to such Lender’s Applicable Percentage
of the aggregate amount available to be drawn under such Letter of Credit. Each Lender hereby absolutely and unconditionally agrees
to pay to the Administrative Agent, for the account of the applicable Issuing Bank, such Lender’s Applicable Percentage of
each LC Disbursement made by such Issuing Bank and not reimbursed by the Borrower on the date due as provided in clause (e)
of this Section, or of any reimbursement payment required to be refunded to the Borrower for any reason. Each Lender agrees that
its obligation to acquire participations pursuant to this Section 2.5(d) in respect of Letters of Credit is absolute
and unconditional and shall not be affected by any circumstance whatsoever, including any amendment or extension of any Letter
of Credit or the occurrence and continuance of a Default or reduction or termination of the Commitments, and that each such payment
shall be made without any offset, abatement, withholding or reduction whatsoever.

 

(e)          Reimbursement.
If any Issuing Bank shall make any LC Disbursement in respect of a Letter of Credit, the Borrower shall reimburse such LC Disbursement
by paying to the Administrative Agent an amount equal to such LC Disbursement not later than 12:00 noon on the date that such LC
Disbursement is made, if the Borrower shall have received notice of such LC Disbursement prior to 10:00 a.m. on such date, or,
if such notice has not been received by the Borrower prior to such time on such date, then not later than 12:00 noon on (i) the
Business Day that the Borrower receives such notice, if such notice is received prior to 10:00 a.m. on the day of receipt, or (ii)
the Business Day immediately following the day that the Borrower receives such notice, if such notice is not received prior to
such time on the day of receipt; provided that the Borrower may, subject to the conditions to borrowing set forth herein,
request in accordance with Section 2.3 or 2.4 that such payment be financed with a Base Rate Borrowing in an
equivalent amount and, to the extent so financed, the Borrower’s obligation to make such payment shall be discharged and
replaced by the resulting Base Rate Borrowing. If the Borrower fails to make such payment when due, the Administrative Agent shall
notify each Lender of the applicable LC Disbursement, the payment then due from the Borrower in respect thereof and such Lender’s
Applicable Percentage thereof. Promptly following receipt of such notice, each Lender shall pay to the Administrative Agent its
Applicable Percentage of the payment then due from the Borrower, in the same manner as provided in Section 2.6 with
respect to Loans made by such Lender (and Section 2.6 shall apply, mutatis mutandis, to the payment obligations
of the Lenders), and the Administrative Agent shall promptly pay to the applicable Issuing Bank the amounts so received by it from
the Lenders. Promptly following receipt by the Administrative Agent of any payment from the Borrower pursuant to this Section 2.5(e),
the Administrative Agent shall distribute such payment to the applicable Issuing Bank or, to the extent that Lenders have made
payments pursuant to this Section 2.5(e) to reimburse such Issuing Bank, then to such Lenders and such Issuing Bank
as their interests may appear. Any payment made by a Lender pursuant to this Section 2.5(e) to reimburse any Issuing
Bank for any LC Disbursement (other than the funding of Base Rate Loans as contemplated above) shall not constitute a Loan and
shall not relieve the Borrower of its obligation to reimburse such LC Disbursement.

 

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(f)          Obligations
Absolute. The Borrower’s obligation to reimburse LC Disbursements as provided in clause (e) of this Section
shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement
under any and all circumstances whatsoever and irrespective of (i) any lack of validity or enforceability of any Letter of Credit
or this Agreement, or any term or provision therein, (ii) any draft or other document presented under a Letter of Credit proving
to be forged, fraudulent or invalid in any respect or any statement therein being untrue or inaccurate in any respect, (iii) payment
by any Issuing Bank under a Letter of Credit against presentation of a draft or other document that does not comply with the terms
of such Letter of Credit or (iv) any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that
might, but for the provisions of this Section, constitute a legal or equitable discharge of, or provide a right of recoupment or
setoff against, the Borrower’s Obligations hereunder. None of the Administrative Agent, the Lenders or any Issuing Bank,
or any of their Related Parties, shall have any liability or responsibility by reason of or in connection with the issuance or
transfer of any Letter of Credit or any payment or failure to make any payment thereunder (irrespective of any circumstance referred
to in the preceding sentence), or any error, omission, interruption, loss or delay in transmission or delivery of any draft, notice
or other communication under or relating to any Letter of Credit (including any document required to make a drawing thereunder),
any error in interpretation of technical terms or any consequence arising from causes beyond the control of any Issuing Bank; provided
that the foregoing shall not be construed to excuse any Issuing Bank from liability to the Borrower to the extent of any direct
damages (as opposed to indirect, special, punitive, consequential or exemplary damages, claims in respect of which are hereby waived
by the Borrower to the extent permitted by Applicable Law) suffered by the Borrower that are caused by such Issuing Bank’s
failure to exercise care when determining whether drafts and other documents presented under a Letter of Credit comply with the
terms thereof. The parties hereto expressly agree that, in the absence of gross negligence or willful misconduct on the part of
such Issuing Bank (as determined in a final and non-appealable judgment by a court of competent jurisdiction), such Issuing Bank
shall be deemed to have exercised care in each such determination. In furtherance of the foregoing and without limiting the generality
thereof, the parties hereto expressly agree that the applicable Issuing Bank may, in its sole discretion, either accept documents
that appear on their face to be in substantial compliance with the terms of the related Letter of Credit, without responsibility
for further investigation, regardless of any notice or information to the contrary, or refuse to accept and make payment upon such
documents if such documents are not in strict compliance with the terms of such Letter of Credit, and such Issuing Bank shall not
be responsible for the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign
a Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid
or ineffective for any reason.

 

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(g)          Disbursement
Procedures. Each Issuing Bank shall, promptly following its receipt thereof, examine all documents purporting to represent
a demand for payment under a Letter of Credit issued by it. Such Issuing Bank shall promptly notify the Administrative Agent and
the Borrower by telephone (confirmed by telecopy or, if arrangements for doing so have been approved by the Administrative Agent,
electronic communication) of such demand for payment and whether such Issuing Bank has made or will make an LC Disbursement thereunder;
provided that any failure to give or delay in giving such notice shall not relieve the Borrower of its obligation to reimburse
such Issuing Bank and the Lenders with respect to any such LC Disbursement.

 

(h)          Interim
Interest. If any Issuing Bank shall make any LC Disbursement, then, unless the Borrower shall reimburse such LC Disbursement
in full on the date such LC Disbursement is made, the unpaid amount thereof shall bear interest, for each day from and including
the date such LC Disbursement is made to but excluding the date that the Borrower reimburses such LC Disbursement, at the rate
per annum then applicable to Base Rate Loans; provided that, if the Borrower fails to reimburse such LC Disbursement when
due pursuant to clause (e) of this Section, then Section 2.12(c) shall apply. Interest accrued pursuant
to this clause (h) shall be for the account of the applicable Issuing Bank, except that interest accrued on and after
the date of payment by any Lender pursuant to clause (e) of this Section to reimburse such Issuing Bank shall be for
the account of such Lender to the extent of such payment.

 

(i)          Replacement
of Issuing Banks. Any Issuing Bank may be replaced at any time by written agreement among the Borrower, the Administrative
Agent, the replaced Issuing Bank and the successor Issuing Bank. The Administrative Agent shall notify the Lenders of any such
replacement of an Issuing Bank. At the time any such replacement shall become effective, the Borrower shall pay all unpaid fees
accrued for the account of the replaced Issuing Bank pursuant to Section 2.11(b)(ii). From and after the effective
date of any such replacement, (i) the successor Issuing Bank shall have all the rights and obligations of an Issuing Bank under
this Agreement with respect to Letters of Credit to be issued thereafter and (ii) references herein to the term “Issuing
Bank” shall be deemed to refer to such successor or to any previous Issuing Bank, or to such successor and all previous Issuing
Banks, as the context shall require. After the replacement of an Issuing Bank hereunder, the replaced Issuing Bank shall remain
a party hereto and shall continue to have all the rights and obligations of an Issuing Bank under this Agreement with respect to
Letters of Credit issued by it prior to such replacement, but shall not be required to issue additional Letters of Credit.

 

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(j)          Cash
Collateralization. If any Event of Default shall occur and be continuing, on the Business Day that the Borrower receives notice
from the Administrative Agent or the Majority Lenders (or, if the maturity of the Loans has been accelerated, Lenders with LC Exposures
representing greater than 50% of the aggregate LC Exposure) demanding the deposit of Cash Collateral pursuant to this clause (j),
the Borrower shall deposit in an account with the Administrative Agent, in the name of the Administrative Agent and for the benefit
of the Issuing Banks and the Lenders, an amount in cash equal to 105% of the LC Exposure as of such date; provided that
the obligation to deposit such Cash Collateral shall become effective immediately, and such deposit shall become immediately due
and payable without demand or other notice of any kind, upon the occurrence of any Event of Default with respect to the Borrower
described in Sections 7.1 (h) or (i). Such deposit shall be held by the Administrative Agent as collateral for the
payment and performance of the Obligations. The Borrower hereby grants to the Administrative Agent, for the benefit of the Issuing
Banks and the Lenders, and agrees to maintain, a first priority security interest in all such Cash Collateral to secure the Secured
Obligations, free and clear of all other Liens (other than Liens securing the Permitted Secured Notes or the Permitted Refinancing
Debt). The Administrative Agent shall have exclusive dominion and control, including the exclusive right of withdrawal, over such
Cash Collateral account and the amounts deposited therein shall not bear interest. Moneys in such Cash Collateral account shall
be applied by the Administrative Agent to reimburse the Issuing Banks for LC Disbursements for which they have not been reimbursed
and, to the extent not so applied, shall be held for the satisfaction of the reimbursement obligations of the Borrower for the
LC Exposure at such time or, if the maturity of the Loans has been accelerated (but subject to the consent of Lenders with LC Exposures
representing greater than 50% of the aggregate LC Exposure), shall be applied to satisfy other Obligations. If the Borrower is
required to provide an amount of Cash Collateral hereunder as a result of the occurrence of an Event of Default, such amount (to
the extent not applied as aforesaid) shall be returned to the Borrower within three Business Days after all Events of Default have
been cured or waived. Following the Termination Date, the balance, if any, in such Cash Collateral account shall be returned to
the Borrower (or such other Person as may be lawfully entitled thereto).

 

(k)          Applicability
of ISP98 and UCP. Unless otherwise expressly agreed by the applicable Issuing Bank and the Borrower when a Letter of Credit
is issued, (i) the rules of ISP98 shall apply to each standby Letter of Credit, and (ii) the rules of the Uniform Customs and Practice
for Documentary Credits, as most recently published by the International Chamber of Commerce at the time of issuance, shall apply
to each commercial Letter of Credit.

 

(l)          Letters
of Credit Issued for Subsidiaries. Notwithstanding that a Letter of Credit issued or outstanding hereunder is in support of
any obligations of, or is for the account of, a Restricted Subsidiary, the Borrower shall be obligated to reimburse the applicable
Issuing Bank hereunder for any and all drawings under such Letter of Credit. The Borrower hereby acknowledges that the issuance
of Letters of Credit for the account of any Restricted Subsidiary inures to the benefit of the Borrower, and that the Borrower’s
business derives substantial benefits from the business of such Restricted Subsidiary.

 

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Section 2.6           Funding
of Borrowings. (a) Each Lender shall make each Loan to be made by it hereunder on the proposed date thereof by wire transfer
of immediately available funds by 12:00 noon to the account of the Administrative Agent most recently designated by it for such
purpose by notice to the Lenders. The Administrative Agent will make such Loans available to the Borrower by promptly crediting
the amounts so received, in like funds, to an account of the Borrower maintained with the Administrative Agent in Atlanta, Georgia
and designated by the Borrower in the applicable Borrowing Request; provided that Base Rate Loans made to finance the reimbursement
of an LC Disbursement as provided in Section 2.5(e) shall be remitted by the Administrative Agent to the applicable
Issuing Bank.

 

(b)          Unless
the Administrative Agent shall have received notice from a Lender prior to the proposed date of any Borrowing that such Lender
will not make available to the Administrative Agent such Lender’s share of such Borrowing, the Administrative Agent may assume
that such Lender has made such share available on such date in accordance with clause (a) of this Section and may,
in reliance upon such assumption, make available to the Borrower a corresponding amount. In such event, if a Lender has not in
fact made its share of the applicable Borrowing available to the Administrative Agent, then the applicable Lender and the Borrower
severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount with interest thereon, for each
day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Administrative
Agent, at (i) in the case of such Lender, the greater of the Federal Funds Effective Rate and a rate determined by the Administrative
Agent in accordance with banking industry rules on interbank compensation or (ii) in the case of the Borrower, the interest rate
applicable to Base Rate Loans. If such Lender pays such amount to the Administrative Agent, then such amount shall constitute such
Lender’s Loan included in such Borrowing. If the Borrower and such Lender shall pay such interest to the Administrative Agent
for the same or an overlapping period, the Administrative Agent shall promptly remit to the Borrower the amount of such interest
paid by the Borrower for such period. Any payment by the Borrower shall be without prejudice to any claim the Borrower may have
against a Lender that shall have failed to make such payment to the Administrative Agent.

 

Section 2.7           Interest
Elections. (a) Each Borrowing initially shall be of the Type specified in the applicable Borrowing Request and, in the case
of a Eurodollar Borrowing, shall have an initial Interest Period as specified in such Borrowing Request or as otherwise specified
in Section 2.3. Thereafter, the Borrower may elect to convert such Borrowing to a different Type or to continue such
Borrowing and, in the case of a Eurodollar Borrowing, may elect Interest Periods therefor, all as provided in this Section. The
Borrower may elect different options with respect to different portions of the affected Borrowing, in which case each such portion
shall be allocated ratably among the Lenders holding the Loans comprising such Borrowing, and the Loans comprising each such portion
shall be considered a separate Borrowing.

 

(b)          To
make an election pursuant to this Section, the Borrower shall notify the Administrative Agent of such election by telephone by
the time that a Borrowing Request would be required under Section 2.3 if the Borrower were requesting a Borrowing of
the Type resulting from such election to be made on the effective date of such election. Each such telephonic Interest Election
Request shall be irrevocable and shall be confirmed promptly by hand delivery or telecopy (or, if arrangements for doing so have
been approved by the Administrative Agent, electronic communication) to the Administrative Agent of a written Interest Election
Request in a form approved by the Administrative Agent and signed by the Borrower.

 

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(c)          Each
telephonic and written Interest Election Request shall specify the following information in compliance with Section 2.2:

 

(i)          the
Borrowing to which such Interest Election Request applies and, if different options are being elected with respect to different
portions thereof, the portions thereof to be allocated to each resulting Borrowing (in which case the information to be specified
pursuant to clauses (iii) and (iv) below shall be specified for each resulting Borrowing);

 

(ii)         the
effective date of the election made pursuant to such Interest Election Request, which shall be a Business Day;

 

(iii)        whether
the resulting Borrowing is to be a Base Rate Borrowing or a Eurodollar Borrowing; and

 

(iv)        if
the resulting Borrowing is a Eurodollar Borrowing, the Interest Period to be applicable thereto after giving effect to such election,
which shall be a period contemplated by the definition of the term “Interest Period.”

 

If any such Interest Election Request requests a Eurodollar
Borrowing but does not specify an Interest Period, then the Borrower shall be deemed to have selected an Interest Period of one
month’s duration.

 

(d)          Promptly
following receipt of an Interest Election Request, the Administrative Agent shall advise each Lender of the details thereof and
of such Lender’s portion of each resulting Borrowing.

 

(e)          If
the Borrower fails to deliver a timely Interest Election Request with respect to a Eurodollar Borrowing prior to the end of the
Interest Period applicable thereto, then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period
such Borrowing shall be converted to a Base Rate Borrowing. Notwithstanding any contrary provision hereof, if an Event of Default
has occurred and is continuing and the Administrative Agent, at the request of the Majority Lenders, so notifies the Borrower,
then, so long as an Event of Default is continuing (i) no outstanding Borrowing may be converted to or continued as a Eurodollar
Borrowing and (ii) unless repaid, each Eurodollar Borrowing shall become a Base Rate Borrowing at the end of the Interest Period
applicable thereto.

 

Section 2.8           Termination
and Reduction of Aggregate Maximum Credit Amounts.

 

(a)          Scheduled
Termination of Commitments. Unless previously terminated, the Commitments shall terminate on the Maturity Date. If at any time
the Aggregate Maximum Credit Amounts or the Borrowing Base is terminated or reduced to zero, then the Commitments shall terminate
on the effective date of such termination or reduction. Notwithstanding anything in the Loan Documents to the contrary, the Commitments
shall terminate on the date (if earlier than August 27, 2019) that is six months prior to the stated maturity date of the Permitted
Secured Debt (or any Permitted Refinancing Debt).

 

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(b)          Optional
Termination and Reduction of Aggregate Credit Amounts. The Borrower may at any time terminate, or from time to time reduce,
the Aggregate Maximum Credit Amounts; provided that (i) each reduction of the Aggregate Maximum Credit Amounts shall be
in an amount that is an integral multiple of $1,000,000 and not less than $5,000,000 and (ii) the Borrower shall not terminate
or reduce the Aggregate Maximum Credit Amounts if, after giving effect to any concurrent prepayment of the Loans in accordance
with Section 2.10(c), the total Credit Exposures would exceed the total Commitments.

 

(c)          Notice
of Optional Termination or Reduction. The Borrower shall notify the Administrative Agent of any election to reduce or terminate
the Aggregate Maximum Credit Amounts under clause (b) of this Section at least three Business Days prior to the effective
date of such reduction or termination, specifying such election and the effective date thereof. Promptly following receipt of any
notice, the Administrative Agent shall advise the Lenders of the contents thereof. Each notice delivered by the Borrower pursuant
to this Section shall be irrevocable; provided that a notice of termination of the Aggregate Maximum Credit Amounts delivered
by the Borrower may state that such notice is conditioned upon the effectiveness of other credit facilities, in which case such
notice may be revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified effective date) if such
condition is not satisfied. Any reduction or termination of the Aggregate Maximum Credit Amounts shall be permanent.

 

(d)          Ratable
Reduction. Each reduction in the Aggregate Maximum Credit Amounts shall be made ratably among the Lenders in accordance with
their respective applicable Aggregate Maximum Credit Amounts.

 

Section 2.9           Repayment of
Loans; Evidence of Debt. (a) The Borrower hereby unconditionally promises to pay to the Administrative Agent for the account
of each Lender the then-unpaid principal amount of each Loan on the Maturity Date.

 

(b)          Each
Lender shall maintain, in accordance with its usual practice, an account or accounts evidencing the indebtedness of the Borrower
to such Lender resulting from each Loan made by such Lender, including the amounts of principal and interest payable and paid to
such Lender from time to time hereunder.

 

(c)          The
Administrative Agent shall maintain a Register pursuant to Section 9.4(c) and an account for each Lender in which it
shall record (i) the amount of each Loan made hereunder and any promissory note evidencing such Loan, the Type thereof and
the Interest Period, if any, applicable thereto, (ii) the amount of any principal or interest due and payable or to become
due and payable from the Borrower to each Lender hereunder and (iii) the amount of any sum received by the Administrative
Agent hereunder for the account of the Lenders and each Lender’s share thereof.

 

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(d)          The
entries made in the Register and the accounts maintained pursuant to clause (b) or (c) of this Section
shall be prima facie evidence of the existence and amounts of the Obligations recorded therein; provided that
the failure of any Lender or the Administrative Agent to maintain such accounts or any error therein shall not in any manner affect
the obligation of the Borrower to repay the Obligations in accordance with the terms of this Agreement.

 

(e)          Any
Lender may request that Loans made by it be evidenced by a promissory note (each, a “Revolving Note”) in the
form of Exhibit A. In such event, the Borrower shall prepare, execute and deliver to such Lender a Revolving Note payable
to the Lender and its registered assigns. Thereafter, the Loans evidenced by such Revolving Note and interest thereon shall at
all times (including after assignment pursuant to Section 9.4) be represented by one or more Revolving Notes payable
to the payee named therein and its registered assigns.

 

Section 2.10         Prepayment
of Loans.

 

(a)          Optional
Prepayments. The Borrower shall have the right at any time and from time to time to prepay any Borrowing in whole or in part,
subject to prior notice in accordance with Section 2.10(b).

 

(b)          Notice
and Terms of Optional Prepayment. The Borrower shall notify the Administrative Agent by telephone (confirmed by telecopy or,
if arrangements for doing so have been approved by the Administrative Agent, electronic communication) of any prepayment hereunder
(i) in the case of prepayment of a Eurodollar Borrowing, not later than 11:00 a.m. three Business Days but no more than five Business
Days before the date of prepayment, or (ii) in the case of prepayment of a Base Rate Borrowing, not later than 11:00 a.m. one Business
Day before the date of prepayment; provided that, if a notice of prepayment is given in connection with a conditional notice
of termination or reduction of the Aggregate Maximum Credit Amounts as contemplated by Section 2.8, then such notice
of prepayment may be revoked if such notice of termination or reduction is revoked in accordance with Section 2.8.
Promptly following receipt of any such notice relating to a Borrowing, the Administrative Agent shall advise the Lenders of the
contents thereof. Each partial prepayment of any Borrowing under Section 2.10(a) shall be in an aggregate minimum amount
of $1,000,000 and an integral multiple of $1,000,000. Prepayments shall be accompanied by accrued interest to the extent required
by Section 2.12. If a Eurodollar Loan is prepaid on any day other than the last day of the Interest Period applicable
thereto, the Borrower shall also pay any amounts owing pursuant to Section 2.16.

 

(c)          Mandatory
Prepayments.

 

(i)          If,
after giving effect to any termination or reduction of the Aggregate Maximum Credit Amounts pursuant to Section 2.8,
the total Credit Exposures exceeds the total Commitments, then the Borrower shall (A) prepay the Borrowings on the date of such
termination or reduction in an aggregate principal amount equal to such excess, and (B) if any excess remains after prepaying all
of the Borrowings as a result of an LC Exposure, pay to the Administrative Agent on behalf of the Lenders an amount equal to such
excess to be held as Cash Collateral as provided in Section 2.5(j).

 

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(ii)         Upon
any redetermination of or adjustment to the amount of the Borrowing Base in accordance with Section 2.4(b) or 2.4(g)
at any time, if the total Credit Exposures exceeds the redetermined or adjusted Borrowing Base, then within ten Business Days of
receipt of notice from the Administrative Agent that a Borrowing Base deficiency then exists, then Borrower must (A) notify the
Administrative Agent that it shall make a mandatory prepayment equal to the amount of the Borrowing Base deficiency within 30 days
from and after receipt by the Borrower of notice of the Borrowing Base deficiency or elect to make payments at least equal to the
Required Deficiency Payment on each Borrowing Base Deficiency Payment Date, (B) notify the Administrative Agent that it shall execute
and deliver, or cause one or more Subsidiaries to execute and deliver, to the Administrative Agent within 30 days from and after
receipt by the Borrower of notice of the Borrowing Base deficiency, supplemental or additional Security Documents, in form and
substance reasonably satisfactory to the Administrative Agent securing payment of the Obligations and covering other Properties
of the Borrower or such Restricted Subsidiaries, as applicable, including additional Oil and Gas Properties directly owned by the
Borrower or such Restricted Subsidiaries that are not then covered by any Security Document and that are of a type and nature satisfactory
to the Administrative Agent, and having a value (as determined by the Administrative Agent and the Lenders in their sole discretion),
in addition to other Oil and Gas Properties already subject to a Mortgage, in an amount at least equal to the Borrowing Base deficiency;
provided, that if the Borrower shall elect to execute and deliver (or cause one or more Restricted Subsidiaries to execute
and deliver) supplemental or additional Security Documents to the Administrative Agent pursuant to subclause (B) of this Section 2.10(c)(ii),
it shall provide concurrently within such 30 day period to the Administrative Agent descriptions of the additional assets to be
mortgaged or pledged thereby (together with current valuations, engineering reports, title evidence or opinions applicable thereto
and other documents (including opinions of counsel) reasonably requested by the Administrative Agent, each of which shall be in
form and substance reasonably satisfactory to the Administrative Agent) or (C) notify the Administrative Agent that the Borrower
will implement a combination of the actions described in the foregoing subclauses (A) and (B) that are acceptable to the Administrative
Agent (and thereafter implement such actions in accordance with subclauses (A) and (B)); and further provided
that if the Administrative Agent has not received within such ten Business Day period the required notice from the Borrower that
the Borrower shall take the actions described in subclause (B) within such 30 day period, then without any necessity
for notice to the Borrower or any other Person, the Borrower shall be deemed to have elected to make mandatory prepayments equal
to at least the Required Deficiency Payment for each Borrowing Base Deficiency Payment Date. Notwithstanding the foregoing, all
payments required to be made pursuant to this Section 2.10(c)(ii) must be made on or prior to the Termination Date.

 

(iii)        Upon
any adjustments to the Borrowing Base pursuant to Section 2.4(f) or (h), if the total Credit Exposures exceeds
the Borrowing Base as adjusted, then the Borrower shall (A) prepay the Borrowings in an aggregate principal amount equal to such
excess, and (B) if any excess remains after prepaying all of the Borrowings as a result of an LC Exposure, pay to the Administrative
Agent on behalf of the Lenders an amount equal to such excess to be held as Cash Collateral as provided in Section 2.5(j).
In the case of Section 2.4(f) or (h), the Borrower shall be obligated to make such prepayment and/or deposit
of Cash Collateral on the date it receives cash proceeds as a result of such Disposition or Hedge Liquidation; provided
that all payments required to be made pursuant to this Section 2.10(c)(iii) must be made on or prior to the Termination
Date.

 

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(iv)        Upon
the Disposition of any Oil and Gas Property or any interest therein or any Subsidiary owning Oil and Gas Properties pursuant to
Section 6.5(d), which Disposition does not result in the total Credit Exposures exceeding the Borrowing Base, as the
same may be adjusted pursuant to Section 6.5(d) upon any such sale or other Disposition, then the Borrower shall prepay
the Borrowings (and if any excess remains after prepaying Borrowings as a result of an LC Exposure, Cash Collateralize such excess
as provided in Section 2.5(j), together with accrued and unpaid interest thereon, in an amount equal to 100% of the
Net Cash Proceeds (which Net Cash Proceeds, for the avoidance of doubt, shall not be calculated giving effect to the payment of
any Indebtedness) received from such Disposition. Such payment shall be due on the earlier to occur of (A) one Business Day prior
to any date on which the Borrower or any Subsidiary would be required to make a mandatory prepayment of Permitted Secured Debt
(or Permitted Refinancing Debt, as the case may be) with the Net Cash Proceeds from such Disposition and (B) the Termination Date,
provided that such payment shall be reduced by the amount of such Net Cash Proceeds reinvested by the Borrower and its Restricted
Subsidiaries, during the period from the date of such Disposition to the due date of such prepayment, in Property (other than inventory
and working capital or Investments permitted by Section 6.6(k)) used or to be used in the businesses permitted pursuant
to Section 6.10.

 

Section 2.11         Fees.
(a) The Borrower agrees to pay to the Administrative Agent for the account of each Lender a commitment fee, which shall accrue
at the Commitment Fee Rate on the daily amount of the unused Commitment of such Lender during the period from and including the
Effective Date to but excluding the date on which such Commitment terminates. Accrued commitment fees shall be payable in arrears
on the last day of March, June, September and December of each year and on the date on which the Commitments terminate, commencing
on the first such date to occur after the date hereof.

 

(b)          The
Borrower agrees to pay (i) to the Administrative Agent for the account of each Lender a participation fee with respect to its participations
in Letters of Credit, which shall accrue at the same Applicable Margin used to determine the interest rate applicable to Eurodollar
Loans on the average daily amount of such Lender’s LC Exposure (excluding any portion thereof attributable to unreimbursed
LC Disbursements) during the period from and including the Effective Date to but excluding the later of the date on which such
Lender’s Commitment terminates and the date on which such Lender ceases to have any LC Exposure (provided that this
clause (i) is subject to Section 2.12(c)) and (ii) to each applicable Issuing Bank a fronting fee, which
shall be equal to the greater of $500 or the rate of 0.25% per annum on the average daily amount of the LC Exposure (excluding
any portion thereof attributable to unreimbursed LC Disbursements) allocable to Letters of Credit issued by such Issuing Bank during
the period from and including the Effective Date to but excluding the later of the date of termination of the Commitments and the
date on which there ceases to be any LC Exposure, as well as the applicable Issuing Bank’s standard fees with respect to
the issuance, amendment or extension of any Letter of Credit or processing of drawings thereunder. Participation fees and fronting
fees accrued through and including the last day of March, June, September and December of each year shall be payable on the third
Business Day following such last day, commencing on the first such date to occur after the Effective Date; provided that
all such fees shall be payable on the date on which the Commitments terminate, and any such fees accruing after the date on which
the Commitments terminate shall be payable on demand. Any other fees payable to the Issuing Banks pursuant to this Section 2.11(b)
shall be payable within ten days after demand.

 

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(c)          The
Borrower agrees to pay fees payable in the amounts and at the times set forth in the Fee Letter.

 

(d)          All
fees payable under this Section shall be computed on the basis of a year of 360 days and shall be payable for the actual number
of days elapsed (including the first day but excluding the last day). Each determination by the Administrative Agent of a fee hereunder
shall be conclusive absent manifest error.

 

(e)          All
fees payable hereunder shall be paid on the dates due, in immediately available funds, to the Administrative Agent (or to the applicable
Issuing Bank, in the case of fees payable to it) for distribution, in the case of commitment fees and participation fees, to the
Lenders. Fees, once paid, shall be fully earned and shall not be refundable under any circumstances.

 

Section 2.12         Interest.
(a) The Loans comprising each Base Rate Borrowing shall bear interest at the Alternate Base Rate plus the Applicable Margin.

 

(b)          The
Loans comprising each Eurodollar Borrowing shall bear interest at the Adjusted LIBO Rate for the Interest Period in effect for
such Borrowing plus the Applicable Margin.

 

(c)          After
the date (after giving effect to any grace period) any principal amount of any Loan is due and payable (whether on the stated Maturity
Date, upon acceleration or otherwise), or after any other monetary Obligation of the Borrower shall have become due and payable,
the Borrower shall pay, but only to the extent permitted by (or not prohibited by or in contravention of) law, interest (after
as well as before judgment) with respect to such overdue amounts at a rate (the “Default Rate”) per annum equal
to either (A) if an interest rate is applicable to such overdue amount on the day on which such amount was due, then the sum of
(x) 2.00% plus (y) the Applicable Margin effect on such date or (B) if no interest rate applies to the sum on the date that such
amount becomes due or the amount overdue is a Loan or portion thereof, then the sum of (x) the Base Rate plus (y) 2.00% plus (z)
the Applicable Margin from time to time in effect for Base Rate Loans. During any Borrowing Base deficiency, beginning on (and
including) the Borrowing Base Determination Date and ending on (but excluding) the Final Borrowing Base Deficiency Payment Date,
all interest shall accrue at the Default Rate.

 

(d)          Accrued
interest on each Loan shall be payable in arrears on each Interest Payment Date for such Loan upon termination of the Commitments;
provided that (i) interest accrued pursuant to clause (c) of this Section shall be payable on demand, (ii) in
the event of any repayment or prepayment of any Loan (other than a prepayment of a Base Rate Loan prior to the end of the Availability
Period), accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment
and (iii) in the event of any conversion of any Eurodollar Loan prior to the end of the current Interest Period therefor, accrued
interest on such Loan shall be payable on the effective date of such conversion.

 

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(e)          All
interest hereunder shall be computed on the basis of a year of 360 days, except that interest computed by reference to the Alternate
Base Rate at times when the Alternate Base Rate is based on the base rate shall be computed on the basis of a year of 365 days
(or 366 days in a leap year) and, in each case, shall be payable for the actual number of days elapsed (including the first day
but excluding the last day). The applicable Alternate Base Rate or LIBO Rate shall be determined by the Administrative Agent, and
such determination shall be conclusive absent manifest error.

 

Section 2.13         Alternate
Rate of Interest. Notwithstanding any other provision of this Agreement, if prior to the commencement of any Interest Period
for a Eurodollar Borrowing:

 

(a)          the
Administrative Agent determines (which determination shall be conclusive absent manifest error) that adequate and reasonable means
do not exist for ascertaining the LIBO Rate for an Interest Period with the duration of such Interest Period; or

 

(b)          the
Administrative Agent is advised by the Majority Lenders that the Adjusted LIBO Rate for such Interest Period will not adequately
and fairly reflect the cost to such Lenders of making or maintaining their Loans included in such Borrowing for an Interest Period
with the duration of such Interest Period;

 

then the Administrative Agent shall give notice thereof to the
Borrower and the Lenders by telephone, telecopy or (if arrangements for doing so have been approved by the Administrative Agent,
by electronic communication) as promptly as practicable thereafter and, until the Administrative Agent notifies the Borrower and
the Lenders that the circumstances giving rise to such notice no longer exist, then (i) any Interest Election Request that requests
the conversion of any Borrowing to, or continuation of any Borrowing as, a Eurodollar Borrowing with an Interest Period having
the duration of such Interest Period shall be ineffective and (ii) if any Borrowing Request requests a Eurodollar Borrowing with
an Interest Period having the duration of such Interest Period, such Borrowing shall be made as a Base Rate Borrowing.

 

Section 2.14         Increased
Costs.

 

(a)          Increased
Costs Generally. If any Change in Law shall:

 

(i)          impose,
modify or deem applicable any reserve, special deposit, liquidity, compulsory loan, insurance charge or similar requirement against
assets of, deposits with or for the account of, or credit extended or participated in by, any Lender (except any such reserve request
reflected in the Adjusted LIBO Rate) or any Issuing Bank;

 

(ii)         subject
any Recipient to any Taxes (except to the extent such Taxes are Indemnified Taxes, Taxes described in clauses (b) through
(d) of the definition of “Excluded Taxes” or Other Connection Taxes) on its loans, loan principal, letters
of credit, commitments or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto; or

 

(iii)        impose
on any Lender or any Issuing Bank or the London interbank market any other condition, cost or expense (other than Taxes) affecting
this Agreement or Loans made by such Lender or any Letter of Credit or participation therein;

 

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and the result of any of the foregoing shall be to increase
the cost to such Lender or such other Recipient of making, converting to, continuing or maintaining any Eurodollar Loan (or, in
the case of any Change in Law with respect to Taxes, any Loan) or of maintaining its obligation to make any such Loan, or to increase
the cost to such Lender, such Issuing Bank or such other Recipient of participating in, issuing or maintaining any Letter of Credit
(or of maintaining its obligation to participate in or to issue any Letter of Credit), or to reduce the amount of any sum received
or receivable by such Lender, Issuing Bank or other Recipient hereunder (whether of principal, interest or any other amount, then,
upon request of such Lender, Issuing Bank or other Recipient, the Borrower will pay to such Lender, Issuing Bank or other Recipient,
as the case may be, such additional amount or amounts as will compensate such Lender, Issuing Bank or other Recipient, as the case
may be, for such additional costs incurred or reduction suffered.

 

(b)          Capital
Requirements. If any Lender or Issuing Bank determines that any Change in Law affecting such Lender or Issuing Bank or any
lending office of such Lender or such Lender’s or Issuing Bank’s holding company, if any, regarding capital or liquidity
requirements, has or would have the effect of reducing the rate of return on such Lender’s or Issuing Bank’s capital
or on the capital of such Lender’s or Issuing Bank’s holding company, if any, as a consequence of this Agreement, the
Commitments of such Lender or the Loans made by, or participations in Letters of Credit, such Lender, or the Letters of Credit
issued by any Issuing Bank, to a level below that which such Lender or Issuing Bank or such Lender’s or Issuing Bank’s
holding company could have achieved but for such Change in Law (taking into consideration such Lender’s or Issuing Bank’s
policies and the policies of such Lender’s or Issuing Bank’s holding company with respect to capital adequacy and liquidity),
then from time to time the Borrower will pay to such Lender or Issuing Bank, as the case may be, such additional amount or amounts
as will compensate such Lender or Issuing Bank or such Lender’s or Issuing Bank’s holding company for any such reduction
suffered.

 

(c)          Certificates
for Reimbursement. A certificate of a Lender, Issuing Bank or other Recipient setting forth the amount or amounts necessary
to compensate such Lender, Issuing Bank or other Recipient or its holding company, as the case may be, as specified in clause (a)
or (b) of this Section shall be delivered to the Borrower and shall be conclusive manifest error. The Borrower shall pay
such Lender, Issuing Bank or other Recipient, as the case may be, the amount properly shown as due on any such certificate within
ten days after receipt thereof, absent manifest error.

 

(d)          Delay
in Requests. Failure or delay on the part of any Lender, Issuing Bank or other Recipient to demand compensation pursuant to
this Section shall not constitute a waiver of such Lender’s, Issuing Bank’s or other Recipient’s right to demand
such compensation; provided that the Borrower shall not be required to compensate a Lender, Issuing Bank or other Recipient
pursuant to this Section for any increased costs incurred or reductions suffered more than nine months prior to the date that such
Lender, Issuing Bank or other Recipient, as the case may be, notifies the Borrower of the Change in Law giving rise to such increased
costs or reductions, and of such Lender’s, Issuing Bank’s or other Recipient’s intention to claim compensation
therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the nine-month
period referred to above shall be extended to include the period of retroactive effect thereof).

 

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(e)          Eurocurrency
Liabilities. The Borrower shall pay to each Lender, as long as such Lender shall be required to maintain reserves with respect
to liabilities or assets consisting of or including Eurocurrency funds or deposits (currently known as “Eurocurrency liabilities”),
additional interest on the unpaid principal amount of each Eurodollar Loan equal to the actual costs of such reserves allocated
to such Loan by such Lender (as determined by such Lender in good faith, which determination shall be conclusive), which shall
be due and payable on each date on which interest is payable on such Loan; provided the Borrower shall have received at
least ten days’ prior notice (with a copy to the Administrative Agent) of such additional interest from such Lender. If a
Lender fails to give notice ten days prior to the relevant Interest Payment Date, such additional interest shall be due and payable
ten days from receipt of such notice.

 

Section 2.15         Change
in Legality. Notwithstanding any other provision of this Agreement, if any Change in Law shall make it unlawful for any Lender
to make or maintain, or convert any Loan into, a Eurodollar Loan, then, upon written notice by such Lender to the Borrower and
to the Administrative Agent, which notice shall specify the extent of such unlawfulness (e.g., whether such unlawfulness applies
to Eurodollar Loans generally or only to Interest Periods of a particular length):

 

(a)          any
request for the making or continuation of, or the conversion of Base Rate Loans into, Eurodollar Loans shall, solely as to such
Lender and to the extent a Eurodollar Loan by such Lender would be (or during the applicable Interest Period would become) unlawful,
be disregarded and the Loan of such Lender that would be part of the applicable Borrowing of Eurodollar Loans shall be made as,
converted to or continue to be maintained as a Base Rate Loan (or bear interest at such other rate as may be agreed between the
Borrower and such Lender); and

 

(b)          each
outstanding Eurodollar Loan of such Lender shall, on the last day of the Interest Period therefor (unless such Loan may be continued
as a Eurodollar Loan for the full duration of any requested new Interest Period without being unlawful) or on such earlier date
as such Lender shall specify is necessary pursuant to the applicable Change in Law, convert to a Base Rate Loan.

 

Section 2.16         Break
Funding Payments. In the event of (a) the payment of any principal of any Eurodollar Loan other than on the last day of an
Interest Period applicable thereto (including as a result of an Event of Default), (b) the conversion of any Eurodollar Loan other
than on the last day of the Interest Period applicable thereto, (c) the failure to borrow, convert, continue or prepay any Eurodollar
Loan on the date specified in any notice delivered pursuant hereto (regardless of whether such notice may be revoked under Section 2.8(c)
and is revoked in accordance therewith) or (d) the assignment of any Eurodollar Loan other than on the last day of the Interest
Period applicable thereto as a result of a request by the Borrower pursuant to Section 2.19, then, in any such event,
the Borrower shall compensate each Lender for the loss, cost and expense attributable to such event. In the case of a Eurodollar
Loan, such loss, cost or expense to any Lender shall be deemed to include an amount determined by such Lender to be the excess,
if any, of (i) the amount of interest that would have accrued on the principal amount of such Loan had such event not occurred,
at the Adjusted LIBO Rate that would have been applicable to such Loan, for the period from the date of such event to the last
day of the then-current Interest Period therefor (or, in the case of a failure to borrow, convert or continue, for the period that
would have been the Interest Period for such Loan) over (ii) the amount of interest that would accrue on such principal amount
for such period at the interest rate that such Lender would bid were it to bid, at the commencement of such period, for Dollar
deposits of a comparable amount and period from other banks in the eurodollar market. A certificate of any Lender setting forth
any amount or amounts that such Lender is entitled to receive pursuant to this Section shall be delivered to the Borrower and shall
be conclusive manifest error. The Borrower shall pay such Lender the amount shown as due on any such certificate within ten days
after receipt thereof, absent manifest error.

 

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Section 2.17         Taxes.

 

(a)          Issuing
Bank; FATCA. For purposes of this Section 2.17, the term “Lender” includes any Issuing Bank
and the term “Applicable Law” includes FATCA.

 

(b)          Payments
Free of Taxes. Any and all payments by or on account of any obligation of the Borrower under any Loan Document shall be made
without deduction or withholding for any Taxes, except as required by Applicable Law. If any Applicable Law (as determined in the
good faith discretion of an applicable Withholding Agent) requires the deduction or withholding of any Tax from any such payment
by a Withholding Agent, then the applicable Withholding Agent shall be entitled to make such deduction or withholding and shall
timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with Applicable Law, and,
if such Tax is an Indemnified Tax, then the sum payable by the Borrower shall be increased as necessary so that after such deduction
or withholding has been made (including such deductions and withholdings of Indemnified Taxes applicable to additional sums payable
under this Section), the applicable Recipient receives an amount equal to the sum it would have received had no such deduction
or withholding been made.

 

(c)          Payment
of Other Taxes by the Borrower. The Borrower shall timely pay to the relevant Governmental Authority in accordance with Applicable
Law, or, at the option of the Administrative Agent, timely reimburse it for the payment of, any Other Taxes.

 

(d)          Indemnification
by the Borrower. The Borrower hereby indemnifies each Recipient, within ten days after demand therefor, for the full amount
of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section)
payable or paid by such Recipient or required to be withheld or deducted from a payment to such Recipient and any reasonable expenses
arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted
by the relevant Governmental Authority; provided, however, the Borrower shall not be required to indemnify a Recipient
pursuant to this Section 2.17(d) for any Indemnified Taxes unless such Recipient makes written demand on the Borrower for
indemnification no later than nine months after the earlier of (i) the date on which the relevant Governmental Authority makes
written demand upon such Recipient for payment of such Indemnified Taxes and (ii) the date on which such Recipient has made payment
of such Indemnified Taxes (Except that, if the Indemnified Taxes imposed or asserted giving rise to such claims are retroactive,
then the nine-month period referred to above shall be extended to include the period of retroactive effect thereof). A certificate
as to the amount of such payment or liability shall be delivered to the Borrower by a Lender (with a copy to the Administrative
Agent), or by the Administrative Agent on its own behalf or on behalf of a Lender, and shall be conclusive absent manifest error.

 

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(e)          Indemnification
by the Lenders. Each Lender shall severally indemnify the Administrative Agent, within ten days after demand therefor, for
(i) any Indemnified Taxes attributable to such Lender (but only to the extent that the Loan Parties have not already indemnified
the Administrative Agent for such Indemnified Taxes and without limiting the obligation of the Loan Parties to do so), (ii) any
Taxes attributable to such Lender’s failure to comply with the provisions of Section 9.4(d) relating to the maintenance
of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by the
Administrative Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto,
whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as
to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest
error. Each Lender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such
Lender under any Loan Document or otherwise payable by the Administrative Agent to the Lender from any other source against any
amount due to the Administrative Agent under this clause (e).

 

(f)          Evidence
of Payments. As soon as practicable after any payment of Taxes by the Borrower to a Governmental Authority pursuant to this
Section 2.17, the Borrower shall deliver to the Administrative Agent the original or a certified copy of a receipt
issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of
such payment reasonably satisfactory to the Administrative Agent.

 

(g)          Status
of Lenders. (i) Any Lender that is entitled to an exemption from or reduction of withholding Tax with respect to payments made
under any Loan Document shall deliver to the Borrower and the Administrative Agent, at the time or times reasonably requested by
the Borrower or the Administrative Agent, such properly completed and executed documentation reasonably requested by the Borrower
or the Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In
addition, any Lender, if reasonably requested by the Borrower or the Administrative Agent, shall deliver such other documentation
prescribed by Applicable Law or reasonably requested by the Borrower or the Administrative Agent as will enable the Borrower or
the Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements.
Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation
(other than such documentation set forth in Sections 2.17(g)(ii)(1) and (ii)(2) and 2.17(h) below) shall
not be required if, in the Lender’s reasonable judgment, such completion, execution or submission would subject such Lender
to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.

 

(ii)         Without
limiting the generality of the foregoing, in the event that the Borrower is a U.S. Person,

 

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(1)         any
Lender that is a U.S. Person shall deliver to the Borrower and the Administrative Agent on or prior to the date on which such Lender
becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative
Agent), executed originals of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding tax;

 

(2)         any
Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such
number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender
under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent),
whichever of the following is applicable:

 

(A)         in
the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party, (x) with respect
to payments of interest under any Loan Document, executed originals of IRS Form W-8BEN establishing an exemption from, or reduction
of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any
other applicable payments under any Loan Document, IRS Form W-8BEN establishing an exemption from, or reduction of, U.S. federal
withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;

 

(B)         executed
originals of IRS Form W-8ECI;

 

(C)         in
the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the IRC,
(x) a certificate substantially in the form of Exhibit G-1 to the effect that such Foreign Lender is not a “bank”
within the meaning of Section 881(c)(3)(A) of the IRC, a “10 percent shareholder” of the Borrower within the meaning
of Section 881(c)(3)(B) of the IRC, or a “controlled foreign corporation” described in Section 881(c)(3)(C) of the
IRC (a “U.S. Tax Compliance Certificate”) and (y) executed originals of IRS Form W-8BEN; or

 

(D)         to
the extent a Foreign Lender is not the beneficial owner, executed originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI,
IRS Form W-8BEN, a U.S. Tax Compliance Certificate substantially in the form of Exhibit G-2 or Exhibit G-3,
IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that, if the Foreign
Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest
exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate substantially in the form of Exhibit G-4
on behalf of each such direct and indirect partner; and

 

(3)         any
Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such
number of copies as shall be requested by the recipient), on or prior to the date on which such Foreign Lender becomes a Lender
under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent),
executed originals of any other form prescribed by Applicable Law as a basis for claiming exemption from or a reduction in U.S.
federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by Applicable Law
to permit the Borrower or the Administrative Agent to determine the withholding or deduction required to be made.

 

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(h)          Documentation
Required by FATCA. If a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed
by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in
Section 1471(b) or 1472(b) of the IRC, as applicable), such Lender shall deliver to the Borrower and the Administrative Agent at
the time or times prescribed by law and at such time or times reasonably requested by the Borrower or the Administrative Agent
such documentation prescribed by Applicable Law (including as prescribed by Section 1471(b)(3)(C)(i) of the IRC) and such additional
documentation reasonably requested by the Borrower or the Administrative Agent as may be necessary for the Borrower and the Administrative
Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations
under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (h),
the term “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

 

(i)          Treatment
of Certain Refunds. Unless required by Applicable Law, at no time shall the Administrative Agent have any obligation to file
for or otherwise pursue on behalf of any Recipient, or have any obligation to pay to any Recipient, any refund of Taxes withheld
or deducted from funds paid for the account of such Recipient, as the case may be. If any Recipient determines, in its sole discretion
exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 2.17
(including by the payment of additional amounts pursuant to this Section 2.17), it shall pay to the indemnifying party
an amount equal to such refund (but only to the extent of indemnity payments made under this Section with respect to the Taxes
giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest
(other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon
the request of such Recipient, shall repay to such Recipient the amount paid over pursuant to this clause (i) (plus
any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such Recipient is required
to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this clause (i), in
no event will a Recipient be required to pay any amount to an indemnifying party pursuant to this clause (i) the payment
of which would place such Recipient in a less favorable net after-Tax position than such Recipient would have been in if the Tax
subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification
payments or additional amounts with respect to such Tax had never been paid. This clause (i) shall not be construed
to require any Recipient to make available its Tax returns (or any other information relating to its Taxes that it deems confidential)
to the indemnifying party or any other Person.

 

(j)          Survival.
Each party’s obligations under this Section 2.17 shall survive the resignation or replacement of the Administrative
Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction
or discharge of all other Obligations.

 

(k)          Updates.
Each Lender agrees that if any form or certification it previously delivered pursuant to this Section 2.17 expires
or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Borrower and
the Administrative Agent in writing of its legal inability to do so.

 

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Section 2.18         Payments
Generally. The Borrower shall make each payment required to be made by it hereunder (whether of principal, interest, fees or
reimbursement of LC Disbursements, or of amounts payable under Section 2.14, 2.16 or 2.17, or otherwise)
prior to 12:00 noon on the date when due, in immediately available funds, without defense, deduction, recoupment, set-off or counterclaim.
Any amounts received after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received
on the next succeeding Business Day for purposes of calculating interest thereon and fees with respect thereto. All such payments
shall be made to the Administrative Agent to such account as the Administrative Agent shall specify from time to time by notice
to the Borrower except payments to be made directly to any Issuing Bank as expressly provided herein and except that payments pursuant
to Sections 2.14, 2.16, 2.17 and 9.3 shall be made directly to the Persons entitled thereto. The
Administrative Agent shall distribute any such payments received by it for the account of any other Person to the appropriate recipient
promptly following receipt thereof. If any payment hereunder shall be due on a day that is not a Business Day, the date for payment
shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall
be payable for the period of such extension. All payments hereunder shall be made in Dollars.

 

Section 2.19         Pro
Rata Treatment; Sharing of Set-offs.

 

(a)          If,
at any time, insufficient funds are received by and available to the Administrative Agent to pay fully all amounts of principal,
unreimbursed LC Disbursements, interest and fees then due hereunder, such funds shall be applied (i) first, towards payment
of interest and fees then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest
and fees then due to such parties and (ii) second, towards payment of principal and unreimbursed LC Disbursements then due
hereunder, ratably among the parties entitled thereto in accordance with the amounts of principal and unreimbursed LC Disbursements
then due to such parties.

 

(b)          If
any Lender shall, by exercising any right of setoff or counterclaim or otherwise, obtain payment in respect of any principal of
or interest on any of its Loans or other obligations hereunder resulting in such Lender receiving payment of a proportion of the
aggregate amount of its Loans and accrued interest thereon or other such obligations greater than its pro rata share
thereof as provided herein, then the Lender receiving such greater proportion shall (i) notify the Administrative Agent of such
fact and (ii) purchase (for cash at face value) participations in the Loans and such other obligations of the other Lenders, or
make such other adjustments as shall be equitable, so that the benefit of all such payments shall be shared by the Lenders ratably
in accordance with the aggregate amount of principal of and accrued interest on their respective Loans and other amounts owing
them; provided that:

 

(x)          
if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations
shall be rescinded and the purchase price restored to the extent of such recovery, without interest; and

 

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(y)          the
provisions of this Section 2.19(b) shall not be construed to apply to (A) any payment made by the Borrower pursuant
to and in accordance with the express terms of this Agreement (including the application of funds arising from the existence of
a Defaulting Lender), (B) the application of Cash Collateral provided for in Section 2.21 or (C) any payment obtained
by a Lender as consideration for the assignment of or sale of a participation in any of its Loans or participations in LC Disbursements
to any assignee or participant, other than to the Borrower or any Subsidiary or Affiliate thereof (as to which the provisions of
this Section 2.19(b) shall apply).

 

The Borrower consents to the foregoing and agrees, to the extent
it may effectively do so under Applicable Law, that any Lender acquiring a participation pursuant to the foregoing arrangements
may exercise against the Borrower rights of setoff and counterclaim with respect to such participation as fully as if such Lender
were a direct creditor of the Borrower in the amount of such participation.

 

(c)          Unless
the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative
Agent for the account of the Lenders or the Issuing Banks hereunder that the Borrower will not make such payment, the Administrative
Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption,
distribute to the Lenders or the Issuing Banks, as the case may be, the amount due. In such event, if the Borrower has not in fact
made such payment, then each of the Lenders or the Issuing Banks, as the case may be, severally agrees to repay to the Administrative
Agent forthwith on demand the amount so distributed to such Lender or Issuing Bank, with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the greater
of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules
on interbank compensation.

 

(d)          The
obligations of the Lenders hereunder to make Loans, to fund participations in Letters of Credit and to make payments pursuant to
Section 9.3(c) are several and not joint. The failure of any Lender to make any Loan, to fund any such participation
or to make any payment under Section 9.3(c) on any date required hereunder shall not relieve any other Lender of its
corresponding obligation to do so on such date, and no Lender shall be responsible for the failure of any other Lender to so make
its Loan, to purchase its participation or to make its payment under Section 9.3(c).

 

Section 2.20         Mitigation
Obligations; Replacement of Lenders.

 

(a)          Designation
of a Different Lending Office. If any Lender requests compensation under Section 2.14, or delivers a notice described
in Section 2.15, or requires the Borrower to pay any Indemnified Tax or additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.17, then such Lender shall (at the request of the Borrower)
use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights
and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender, such designation
or assignment (i) would eliminate or reduce any amount payable pursuant to Section 2.14 or 2.17, or illegality,
as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise
be disadvantageous to such Lender. The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.

 

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(b)          Replacement
of Lenders. If any Lender requests compensation under Section 2.14, or if any Lender delivers a notice described
in Section 2.15 or if the Borrower is required to pay any Indemnified Tax or additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.17, and, in each case, such Lender has declined
or is unable to designate a different lending office in accordance with Section 2.20(a) (each such Lender, an “Increased
Cost Lender”), or if any Lender is a Defaulting Lender or a Non-Consenting Lender, or any Lender has not approved (or
is not deemed to have approved) an increase in the Borrowing Base proposed by the Administrative Agent pursuant to Section 2.4(c)(iii),
then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender
to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in, and consents required
by, Section 9.4), all of its interests, rights (other than its existing rights to payments pursuant to Section 2.14
or Section 2.17) and obligations under this Agreement and the related Loan Documents to an Eligible Assignee that shall
assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that:

 

(i)          the
Borrower shall have paid to the Administrative Agent the assignment fee (if any) specified in Section 9.4;

 

(ii)         such
Lender shall have received payment of an amount equal to the outstanding principal of its Loans and participations in LC Disbursements,
accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents (including
any amounts under Section 2.16) from the assignee (to the extent of such outstanding principal and accrued interest
and fees) or the Borrower (in the case of all other amounts);

 

(iii)        in
the case of any such assignment resulting from a claim for compensation under Section 2.14 or payments required to
be made pursuant to Section 2.17, such assignment will result in a reduction in such compensation or payments thereafter;

 

(iv)        in
the case of any such assignment resulting from a notice of illegality under Section 2.15, such assignment will eliminate
such illegality;

 

(v)         such
assignment does not conflict with Applicable Law; and

 

(vi)        in
the case of any assignment resulting from a Lender becoming a Non-Consenting Lender, the applicable assignee shall have consented
to the applicable amendment, waiver or consent.

 

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A Lender shall not be required to make any such assignment or
delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to
require such assignment and delegation cease to apply. Each Lender and Issuing Bank hereby grants to the Administrative Agent an
irrevocable power of attorney (which power is coupled with an interest) to execute and deliver, on behalf of such Lender or Issuing
Bank, as the case may be, as assignor, any Assignment and Assumption necessary to effect any assignment of such Lender’s
or Issuing Bank’s interests hereunder in the circumstances contemplated by this Section 2.20. Each Lender agrees
that if the Borrower exercises its option hereunder to cause an assignment by such Lender as an Increased Cost Lender, Non-Consenting
Lender or Defaulting Lender, such Lender shall, promptly after receipt of written notice of such election, execute and deliver
all documentation necessary to effect such assignment in accordance with Section 9.4. In the event that a Lender does
not comply with the requirements of the immediately preceding sentence within one Business Day after receipt of such notice, each
Lender hereby authorizes and directs the Administrative Agent to execute and deliver such documentation as may be required to give
effect to an assignment in accordance with Section 9.4 on behalf of an Increased Cost Lender, Non-Consenting Lender
or Defaulting Lender and any such documentation so executed by the Administrative Agent shall be effective for purposes of documenting
an assignment pursuant to Section 9.4.

 

Section 2.21         Cash
Collateral. At any time that there shall exist a Defaulting Lender, within one Business
Day following the written request of the Administrative Agent or any Issuing Bank (with a copy to the Administrative Agent), the
Borrower shall Cash Collateralize the Issuing Banks’ Fronting Exposures with respect to such Defaulting Lender (determined
after giving effect to Section 2.22(a)(iv) and any Cash Collateral provided by such Defaulting Lender) in an amount
not less than the Minimum Cash Collateral Amount.

 

(a)          Grant
of Security Interest. The Borrower, and to the extent provided by any Defaulting Lender, such Defaulting Lender, hereby grants
to the Administrative Agent, for the benefit of the Issuing Banks, and agrees to maintain, a first priority security interest in
all such Cash Collateral as security for such Defaulting Lender’s obligation to fund participations in respect of LC Exposure,
to be applied pursuant to clause (b) below. If, at any time, the Administrative Agent determines that Cash Collateral
is subject to any right or claim of any Person other than the Administrative Agent and the Issuing Banks or the Permitted Secured
Notes Agent, as herein provided, or that the total amount of such Cash Collateral is less than the Minimum Cash Collateral Amount,
the Borrower will, promptly upon demand by the Administrative Agent, pay or provide to the Administrative Agent additional Cash
Collateral in an amount sufficient to eliminate such deficiency (after giving effect to any Cash Collateral provided by the applicable
Defaulting Lender).

 

(b)          Application.
Notwithstanding anything to the contrary contained in this Agreement, Cash Collateral provided under this Section 2.21
or Section 2.22 in respect of Letters of Credit shall be applied to the satisfaction of the Defaulting Lender’s
obligation to fund participations in respect of LC Exposure (including, as to Cash Collateral provided by a Defaulting Lender,
any interest accrued on such obligation) for which the Cash Collateral was so provided, prior to any other application of such
property as may otherwise be provided for herein.

 

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(c)          Termination
of Requirement. Cash Collateral (or the appropriate portion thereof) provided to reduce any Issuing Bank’s Fronting Exposure
shall no longer be required to be held as Cash Collateral pursuant to this Section 2.21 following (i) the elimination
of the applicable Fronting Exposure (including by the termination of Defaulting Lender status of the applicable Lender) or (ii)
the determination by the Administrative Agent and each Issuing Bank that there exists excess Cash Collateral; provided that,
subject to Section 2.22, the Person providing Cash Collateral and each Issuing Bank may agree that Cash Collateral
shall be held to support future anticipated Fronting Exposure or other obligations; and provided further that, to
the extent that such Cash Collateral was provided by the Borrower, such Cash Collateral shall remain subject to the security interest
granted pursuant to the Loan Documents.

 

Section 2.22         Defaulting
Lenders.

 

(a)          Defaulting
Lender Adjustments. Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting
Lender, then, until such time as such Lender is no longer a Defaulting Lender, to the extent permitted by Applicable Law:

 

(i)          Waivers
and Amendments. Such Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect
to this Agreement or any other Loan Document shall be restricted as set forth in the definitions of “Majority Lenders”
and “Required Lenders.”

 

(ii)         Defaulting
Lender Waterfall. Any payment of principal, interest, fees or other amounts received by the Administrative Agent for the account
of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article VII or otherwise), or received
by the Administrative Agent from a Defaulting Lender pursuant to Section 9.8, shall be applied at such time or times
as may be determined by the Administrative Agent as follows: first, to the payment of any amounts owing by such Defaulting
Lender to the Administrative Agent hereunder; second, to the payment on a pro rata basis of any amounts owing by such Defaulting
Lender to any Issuing Bank hereunder; third, to Cash Collateralize the Issuing Banks’ Fronting Exposures with respect
to such Defaulting Lender in accordance with Section 2.21; fourth, as the Borrower may request (so long as no
Default exists), to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as
required by this Agreement, as determined by the Administrative Agent; fifth, if so determined by the Administrative Agent
in its discretion, to be held in a deposit account as Cash Collateral for release in such order as the Administrative Agent shall
determine in order to satisfy (x) such Defaulting Lender’s potential future funding obligations with respect to Loans under
this Agreement, (y) the Issuing Banks’ future Fronting Exposure with respect to such Defaulting Lender with respect to future
Letters of Credit issued under this Agreement, in accordance with Section 2.21, and (z) such Defaulting Lender’s
future indemnity obligations to the Administrative Agent under this Agreement; sixth, to the payment of any amounts owing
to the Lenders or the Issuing Banks as a result of any judgment of a court of competent jurisdiction obtained by any Lender or
the Issuing Banks against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under
this Agreement; seventh, so long as no Default exists, to the payment of any amounts owing to the Borrower as a result of
any judgment of a court of competent jurisdiction obtained by the Borrower against such Defaulting Lender as a result of such Defaulting
Lender’s breach of its obligations under this Agreement; and eighth, to such Defaulting Lender or as otherwise directed
by a court of competent jurisdiction; provided that, if (x) such payment is a payment of the principal amount of any Loans
or LC Disbursements in respect of which such Defaulting Lender has not fully funded its appropriate share and (y) such Loans were
made, or the related Letters of Credit were issued, at a time when the conditions set forth in Section 4.2 were satisfied
or waived, such payment shall be applied solely to pay the Loans of, and LC Disbursements owed to, all Non-Defaulting Lenders on
a pro rata basis prior to being applied to the payment of any Loans of, or LC Disbursements owed to, such Defaulting Lender until
such time as all Loans and funded and unfunded participations in LC Exposure are held by the Lenders pro rata in accordance with
the Commitments without giving effect to Section 2.22(a)(iv). Any payments, prepayments or other amounts paid or payable
to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post Cash Collateral pursuant
to this Section 2.22(a)(ii) shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably
consents hereto.

 

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(iii)        Certain
Fees.

 

(1)         No
Defaulting Lender shall be entitled to receive any commitment fee pursuant to Section 2.11(a) for any period during
which that Lender is a Defaulting Lender (and the Borrower shall not be required to pay any such fee that otherwise would have
been required to have been paid to that Defaulting Lender).

 

(2)         Each
Defaulting Lender shall be entitled to receive participation fees under Section 2.11(b) with respect to its participation
in Letters of Credit for any period during which that Lender is a Defaulting Lender only to the extent allocable to its Applicable
Percentage of the stated amount of Letters of Credit for which it has provided Cash Collateral pursuant to Section 2.21.

 

(3)         With
respect to any participation fees with respect to Letters of Credit not required to be paid to any Defaulting Lender pursuant to
clause (2) above, the Borrower shall (x) pay to each Non-Defaulting Lender that portion of any such fee otherwise payable
to such Defaulting Lender with respect to such Defaulting Lender’s participation in LC Exposure that has been reallocated
to such Non-Defaulting Lender pursuant to clause (iv) below, (y) pay to each Issuing Bank the amount of any such fee
otherwise payable to such Defaulting Lender to the extent allocable to such Issuing Bank’s Fronting Exposure to such Defaulting
Lender and (z) not be required to pay the remaining amount of any such fee.

 

(iv)        Reallocation
of Participations to Reduce Fronting Exposure. All or any part of such Defaulting Lender’s participation in LC Exposure
shall be reallocated among the Non-Defaulting Lenders in accordance with their respective Applicable Percentages (calculated without
regard to such Defaulting Lender’s Commitment) but only to the extent that (x) the conditions set forth in Section 4.2
are satisfied at the time of such reallocation (and, unless the Borrower shall have otherwise notified the Administrative Agent
at such time, the Borrower shall be deemed to have represented and warranted that such conditions are satisfied at such time) and
(y) such reallocation does not cause the aggregate Credit Exposure of any Non-Defaulting Lender to exceed such Non-Defaulting
Lender’s Commitment. No reallocation hereunder shall constitute a waiver or release of any claim of any party hereunder against
a Defaulting Lender arising from that Lender having become a Defaulting Lender, including any claim of a Non-Defaulting Lender
as a result of such Non-Defaulting Lender’s increased exposure following such reallocation.

 

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(b)          Defaulting
Lender Cure. If the Borrower, the Administrative Agent, and each Issuing Bank agree in writing that a Lender is no longer a
Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in
such notice and subject to any conditions set forth therein (which may include arrangements with respect to any Cash Collateral),
that Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such
other actions as the Administrative Agent may determine to be necessary to cause the Loans and funded and unfunded participations
in Letters of Credit to be held pro rata by the Lenders in accordance with the Commitments (without giving effect
to Section 2.22(a)(iv)), whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustment
will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while that Lender was
a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected
parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder
arising from that Lender’s having been a Defaulting Lender.

 

(c)          New
Letters of Credit. So long as any Lender is a Defaulting Lender, no Issuing Bank shall be required to issue, extend, renew
or increase any Letter of Credit unless it is satisfied that it will have no Fronting Exposure after giving effect thereto.

 

Section 2.23         Disposition
of Proceeds. The Security Documents contain an assignment by the Borrower and/or the Guarantors unto and in favor of the Administrative
Agent for the benefit of the Lenders of all of the Borrower’s or each Guarantor’s interest in and to production and
all proceeds attributable thereto which may be produced from or allocated to the Mortgaged Property. The Security Documents further
provide in general for the application of such proceeds to the satisfaction of the Indebtedness and other obligations described
therein and secured thereby. Notwithstanding the assignment contained in such Security Documents, until the occurrence of an Event
of Default, (a) the Administrative Agent and the Lenders agree that they will neither notify the purchaser or purchasers of such
production nor take any other action to cause such proceeds to be remitted to the Administrative Agent or the Lenders, but the
Lenders will instead permit such proceeds to be paid to the Borrower and its Subsidiaries and (b) the Lenders hereby authorize
the Administrative Agent to take such actions as may be necessary to cause such proceeds to be paid to the Borrower and/or such
Subsidiaries.

 

ARTICLE
III

Representations and Warranties

 

The Borrower represents and warrants to
the Administrative Agent, the Issuing Banks and the Lenders that:

 

Section 3.1           Organization;
Powers. Each Loan Party is duly organized, validly existing and in good standing under the laws of the jurisdiction of its
organization, has all requisite power and authority to carry on its business as now conducted and, except where the failure to
do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect, is qualified
to do business in, and is in good standing in, every jurisdiction where such qualification is required.

 

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Section 3.2           Authorization;
Enforceability. The Transactions are within the corporate powers of the Loan Parties and have been duly authorized by all necessary
corporate and, if required, stockholder or membership action. This Agreement has been, and each other Loan Document, when delivered
hereunder, will have been, duly executed and delivered by each Loan Party that is a party thereto and constitutes, or will constitute,
a legal, valid and binding obligation of such Loan Party, enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles
of equity, regardless of whether considered in a proceeding in equity or at law.

 

Section 3.3           Governmental
Approvals; No Conflicts. The Transactions (a) do not require any consent or approval of, registration or filing with, or any
other action by, any Governmental Authority or any other Person, except such as have been obtained or made and are in full force
and effect, (b) will not violate any Applicable Law or the Organization Documents of the Borrower or any Subsidiary or any order
of any Governmental Authority, (c) will not violate or result in a default under any indenture, agreement or other instrument binding
upon the Borrower or any Subsidiary or their assets, or give rise to a right thereunder to require any payment to be made by the
Borrower or any Subsidiary and (d) will not result in the creation or imposition of any Lien on any asset of the Borrower or any
Restricted Subsidiary (except for Liens under the Security Documents and the Permitted Secured Notes Documents).

 

Section 3.4           Financial
Condition; No Material Adverse Effect. (a) The Borrower has heretofore furnished to the Lenders (i) consolidated and consolidating
balance sheet and statements of income, equity and cash flows as of and for the fiscal year ended 2013, reported on by Hein &
Associates, LLP, independent public accountants, and (ii) consolidated financial statements as of and for the fiscal quarters ended
March 31, 2014 and June 30, 2014, certified by its chief financial officer. Such financial statements present fairly in all
material respects the financial position and results of operations and cash flows of the Borrower and its consolidated Subsidiaries
as of such dates and for such periods in accordance with GAAP, subject to year-end audit adjustments and the absence of footnotes
in the case of the statements referred to in clause (ii) above.

 

(b)          Except
as set forth on Schedule 3.4, no Loan Party has any material liabilities, contingent or otherwise, or forward or long-term
commitments that are not disclosed in the financial statements referred to in Section 3.4(a) or in the notes thereto.
No Material Adverse Effect has occurred since December 31, 2013, and no other facts or circumstances exist that have had or
could reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect.

 

(c)          All
balance sheets, all statements of income and of cash flows and all other financial information of the Borrower and its Subsidiaries
furnished pursuant to Section 5.1(a) and (b) have been and will for periods following the Effective Date
be prepared in accordance with GAAP consistently applied with the financial statements referred to in Section 3.4(a),
and do or will present fairly in all material respects the consolidated financial condition of the Persons covered thereby as at
the dates thereof and the results of their operations for the periods then ended.

 

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Section 3.5           Properties;
Titles, Etc.

 

(a)          Except
as disclosed in Schedule 3.5 and except for the Oil and Gas Properties Disposed of as permitted by this Agreement, each
of the Borrower and the Restricted Subsidiaries has good and defensible title to the Oil and Gas Properties evaluated in the most
recently delivered Reserve Report and good title to all its personal Properties, in each case, free and clear of all Liens except
Liens permitted by Section 6.3. Except as disclosed in Schedule 3.5 and except for the Oil and Gas Properties
Disposed of as permitted by this Agreement, after giving full effect to the Permitted Encumbrances, the Borrower or the Restricted
Subsidiary specified as the owner owns the net interests in production attributable to the Hydrocarbon Interests as reflected in
the most recently delivered Reserve Report, and the ownership of such Properties shall not in any material respect obligate the
Borrower or such Restricted Subsidiary to bear the costs and expenses relating to the maintenance, development and operations of
each such Property in an amount in excess of the working interest of each Property set forth in the most recently delivered Reserve
Report that is not offset by a corresponding proportionate increase in the Borrower’s or such Restricted Subsidiary’s
net revenue interest in such Property.

 

(b)          All
material leases and agreements necessary for the conduct of the business of the Borrower and the Restricted Subsidiaries are valid
and subsisting, in full force and effect, and there exists no default or event or circumstance which with the giving of notice
or the passage of time or both would give rise to a default under any such lease or leases, which could reasonably be expected
to result in a Material Adverse Effect.

 

(c)          The
rights and Properties presently owned, leased or licensed by the Borrower and the Restricted Subsidiaries including, without limitation,
all easements and rights of way, include all rights and Properties necessary to permit the Borrower and the Restricted Subsidiaries
to conduct their business in all material respects in the same manner as its business has been conducted prior to the date hereof.

 

(d)          All
of the Properties of the Borrower and the Restricted Subsidiaries (other than the Oil and Gas Properties, which are addressed in
Section 3.23) which are reasonably necessary for the operation of their businesses are in good working condition and
are maintained in accordance with prudent business standards.

 

(e)          The
Borrower and each Restricted Subsidiary owns, or is licensed to use, all trademarks, tradenames, copyrights, patents and other
intellectual Property material to its business, and the use thereof by the Borrower and such Restricted Subsidiary does not infringe
upon the rights of any other Person, except for any such infringements that, individually or in the aggregate, could not reasonably
be expected to result in a Material Adverse Effect. The Borrower and its Restricted Subsidiaries either own or have valid licenses
or other rights to use all databases, geological data, geophysical data, engineering data, seismic data, maps, interpretations
and other technical information used in their businesses as presently conducted, subject to the limitations contained in the agreements
governing the use of the same, which limitations are customary for companies engaged in the business of the exploration and production
of Hydrocarbons, with such exceptions as could not reasonably be expected to have a Material Adverse Effect.

 

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Section 3.6           Litigation
and Environmental Matters.

 

(a)          There
are no actions, suits or proceedings by or before any arbitrator or Governmental Authority pending against or, to the knowledge
of the Borrower, threatened against or affecting any Loan Party (i) as to which there is a reasonable possibility of an adverse
determination and that, if adversely determined, could reasonably be expected, individually or in the aggregate, to result in a
Material Adverse Effect (other than the Disclosed Matters) or (ii) as to which there is a reasonable possibility of an adverse
determination, that involve, and, if adversely determined, could reasonably be expected to adversely affect, this Agreement, any
other Loan Document or the Transactions.

 

(b)          Except
for the Disclosed Matters and except with respect to any other matters that, individually or in the aggregate, could not reasonably
be expected to result in a Material Adverse Effect, no Loan Party (i) has failed to comply with any Environmental Law or to
obtain, maintain or comply with any permit, license or other approval required under any Environmental Law, (ii) has become
subject to any Environmental Liability, (iii) has received notice of any claim with respect to any Environmental Liability
or (iv) knows of any basis for any Environmental Liability.

 

(c)          Except
for the Disclosed Matters and except with respect to any other matters that, individually or in the aggregate, could not reasonably
be expected to result in a Material Adverse Effect, with respect to any real property owned or leased by any Loan Party, (i) there
has been no release of Hazardous Materials at, from, or to the real property, including the soils, surface waters, or ground waters
thereof, and (ii) there are no conditions at the real property which, with the passage of time, or giving of notice, or both, would
be reasonably likely to result in an Environmental Liability.

 

(d)          Since
the date of this Agreement, there has been no change in the status of the Disclosed Matters that, individually or in the aggregate,
has resulted in, or could reasonably be expected to result in, a Material Adverse Effect.

 

Section 3.7           Compliance
with Laws and Agreements.

 

(a)          Each
Loan Party is in compliance with all Applicable Law, except where the failure to do so, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect. Each Loan Party is in compliance with all indentures, agreements
and other instruments binding upon it or its property, except where the failure to do so, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect. No Default has occurred and is continuing or would result from
the consummation of the Transactions.

 

(b)          No
Loan Party is in default nor has any event or circumstance occurred which, but for the expiration of any applicable grace period
or the giving of notice, or both, would constitute a default or would require any Loan Party to Redeem or make any offer to Redeem
under any indenture, note, credit agreement or instrument pursuant to which any Material Indebtedness is outstanding or by which
any Loan Party or any of their Properties is bound.

 

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Section 3.8           Investment
Company Status; Other Laws. No Loan Party is an “investment company” as defined in, or subject to regulation under,
the Investment Company Act of 1940 or is subject to any other law restricting its ability to incur Indebtedness.

 

Section 3.9           Taxes.
Each Loan Party has timely filed or caused to be filed all federal and other material Tax returns and reports required to have
been filed and has paid or caused to be paid all federal and other material Taxes required to have been paid by it, except Taxes
that are being contested in good faith by appropriate proceedings and for which the Borrower or such other Loan Party, as applicable,
has set aside on its books adequate reserves or to the extent that the failure to do so could not reasonably be expected to result
in a Material Adverse Effect.

 

Section 3.10         ERISA
Compliance. Each Plan is in compliance in all material respects with all applicable requirements of ERISA, the IRC and other
Applicable Law, except where failure to so comply could not reasonably be expected to result in a Material Adverse Effect. No ERISA
Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events for which liability
is reasonably expected to occur, could reasonably be expected to result in a Material Adverse Effect. As of the most recent valuation
date for any Pension Plan, the funding target attainment percentage (as defined in Section 430 of the IRC) is 60% or higher and
no facts or circumstances exist that could reasonably be expected to cause the funding target attainment percentage to drop below
such threshold as of the most recent valuation date.

 

Section 3.11         Insurance.
Set forth on Schedule 3.11 is a complete and accurate summary of the property and casualty insurance program of the
Loan Parties as of the Effective Date (including the names of all insurers, policy numbers, expiration dates, amounts and types
of coverage, self-insured retention and a description in reasonable detail of any self-insurance program, retrospective rating
plan, fronting arrangement or other risk assumption arrangement involving any Loan Party). The properties of the Borrower and its
Restricted Subsidiaries are insured with financially sound and reputable insurance companies not Affiliates of the Borrower, in
such amounts, with such deductibles and covering such risks as are customarily carried by companies engaged in similar businesses
and owning similar properties in localities where the Borrower or the applicable Restricted Subsidiary operates.

 

Section 3.12         Margin
Regulations. No Loan Party is engaged or will engage, principally or as one of its important activities, in the business of
purchasing or carrying margin stock (within the meaning of Regulation U), or extending credit for the purpose of purchasing or
carrying margin stock. Following the application of the proceeds of each Borrowing or drawing under each Letter of Credit, not
more than 25% of the value of the assets (either of the Borrower only or of the Borrower and its Subsidiaries on a consolidated
basis) subject to the provisions of Section 6.3 or Section 6.5 or subject to any restriction contained
in any agreement or instrument between the Borrower or any Subsidiary and any Lender or any Affiliate of any Lender relating to
Indebtedness and within the scope of Section 7.1(g) will be margin stock.

 

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Section 3.13         Subsidiaries;
Equity Interests. On the Effective Date, the Borrower has no Domestic Subsidiaries other than AMZG, Inc. The Borrower has no
Subsidiaries other than those specifically disclosed in Part I of Schedule 3.13, and any Subsidiaries that are permitted
to have been organized or acquired after the Effective Date in accordance with Section 6.6 and all of the outstanding
Equity Interests in such Subsidiaries have been validly issued, are fully paid and nonassessable and, as of the Effective Date,
are owned by a Loan Party in the amounts specified on Part I of Schedule 3.13 free and clear of all Liens (other
than Liens under the Security Documents and the Permitted Secured Notes Documents and the Liens securing the Debt to be Repaid).
The Borrower has no equity investments in any other Person other than those specifically disclosed in Part II of Schedule
3.13 or permitted to have been acquired after the Effective Date in accordance with Section 6.6.

 

Section 3.14         Anti-Money
Laundering and Anti-Terrorism Finance Laws. To the extent applicable, each Loan Party and each Subsidiary thereof is in compliance
with anti-money laundering laws and anti-terrorism finance laws including the Bank Secrecy Act and the PATRIOT Act (the “Anti-Terrorism
Laws”).

 

Section 3.15         Disclosure.
None of the reports, financial statements, certificates or other written information furnished by or on behalf of any Loan Party
to the Administrative Agent or any Lender in connection with the negotiation of this Agreement or delivered hereunder (as modified
or supplemented by other information so furnished) contains any material misstatement of fact or omits to state any material fact
necessary to make the statements therein, taken as a whole and in the light of the circumstances under which they were made, not
misleading; provided that, with respect to projected financial information, the Borrower represents only that such information
was prepared in good faith based upon assumptions believed to be reasonable at the time. There are no statements or conclusions
in any Reserve Report or any projections delivered under Section 6.18 which are based upon or include misleading information
or fail to take into account material information regarding the matters reported therein, it being understood that projections
concerning volumes attributable to the Oil and Gas Properties and production and cost estimates contained in each Reserve Report
or any projections delivered under Section 6.18 are necessarily based upon professional opinions, estimates and projections
and that the Borrower and the Subsidiaries do not warrant that such opinions, estimates and projections will ultimately prove to
have been accurate.

 

Section 3.16         Security
Documents. (a) The Guarantee and Collateral Agreement is effective to create in favor of the Administrative Agent, for the
benefit of the holders of Secured Obligations, a legal, valid and enforceable security interest in the Collateral described therein
and proceeds thereof. When financing statements and other filings in appropriate form are or have been filed in the appropriate
offices, the Guarantee and Collateral Agreement shall constitute a fully perfected Lien on, and security interest in, all right,
title and interest of the Loan Parties in such Collateral and the proceeds thereof to the extent a security interest can be perfected
by filing or other action required thereunder as security for the Secured Obligations, in each case prior and superior in right
to any other Person (except Liens permitted by Section 6.3).

 

(b)          Each
of the Mortgages is effective to create in favor of the Administrative Agent, for the benefit of the holders of Secured Obligations,
a legal, valid and enforceable Lien on the mortgaged properties described therein and proceeds thereof and when the Mortgages are
or have been filed in the appropriate offices, each such Mortgage shall constitute a fully perfected Lien on, and security interest
in, all right, title and interest of the Loan Parties in such properties and the proceeds thereof, as security for the Secured
Obligations, in each case prior and superior in right to any other Person (except for Permitted Encumbrances).

 

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Section 3.17         Solvency,
etc. On the Effective Date, and immediately prior to and after giving effect to the issuance of each Letter of Credit and each
Borrowing hereunder and the use of the proceeds thereof, with respect to each Loan Party, individually, (a) the fair value of its
assets is greater than the amount of its liabilities (including disputed, contingent and unliquidated liabilities) as such value
is established and liabilities evaluated, (b) the present fair saleable value of its assets is not less than the amount that will
be required to pay the probable liability on its debts as they become absolute and matured, (c) it is able to realize upon its
assets and pay its debts and other liabilities (including disputed, contingent and unliquidated liabilities) as they mature in
the normal course of business, (d) it does not intend to, and does not believe that it will, incur debts or liabilities beyond
its ability to pay as such debts and liabilities mature and (e) it is not engaged in business or a transaction, and is not about
to engage in business or a transaction, for which its property would constitute unreasonably small capital.

 

Section 3.18         [Intentionally
Omitted].

 

Section 3.19         Labor
Matters. Except as set forth on Schedule 3.19, no Loan Party is subject to any labor or collective bargaining agreement.
There are no existing or threatened strikes, lockouts or other labor disputes involving any Loan Party that singly or in the aggregate
could reasonably be expected to have a Material Adverse Effect.

 

Section 3.20         Material
Agreements. All material agreements to which Borrower or any Subsidiary is a party or by which its assets are bound (including,
without limitation, all material credit agreements, indentures, purchase agreements, contracts, letters of credit, guarantees,
joint venture agreements, or other instruments, including any modifications or supplements thereto, as in effect on the date hereof
and as of the Effective Date) that are required to be filed with the SEC have been filed with the SEC. Except as detailed otherwise
in Schedule 3.20, the Borrower has heretofore made available to the Administrative Agent a complete and correct copy of
each such material agreement.

 

Section 3.21         Foreign
Corrupt Practices Act. No part of the proceeds of the Loans or Letters of Credit shall be used, directly or indirectly, for
any payments to any governmental official or employee, political party, official of a political party, candidate for political
office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage,
in violation of the United States Foreign Corrupt Practices Act of 1977.

 

Section 3.22         Sanctions
Laws. No Loan Party nor any Subsidiary thereof is any of the following (a “Restricted Person”): (a) a Person
that is listed in the annex to, or is otherwise subject to the provisions of, Executive Order No. 13224 on Terrorist Financing,
effective September 24, 2001 (the “Executive Order”); (b) a Person that is named as a “specially
designated national and blocked person” on the most current list published by the U.S. Treasury Department Office of Foreign
Assets Control (“OFAC”) at its official website or any replacement website or other replacement official publication
of such list or similarly named by any similar foreign governmental authority; (c) an agency of the government of a country, an
organization controlled by a country, or a Person resident in a country that is subject to a sanctions program identified on the
lists maintained by OFAC; or (d) a Person that derives more than 10% of its assets or operating income from investments in or transactions
with any such country, agency, organization or person. Further, none of the proceeds from the Loans or Letters of Credit shall
be used to finance any operations, investments or activities in, or make any payments to, any such country, agency, organization
or Person subject to OFAC sanctions.

 

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Section 3.23         Maintenance
of Properties. Except for such acts or failures to act as could not be reasonably expected to have a Material Adverse Effect,
the Oil and Gas Properties (and Properties unitized therewith) have been maintained, operated and developed in a good and workmanlike
manner and in conformity with all Applicable Laws and in conformity with the provisions of all leases, subleases or other contracts
comprising a part of the Hydrocarbon Interests and other contracts and agreements forming a part of the Oil and Gas Properties.
Specifically in connection with the foregoing, except for those as could not be reasonably expected to have a Material Adverse
Effect, (a) no Oil and Gas Property is subject to having allowable production reduced below the full and regular allowable (including
the maximum permissible tolerance) because of any overproduction (whether or not the same was permissible at the time) and (b)
none of the wells comprising a part of the Oil and Gas Properties (or Properties unitized therewith) is deviated from the vertical
more than the maximum permitted by Applicable Laws, and such wells are, in fact, bottomed under and are producing from, and the
well bores are wholly within, the Oil and Gas Properties (or in the case of wells located on Properties unitized therewith, such
unitized Properties). The wells drilled in respect of proved producing Oil and Gas Properties described in the most recent Reserve
Report (other than wells drilled in respect of such proved producing Oil and Gas Properties that have been subsequently Disposed
of in accordance with the terms of this Agreement) are capable of, and are presently, either producing Hydrocarbons in commercially
profitable quantities or in the process of being worked over or enhanced, and the Loan Party that owns such proved producing Oil
and Gas Properties is currently receiving payments for its share of production, with no funds in respect of any thereof being presently
held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders. All pipelines,
wells, gas processing plants, platforms and other material improvements, fixtures and equipment owned in whole or in part by the
Borrower or any of its Restricted Subsidiaries that are necessary to conduct normal operations are being maintained in a state
adequate to conduct normal operations, and with respect to such of the foregoing which are operated by the Borrower or any of its
Restricted Subsidiaries, in a manner consistent with the Borrower’s or its Restricted Subsidiaries’ past practices
(other than those the failure of which to maintain in accordance with this Section 3.23 could not reasonably be expect
to have a Material Adverse Effect).

 

Section 3.24         Gas
Imbalances, Prepayments. Except as set forth on Schedule 3.24 or on the most recent certificate delivered pursuant to
Section 5.13(c), on a net basis there are no gas imbalances, take or pay or other prepayments (including pursuant to
an Advance Payment Contract) which would require the Borrower or any of its Restricted Subsidiaries to deliver Hydrocarbons produced
from the Oil and Gas Properties at some future time without then or thereafter receiving full payment therefor exceeding 2% of
the annual production of gas of the Borrower and its Restricted Subsidiaries for the most recent calendar year, on an Mcf basis,
in the aggregate.

 

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Section 3.25         Marketing
of Production. Except for contracts listed and in effect on the date hereof on Schedule 3.25, and thereafter either
disclosed in writing to the Administrative Agent or included in the most recently delivered Reserve Report (with respect to all
of which contracts the Borrower represents that it or its Restricted Subsidiaries are receiving a price for all production sold
thereunder which is computed substantially in accordance with the terms of the relevant contract and are not having deliveries
curtailed substantially below the subject Property’s delivery capacity except as disclosed in Schedule 3.25 or the
most recently delivered Reserve Report or otherwise disclosed in writing to the Administrative Agent), no material agreements exist
which are not cancelable on 60 days notice or less without penalty or detriment for the sale of production from the Borrower’s
or its Restricted Subsidiaries’ Hydrocarbons (including, without limitation, calls on or other rights to purchase, production,
whether or not the same are currently being exercised) that (a) pertain to the sale of production at a fixed price and (b) have
a maturity or expiry date of longer than six (6) months from the date hereof or the date of disclosure to the Administrative Agent
in writing, as applicable.

 

Section 3.26         Hedging
Agreements. Schedule 3.26, as of the date hereof, and after the date hereof, each report required to be delivered by
the Borrower pursuant to Section 5.1(e), sets forth, a true and complete list of all Hedging Agreements of the Borrower
and each Restricted Subsidiary, the material terms thereof (including the type, term, effective date, termination date and notional
amounts or volumes), the net mark to market value thereof, all credit support agreements relating thereto (including any margin
required or supplied) and the counterparty to each such agreement.

 

Section 3.27         Location
of Business and Offices. The Borrower’s jurisdiction of organization is the State of Nevada; the name of the Borrower
as listed in the public records of the State of Nevada is American Eagle Energy Corporation; and the entity number of the Borrower
in the State of Nevada is C17822-2003 (or, in each case, as set forth in a notice delivered to the Administrative Agent pursuant
to Section 5.1(m) in accordance with Section 9.1(c)). The Borrower’s principal place of business
and chief executive offices are located at the address specified in Section 9.1 (or as set forth in a notice delivered
pursuant to Section 5.1(m) and Section 9.1(c)). Each Loan Party’s jurisdiction of organization, name
as listed in the public records of its jurisdiction of organization, organizational identification number in its jurisdiction of
organization, and the location of its principal place of business and chief executive office is stated on Schedule 3.27
(or as set forth in a notice delivered pursuant to Section 9.1(c)).

 

Section 3.28         Deposit
and Disbursement Accounts. Schedule 3.28 lists all banks and other financial institutions at which any Loan Party maintains
deposit accounts, lockbox accounts, disbursement accounts, investment accounts or other similar accounts as of the Effective Date,
and such Schedule correctly identifies the name, address and telephone number of each financial institution, the name in which
the account is held, the type of the account, and the complete account number therefor.

 

ARTICLE
IV

Conditions

 

Section 4.1           Effective
Date. The obligations of the Lenders to make Loans and of the Issuing Bank to issue Letters of Credit hereunder shall not become
effective until the date on which each of the following conditions is satisfied (or waived in accordance with Section 9.2):

 

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(a)          The
Administrative Agent (or its counsel) shall have received from each party hereto either (i) a counterpart of this Agreement
signed on behalf of such party or (ii) written evidence satisfactory to the Administrative Agent (which may include telecopy
transmission of a signed signature page of this Agreement) that such party has signed a counterpart of this Agreement.

 

(b)          The
Administrative Agent (or its counsel) shall have received evidence, reasonably satisfactory to it, that all Debt to be Repaid has
been (or concurrently with the initial Borrowing will be) paid in full, and that all agreements and instruments governing the Debt
to be Repaid and that all Liens securing such Debt to be Repaid have been (or concurrently with the initial Borrowing will be)
terminated.

 

(c)          The
Administrative Agent (or its counsel) shall have received evidence, reasonably satisfactory to it, that the Borrower has received
proceeds of not less than at least $150,000,000 from the issuance of Permitted Secured Debt, which shall be satisfactory in all
respects to the Administrative Agent.

 

(d)          The
Administrative Agent (or its counsel) shall have received the following, each in form and substance satisfactory to the Administrative
Agent:

 

(i)          a
counterpart of the Guarantee and Collateral Agreement executed by each Loan Party, together with all certificates, instruments,
transfer powers and other items required to be delivered in connection therewith (including, without limitation, original share
certificates and undated stock powers related to the Borrower’s and its Restricted Subsidiaries’ ownership interest
in EERG Energy ULC and AEE Canada Inc.);

 

(ii)         each
document (including Uniform Commercial Code financing statements) required by the Security Documents or under law or reasonably
requested by the Administrative Agent to be filed, registered or recorded in order to create in favor of the Administrative Agent,
for the benefit of the holders of Secured Obligations, a perfected Lien on the Collateral described therein, prior to all other
Liens (subject only to Liens permitted pursuant to Section 6.3), in proper form for filing, registration or recording;

 

(iii)        all
environmental site assessment reports requested by the Administrative Agent;

 

(iv)        certified
copies of Uniform Commercial Code and other Lien search reports dated a date near to the Effective Date, listing all effective
financing statements and other Lien filings that name any Loan Party (under their current names and any previous names) as debtors,
together with (A) copies of such financing statements or other Lien filings and (B) such Uniform Commercial Code termination statements
or amendments or other Lien terminations as the Administrative Agent may request;

 

(v)         such
documents and certificates as the Administrative Agent or its counsel may reasonably request relating to the organization, existence
and good standing of the Loan Parties, the authorization of the Transactions and any other legal matters relating to the Loan Parties,
this Agreement or the Transactions;

 

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(vi)        evidence
satisfactory to the Administrative Agent of the receipt of all consents required to effect the Transactions, including all regulatory
approvals and licenses, if applicable;

 

(vii)       evidence
of the existence of insurance required to be maintained pursuant to Section 5.5, together with evidence that the Administrative
Agent has been named as a lender’s loss payee and an additional insured on all related insurance policies;

 

(viii)      copies
of the Permitted Secured Notes Documents, certified by an authorized representative of the Borrower as being true, accurate and
complete;

 

(ix)         a
certificate, dated the Effective Date and signed by a Responsible Officer of the Borrower, confirming compliance with the conditions
set forth in clauses (a), (b) and (c) of Section 4.2;

 

(x)          a
solvency certificate as to the Borrower, executed by a Financial Officer;

 

(xi)         with
respect to the Oil and Gas Properties of the Borrower or any Restricted Subsidiary, a duly executed Mortgage providing for a fully
perfected Lien, in favor of the Administrative Agent, in all right, title and interest of the Borrower or such Restricted Subsidiary
in such Oil and Gas Property (and the Administrative Agent shall be reasonably satisfied that the Mortgages create first priority,
perfected Liens (subject only to Liens permitted by Section 6.3) on at least the Required Engineered Value of the Oil and
Gas Properties evaluated in the Initial Reserve Report); and

 

(xii)        a
counterpart of the Intercreditor Agreement executed by each party thereto, together with the Officers’ Certificate required
by the definition of “Priority Lien Debt” set forth in the Permitted Secured Notes Agreement, designating the Secured
Obligations as “Priority Lien Debt”;

 

(xiii)       the
Fee Letter, duly executed by the Borrower; and

 

(xiv)      a
Revolving Note payable to the order of SunTrust Bank.

 

(e)          The
Administrative Agent shall have received:

 

(i)          opinions,
dated the Effective Date and addressed to the Administrative Agent, the Issuing Bank and all Lenders, from Baker & Hostetler
LLP, special counsel to the Borrower, substantially in the form of Exhibit H-1 hereto; and

 

(ii)         favorable
opinions, substantially in the form of Exhibit H-2 hereto, from Lathrope & Gage LLP local counsel to the Loan Parties
in the States of North Dakota and Montana dated as of the Effective Date, in form and substance reasonably satisfactory to the
Administrative Agent and its counsel, which shall in any event include an opinion that the Mortgages delivered pursuant to Section 4.1(d)(xi),
and any corresponding UCC financing statements to be filed in the States of North Dakota and Montana, if any, are effective to
create a valid, perfected Lien in favor of the Administrative Agent on the Mortgaged Properties and the other Collateral Property
that constitutes real property located in the States of North Dakota and Montana and are in proper form for recordation in the
applicable state.

 

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(f)          Each
Lender shall have received payment of all fees and other amounts due and payable on or prior to the Effective Date, including,
to the extent invoiced, reimbursement or payment of all out-of-pocket expenses required to be reimbursed or paid by the Borrower
hereunder.

 

(g)          The
Administrative Agent and each Lender shall have received, at least five (5) Business Days prior to the Effective Date, all documentation
and other information required by bank regulatory authorities under applicable “know your customer” and anti-money
laundering rules and regulations, including the PATRIOT Act.

 

(h)          The
Administrative Agent shall have received title information as the Administrative Agent may reasonably require satisfactory to the
Administrative Agent setting forth the status of title to the Required Engineered Value of the Oil and Gas Properties evaluated
in the Initial Reserve Report.

 

(i)          The
Administrative Agent shall have received the financial statements referred to in Section 3.4(a) and the Initial Reserve
Report accompanied by a certificate covering the matters described in Section 5.13(c).

 

(j)          The
Administrative Agent shall have received a Compliance Certificate, evidencing pro forma compliance with Section 6.1.

 

(k)          The
Administrative Agent shall have received a schedule of all Hedge Agreements to which the Borrower and each Restricted Subsidiary
is a party, which schedule shall be attached hereto as Schedule 3.26.

 

(l)          The
Administrative Agent and the Lenders shall have received financial projections of the Borrower and its Subsidiaries for the four
fiscal year period commencing with Fiscal Year 2014 and continuing through Fiscal Year 2017, prepared by the Borrower in good-faith
and based on assumptions believed by the Borrower to be reasonable at the time made.

 

(m)          The
Administrative Agent shall have received such diligence, including legal, tax, accounting, business, financial and ERISA diligence,
as the Administrative Agent may reasonably require, each in form and substance satisfactory to the Administrative Agent.

 

(n)          The
Administrative Agent shall have received delivery of such other documents, certificates or information as the Administrative Agent
or the Required Lenders shall have reasonably requested.

 

The Administrative
Agent shall notify the Borrower and the Lenders of the Effective Date, and such notice shall be conclusive and binding. Notwithstanding
the foregoing, the obligations of the Lenders to make Loans and of the Issuing Banks to issue Letters of Credit hereunder shall
not become effective unless each of the foregoing conditions is satisfied (or waived pursuant to Section 9.2) at or
prior to 3:00 p.m. on September 4, 2014 (and, in the event such conditions are not so satisfied or waived, the Commitments shall
terminate at such time). For purposes of determining compliance with the conditions specified in this Section 4.1,
each Lender that has signed this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with,
each document or other matter required thereunder to be consented to or approved by or acceptable or satisfactory to a Lender unless
the Administrative Agent shall have received notice from such Lender prior to the proposed Effective Date specifying its objection
thereto.

 

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Section 4.2           Each
Credit Event. The obligation of each Lender to make a Loan on the occasion of any Borrowing, and of each Issuing Bank to issue,
amend or extend any Letter of Credit, is subject to the satisfaction of the following conditions:

 

(a)          The
representations and warranties of the Loan Parties set forth in the Loan Documents shall be true and correct in all material respects
on and as of the date of such Borrowing or the date of issuance, amendment or extension of such Letter of Credit, as applicable,
except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be
true and correct in all material respects as of such earlier date (except that any such representations and warranties that are
qualified materially shall be true and correct in all respects).

 

(b)          At
the time of and immediately after giving effect to such Borrowing or the issuance, amendment or extension of such Letter of Credit,
as applicable, no Default shall have occurred and be continuing.

 

(c)          At
the time of and immediately after giving effect to such Borrowing or the issuance, amendment, renewal or extension of such Letter
of Credit, as applicable, the total Credit Exposure shall not exceed the Borrowing Base then in effect.

 

(d)          The
Borrower shall deliver a certificate to the Administrative Agent executed by a Responsible Officer certifying that after giving
pro forma effect to such Borrowing or such Letter of Credit, the aggregate Credit Exposure hereunder shall not exceed the amount
permitted by Section 4.09(b)(1) of the Permitted Secured Notes Agreement, and such certificate shall set forth the calculation
of such permitted amount and attach the estimates of the Borrower’s petroleum engineers or independent petroleum engineers
required by the definition of “Adjusted Consolidated Net Tangible Assets” (as defined in the Permitted Secured Notes
Agreement as of the Effective Date).

 

(e)          Absence
of any event that could reasonably be expected to have a Material Adverse Effect; and

 

(f)          Receipt
of such other documents, certificates, information or legal opinions as the Administrative Agent or the Required Lenders shall
have reasonably requested.

 

Each Borrowing and each issuance, amendment or extension of
a Letter of Credit shall be deemed to constitute a representation and warranty by the Borrower on the date thereof as to the matters
specified in clauses (a), (b), (c), (d) and (e) of this Section.

 

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ARTICLE
V

Affirmative Covenants

 

The Borrower covenants and agrees with the
Administrative Agent, the Issuing Banks and the Lenders that, until the Termination Date:

 

Section 5.1           Financial
Statements and Other Information. The Borrower shall furnish to the Administrative Agent and each Lender:

 

(a)          Annual
Financial Statements. Within 90 days after the end of each fiscal year of the Borrower, its audited consolidated balance
sheet and related statements of operations and cash flows as of the end of and for such year, setting forth in each case in comparative
form the figures for the previous fiscal year, all reported on by Hein & Associates, LLP or other independent public accountants
reasonably acceptable to the Administrative Agent (without any qualification or exception which (i) is of a “going concern”
or similar nature, (ii) relates to the limited scope of examination of matters relevant to such financial statement or (iii) relates
to the treatment or classification of any item in such financial statement and which, as a condition to its removal, would require
an adjustment to such item the effect of which would be to cause the Borrower to be in Default) to the effect that such consolidated
financial statements present fairly in all material respects the financial condition and results of operations of the Borrower
and its consolidated Subsidiaries on a consolidated basis in accordance with GAAP consistently applied.

 

(b)          Quarterly
Financial Statements. Within 45 days after the end of each of the first three fiscal quarters of each fiscal year of the
Borrower, its balance sheet and related statements of operations, and cash flows as of the end of and for such fiscal quarter and
the then-elapsed portion of the fiscal year, setting forth in each case in comparative form the figures for the corresponding period
or periods of (or, in the case of the balance sheet, as of the end of) the previous fiscal year (commencing with the first such
financial statements delivered after delivery of the projected budget for the fiscal year ended December 31, 2014), all certified
by one of its Financial Officers as presenting fairly in all material respects the financial condition and results of operations
of the Borrower and its consolidated Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, subject
to normal year-end audit adjustments and the absence of footnotes.

 

(c)          Certificate
of Financial Officer – Compliance. Concurrently with any delivery of financial statements under clause (a)
or (b) above, (i) a Compliance Certificate of a Financial Officer of the Borrower (x) certifying as to whether a Default
has occurred and, if a Default has occurred, specifying the details thereof and any action taken or proposed to be taken with respect
thereto, (y) setting forth reasonably detailed calculations demonstrating compliance with Section 6.1 and (z) stating
whether any change in GAAP or in the application thereof has occurred since the date of the audited financial statements referred
to in Section 3.4 and, if any such change has occurred, specifying the effect of such change on the financial statements
accompanying such certificate and (ii) separate schedules reflecting the balance sheet information income and cash flows of the
Unrestricted Subsidiaries and reconciling such information to the financial statements described above.

 

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(d)          Reserved.

 

(e)          Certificate
of Financial Officer — Hedging Agreements.

 

(i)          Concurrently
with the delivery of each Reserve Report hereunder, a certificate of a Financial Officer, in form and substance reasonably satisfactory
to the Administrative Agent, setting forth as of a recent date, a true and complete list of all Hedging Agreements of the Borrower
and each Restricted Subsidiary, the material terms thereof (including the type, term, effective date, termination date and notional
amounts or volumes), the net mark-to-market value thereof, any new credit support agreements relating thereto not listed on Schedule
3.26, any margin required or supplied under any credit support document, and the counterparty to each such agreement.

 

(ii)         Together
with the delivery of the Compliance Certificate under Section 5.1(c), the Borrower will deliver a certificate of a
Financial Officer comparing aggregate notional volumes of all Hedging Agreements of the Borrower and each Restricted Subsidiary,
which were in effect during such period (other than basis differential Hedgings) and the actual production volumes for each of
natural gas and crude oil during such period, which certificate shall certify that the hedged volumes for each of natural gas and
crude oil did not exceed 100% of actual production or if such hedged volumes did exceed actual production, specify the amount of
such excess.

 

(f)          Management
Reports. Promptly upon receipt thereof, copies of all detailed audit reports, management letters or recommendations submitted
to the Borrower by independent auditors in connection with the accounts or books of any Loan Party or any Subsidiary thereof, or
any audit of any of them.

 

(g)          SEC
and Other Filings. Promptly after the same become publicly available, copies of all periodic and other reports, proxy statements
and other materials filed by the Borrower or any Subsidiary with the SEC, or with any national securities exchange, as the case
may be.

 

(h)          Permitted
Secured Notes Notices. Promptly following the giving or receipt of any statement, notice or report delivered under the terms
of any Permitted Secured Notes Document (to the extent not otherwise furnished or made available hereunder) copies of such notice
or report and promptly following the execution of any amendment, modification or supplement to the Intercreditor Agreement or any
Permitted Secured Notes Document, a copy of any such amendment, modification or supplement.

 

(i)          Certificate
of Insurer — Insurance Coverage. Concurrently with any delivery of financial statements under Section 5.1(a),
a certificate of insurance coverage from each insurer with respect to the insurance required by Section 5.5, in form and
substance satisfactory to the Administrative Agent, and, if requested by the Administrative Agent or any Lender, all copies of
the applicable policies.

 

(j)          Lists
of Purchasers. Concurrently with the delivery of any Reserve Report to the Administrative Agent pursuant to Section 5.13,
a list of Persons purchasing Hydrocarbons from the Borrower or any Restricted Subsidiary accounting for at least 80% of the revenues
resulting from the sale of all Hydrocarbons in the one-year period prior to the “as of” date of such Reserve Report.

 

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(k)          Notice
of Sales of Oil and Gas Properties. In the event the Borrower or any Restricted Subsidiary intends to sell, transfer, assign
or otherwise dispose of any Oil or Gas Properties or any Equity Interests in any Subsidiary with a fair market value in excess
of $10,000,000 in accordance with Section 6.5, prior written notice of such Disposition, the price thereof and the
anticipated date of closing.

 

(l)          Notice
of Casualty Events. Prompt written notice, and in any event within three Business Days, of the occurrence of any Casualty Event
or the commencement of any action or proceeding that could reasonably be expected to result in a Casualty Event.

 

(m)          Information
Regarding Loan Parties. Prompt written notice (and in any event within 30 days prior thereto) of any change (i) in any Loan
Party’s corporate name or in any trade name used to identify such Person in the conduct of its business or in the ownership
of its Properties, (ii) in the location of any Loan Party’s chief executive office or principal place of business, (iii)
in any Loan Party’s identity or corporate structure or in the jurisdiction in which such Person is incorporated or formed,
(iv) in any Loan Party’s jurisdiction of organization or such Person’s organizational identification number in such
jurisdiction of organization, and (v) in any Loan Party’s federal taxpayer identification number.

 

(n)          Production
Report and Lease Operating Statements. Within 45 days after the end of each fiscal quarter, a report setting forth, for each
calendar month during the then current fiscal year to date, the volume of production and sales attributable to production (and
the prices at which such sales were made and the revenues derived from such sales) for each such calendar month from the Oil and
Gas Properties, and setting forth the related ad valorem, severance and production taxes and lease operating expenses attributable
thereto and incurred for each such calendar month.

 

(o)          Projected
Budget. Concurrently with the delivery to the Administrative Agent of a Reserve Report prepared by Approved Petroleum Engineers
in Section 5.13(a), a report, in a form satisfactory to the Administrative Agent, prepared by or on behalf of the Borrower
detailing on a monthly basis for the next 12 month period (i) the projected production of Hydrocarbons by the Borrower and the
Restricted Subsidiaries and the assumptions used in calculating such projections, (ii) an annual operating budget for the Borrower
and the Restricted Subsidiaries, with a breakdown of those capital expenditures to be used for the development of proved undeveloped
reserves in the Oil and Gas Properties of the Borrower and the Restricted Subsidiaries, and the assumptions used in calculating
such projections, and (iv) such other information as may be reasonably requested by the Administrative Agent.

 

(p)          Unrestricted
Subsidiaries, etc. If the Borrower or any Restricted Subsidiary has (subject to the requirements and limitations of this Agreement
and the other Loan Documents) formed or acquired a new Restricted Subsidiary or Disposed of or dissolved a Restricted Subsidiary,
or redesignated an Unrestricted Subsidiary as a Restricted Subsidiary or a Restricted Subsidiary as an Unrestricted Subsidiary
(in each case, in accordance with Section 1.7), or made any additional equity investment in any Person or Disposed
of any equity investment in any Person, in each case, since the date of the most recently delivered schedule, a substitute (or
supplement to) Schedule 3.13.

 

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(q)          Permitted
Refinancing Debt Incurrence. Written notice at least five Business Days prior to the incurrence of any Permitted Refinancing
Debt, together with the most recent drafts of each Permitted Refinancing Document, and prompt delivery to the Administrative Agent
and the Lenders copies, certified by a Responsible Officer as true and complete, of each Permitted Refinancing Document following
the incurrence of any Permitted Refinancing Debt.

 

(r)          Notice
of Liens. In the event that the Borrower or any Subsidiary intends to grant any Lien on any Property to secure any Permitted
Secured Debt or Permitted Refinancing Debt, the Borrower will provide at least 15 days’ prior written notice thereof to the
Administrative Agent (or such shorter time as the Administrative Agent shall determine in its sole discretion).

 

(s)          Other
Requested Information. Promptly following any request therefor, such other information regarding the operations, business affairs
and financial condition of the Borrower or any Subsidiary, or compliance with the terms of the Loan Documents, as the Administrative
Agent or any Lender may reasonably request.

 

Section 5.2           Notices
of Material Events. The Borrower shall furnish to the Administrative Agent and each Lender written notice of the following:

 

(a)          as
soon as possible and in any event within three days after the Borrower or any other Loan Party obtains knowledge thereof, the occurrence
of any Default;

 

(b)          as
soon as possible and in any event within three days after the Borrower or any other Loan Party obtains knowledge thereof, the filing
or commencement of any action, suit or proceeding by or before any arbitrator or Governmental Authority against or affecting the
Borrower or any Affiliate thereof that, if adversely determined, could reasonably be expected to result in a Material Adverse Effect;

 

(c)          promptly
upon the Borrower or any other Loan Party obtaining knowledge thereof, the occurrence of any ERISA Event that, alone or together
with any other ERISA Events that have occurred, could reasonably be expected to result in liability of the Borrower and its Subsidiaries
in an aggregate amount exceeding $5,000,000;

 

(d)          promptly
after the furnishing thereof, copies of any statement or report furnished pursuant to the terms of any preferred stock designation,
indenture, loan or credit or similar agreement and not otherwise required to be furnished to the Lenders pursuant to Section 5.1
or any other clause of this Section 5.2;

 

(e)          promptly,
and in any event within five Business Days after receipt thereof by any Loan Party or any Subsidiary thereof, copies of each notice
or other correspondence received from the SEC (or comparable agency in any applicable non-U.S. jurisdiction) concerning any investigation
or possible investigation or other inquiry by such agency regarding financial or other operational results of any Loan Party or
any Subsidiary thereof;

 

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(f)          promptly,
all title or other information received after the Effective Date by any Loan Party which discloses any material defect in the title
to any material asset included in the Borrowing Base;

 

(g)          promptly
upon the Borrower or any other Loan Party obtaining knowledge thereof, any other development that results in, or could reasonably
be expected to result in, a Material Adverse Effect; and

 

(h)          promptly,
the identifying name, number and depositary regarding each deposit account established after the Effective Date.

 

Each notice delivered under this Section shall be accompanied
by a statement of a Responsible Officer setting forth the details of the event or development requiring such notice and any action
taken or proposed to be taken with respect thereto.

 

Section 5.3           Existence;
Conduct of Business. The Borrower shall, and shall cause each Loan Party to, do or cause to be done all things necessary to
preserve, renew and keep in full force and effect its legal existence and the rights, privileges and franchises necessary in the
conduct of its business; provided that the foregoing shall not prohibit any merger, consolidation, liquidation or dissolution
permitted under Section 6.4.

 

Section 5.4           Payment
of Obligations. The Borrower shall, and shall cause each Loan Party to, pay its obligations, including Tax liabilities, that,
if not paid, could result in a Material Adverse Effect before the same shall become delinquent or in default, except where (a)
the validity or amount thereof is being contested in good faith by appropriate proceedings, (b) the Borrower or such Loan Party
has set aside on its books adequate reserves with respect thereto in accordance with GAAP and (c) the failure to make such payment
pending such contest could not reasonably be expected to have a Material Adverse Effect.

 

Section 5.5           Insurance.
The Borrower shall, and shall cause each Loan Party to, maintain, with financially sound and reputable insurance companies, not
Affiliates of the Borrower, insurance in such amounts and against such risks as are customarily maintained by companies engaged
in the same or similar businesses operating in the same or similar locations. The Borrower shall cause each issuer of an insurance
policy to provide the Administrative Agent with an endorsement (a) showing the Administrative Agent as loss payee with respect
to each policy of property or casualty insurance and naming the Administrative Agent and each Lender as an additional insured with
respect to each policy of liability insurance, (b) providing that 30 days’ notice shall be given to the Administrative Agent
prior to any cancellation of, material reduction or change in coverage provided by or other material modification to such policy
and (c) reasonably acceptable in all other respects to the Administrative Agent. The Borrower shall execute and deliver to the
Administrative Agent a collateral assignment, in form and substance satisfactory to the Administrative Agent, of each business
interruption insurance policy maintained by the Borrower.

 

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Section 5.6           Books
and Records; Inspection Rights. The Borrower shall, and shall cause each Loan Party to, keep proper books of record and account
in which full, true and correct entries are made of all dealings and transactions in relation to its business and activities. The
Borrower shall, and shall cause each Loan Party to, permit any representatives designated by the Administrative Agent or any Lender,
upon reasonable prior notice, to visit and inspect its properties, to examine and make extracts from its books and records, and
to discuss its affairs, finances and condition with its officers and independent accountants, all at such reasonable times and
as often as reasonably requested; provided, that when a Default exists the Administrative Agent or any Lender (or any of
their respective representatives) may do any of the foregoing at the expense of the Borrower at any time during normal business
hours and without advance notice. All such inspections or audits by the Administrative Agent shall be at the Borrower’s expense.
The Borrower hereby authorizes and instructs its independent accountants to discuss the Borrower’s affairs, finances and
condition with the Administrative Agent and any Lender, at the Administrative Agent’s or such Lender’s request.

 

Section 5.7           Compliance
with Laws. The Borrower shall, and shall cause each Loan Party to, comply with Applicable Law except where the failure to comply
could not reasonably be expected to have a Material Adverse Effect.

 

Section 5.8           Use
of Proceeds and Letters of Credit. The proceeds of the Loans shall be used only for (a) the repayment and termination of Debt
to be Repaid, (b) the acquisition and development by the Borrower and its Restricted Subsidiaries of Oil and Gas Properties; and
(c) other general corporate purposes of the Borrower and its Restricted Subsidiaries. No part of the proceeds of any Loan or Letter
of Credit shall be used, whether directly or indirectly, for any purpose that entails a violation of any Regulation of the FRB,
including Regulations T, U and X. Letters of Credit shall be issued only to support the Borrower and its Restricted Subsidiaries.

 

Section 5.9           Further
Assurances. (a) The Borrower shall promptly take, and cause each other Loan Party to promptly take, such actions as are necessary
or as the Administrative Agent or the Majority Lenders may reasonably request from time to time to ensure that the Secured Obligations
are secured by the Required Engineered Value of the Oil and Gas Properties of the Borrower and its Domestic Subsidiaries, substantially
all of the other assets of the Borrower and each Domestic Subsidiary (as well as all Equity Interests of each Domestic Subsidiary
and 65% of all Equity Interests of each Foreign Subsidiary that is owned by either the Borrower or a Domestic Subsidiary) and guaranteed
by each Domestic Subsidiary (including, upon the acquisition or creation thereof, any Restricted Subsidiary acquired or created
after the Effective Date), in each case as the Administrative Agent may determine, including (i) the execution and delivery of
guaranties, security agreements, pledge agreements, mortgages, financing statements and other documents, and the filing or recording
of any of the foregoing and (ii) the delivery of certificated securities and other Collateral with respect to which perfection
is obtained by possession.

 

(b)          In
connection with each redetermination of the Borrowing Base, the Borrower shall review the Reserve Report and the list of current
Mortgaged Properties (as described in Section 5.13(c)(vi)) to ascertain whether the Mortgaged Properties represent
at least the Required Engineered Value of the Oil and Gas Properties evaluated in the most recently completed Reserve Report after
giving effect to exploration and production activities, acquisitions, dispositions and production. In the event that the Mortgaged
Properties do not represent at least such Required Engineered Value, then the Borrower shall, and shall cause its Restricted Subsidiaries
to, promptly grant to the Administrative Agent as security for the Obligations a first-priority Lien interest (subject only to
Liens permitted by Section 6.3) on additional Oil and Gas Properties not already subject to a Lien of the Security Documents
such that after giving effect thereto, the Mortgaged Properties will represent at least such Required Engineered Value. All such
Liens will be created and perfected by and in accordance with the provisions of deeds of trust, security agreements and financing
statements or other Security Documents, all in form and substance reasonably satisfactory to the Administrative Agent and in sufficient
executed (and acknowledged where necessary or appropriate) counterparts for recording purposes. In order to comply with the foregoing,
if any Restricted Subsidiary places a Lien on its Oil and Gas Properties and such Subsidiary is not a Guarantor, then it shall
become a Guarantor and comply with Section 5.9(a).

 

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(c)          If
any additional Domestic Subsidiary is formed or acquired (or an Unrestricted Subsidiary is designated as a Restricted Subsidiary)
after the Effective Date, the Borrower shall, within 15 days (or such longer period as the Administrative Agent may agree)
after such newly formed or acquired Subsidiary is formed or acquired (or is designated as a Restricted Subsidiary), (i) notify
the Administrative Agent thereof, and (ii) cause, or shall cause such Subsidiary to, (A) execute and deliver a supplement
to the Guaranty and Collateral Agreement executed by such Subsidiary, (B) pledge all of the Equity Interests of such Subsidiary
(including, without limitation, delivery of original stock certificates evidencing the Equity Interests of such Subsidiary, together
with an appropriate undated stock power for each certificate duly executed in blank by the registered owner thereof, if applicable)
and (C) execute and deliver such other additional closing documents, certificates and legal opinions as shall reasonably be requested
by the Administrative Agent.

 

(d)          The
Borrower agrees to deliver promptly, if requested by the Administrative Agent (i) after receiving a request by the Borrower
to mortgage Oil and Gas Properties to the extent required by Section 5.9(b) or (ii) in the event that a new Loan Party
is formed, acquired or otherwise becomes party to any Loan Document, favorable opinions from legal counsel acceptable to the Administrative
Agent with respect to any Collateral confirming that such Collateral is subject to Security Documents securing Obligations that
constitute and create legal, valid and duly perfected Liens in such properties and interests and the proceeds thereof, and covering
such other matters as the Administrative Agent may request in good faith.

 

Section 5.10         Reserved.

 

Section 5.11         Environmental
Matters.

 

(a)          The
Borrower shall at its sole expense (including such contribution from third parties as may be available): (i) comply, and shall
cause its Properties and operations and each Restricted Subsidiary and each Restricted Subsidiary’s Properties and operations
to comply, with all applicable Environmental Laws, the breach of which could be reasonably expected to have a Material Adverse
Effect; (ii) not dispose of or otherwise release, and shall cause each Subsidiary not to dispose of or otherwise release, any oil,
oil and gas waste, hazardous substance, or solid waste on, under, about or from any of the Borrower’s or its Restricted Subsidiaries’
Properties or any other Property to the extent caused by the Borrower’s or any of its Restricted Subsidiaries’ operations
except in compliance with applicable Environmental Laws, the disposal or release of which could reasonably be expected to have
a Material Adverse Effect; (iii) timely obtain or file, and shall cause each Restricted Subsidiary to timely obtain or file, all
notices, permits, licenses, exemptions, approvals, registrations or other authorizations, if any, required under applicable Environmental
Laws to be obtained or filed in connection with the operation or use of the Borrower’s or its Restricted Subsidiaries’
Properties, which failure to obtain or file could reasonably be expected to have a Material Adverse Effect; (iv) promptly commence
and diligently prosecute to completion, and shall cause each Restricted Subsidiary to promptly commence and diligently prosecute
to completion, in the case of operated properties and use reasonable efforts to cause to be commence and diligently prosecuted
to completion in the case of third party operated properties, any assessment, evaluation, investigation, monitoring, containment,
cleanup, removal, repair, restoration, remediation or other remedial obligations (collectively, the “Remedial Work”)
in the event any Remedial Work is required or reasonably necessary under applicable Environmental Laws because of or in connection
with the actual or suspected past, present or future disposal or other release of any oil, oil and gas waste, hazardous substance
or solid waste on, under, about or from any of the Borrower’s or its Restricted Subsidiaries’ Properties, which failure
to commence and diligently prosecute to completion could reasonably be expected to have a Material Adverse effect; and (v) establish
and implement, and shall cause each Restricted Subsidiary to establish and implement, such reasonable policies of environmental
audit and compliance as may be reasonably necessary to continuously determine and assure that the Borrower’s and its Restricted
Subsidiaries’ obligations under this Section 5.11(a) are timely and fully satisfied, which failure to establish
and implement could reasonably be expected to have a Material Adverse Effect.

 

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(b)          The
Borrower will promptly, but in any event within five Business Days thereof, notify the Administrative Agent and the Lenders in
writing of any threatened action, investigation or inquiry by any Governmental Authority or any threatened demand or lawsuit by
any landowner or other third party against the Borrower or its Restricted Subsidiaries or their Properties of which the Borrower
has knowledge in connection with any Environmental Laws (excluding routine testing and corrective action) if the Borrower reasonably
anticipates that such action will result in liability (whether individually or in the aggregate) in excess of $1,000,000, not fully
covered by insurance, subject to normal deductibles.

 

(c)          The
Borrower will, and will cause each Restricted Subsidiary to, provide such environmental audits, studies and tests as may be reasonably
requested by the Administrative Agent and the Lenders, in connection with any future acquisitions of material Oil and Gas Properties
or other material Properties.

 

Section 5.12         Operation
and Maintenance of Properties. The Borrower, at its own expense, will, and will cause each Restricted Subsidiary to:

 

(a)          operate
its Oil and Gas Properties and other material Properties or cause such Oil and Gas Properties and other material Properties to
be operated in a careful and efficient manner in accordance with the practices of the industry and in compliance with all applicable
contracts and agreements and in compliance with all Applicable Laws, including, without limitation, applicable pro ration requirements
and Environmental Laws, and all applicable laws, rules and regulations of every other Governmental Authority from time to time
constituted to regulate the development and operation of its Oil and Gas Properties and the production and sale of Hydrocarbons
and other minerals therefrom, except, in each case, where the failure to comply could not reasonably be expected to have a Material
Adverse Effect.

 

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(b)          keep
and maintain all Property necessary to the conduct of its business in good working order and condition, ordinary wear and tear
excepted preserve, maintain and keep in good repair, working order and efficiency (ordinary wear and tear excepted) all of its
material Oil and Gas Properties and other Properties necessary to the conduct of its business, including, without limitation, all
equipment, machinery and facilities.

 

(c)          promptly
pay and discharge, or make reasonable and customary efforts to cause to be paid and discharged, all delay rentals, royalties, expenses
and indebtedness accruing under the leases or other agreements affecting or pertaining to its material Oil and Gas Properties and
will do all other things necessary to keep unimpaired their rights with respect thereto and prevent any forfeiture thereof or default
thereunder, provided, however, that Borrower may allow to terminate by its terms any oil and gas lease (whether at
the end of its primary term or otherwise) that does not cover any proved reserves.

 

(d)          promptly
perform or make reasonable and customary efforts to cause to be performed, in accordance with industry standards, the obligations
required by each and all of the assignments, deeds, leases, sub-leases, contracts and agreements affecting its interests in its
Oil and Gas Properties and other material Properties.

 

(e)          operate
its Oil and Gas Properties and other material Properties or cause or make reasonable and customary efforts to cause such Oil and
Gas Properties and other material Properties to be operated in accordance with the practices of the industry and in material compliance
with all applicable contracts and agreements and in compliance with all Applicable Laws except where the failure to comply could
not reasonably be expected to have a Material Adverse Effect.

 

(f)          to
the extent the Borrower is not the operator of any Property, the Borrower shall use reasonable efforts to cause the operator to
comply with this Section 5.12.

 

Section 5.13         Reserve
Reports.

 

(a)          On
or before March 1st and September 1st of each year, the Borrower shall furnish to the Administrative Agent and the Lenders
a Reserve Report evaluating the Oil and Gas Properties of the Borrower and its Restricted Subsidiaries as of the immediately preceding
December 31st and June 30th. The Reserve Report as of December 31st of each year shall be prepared by one or more Approved
Petroleum Engineers, and the June 30th Reserve Report of each year, shall be prepared by or under the supervision of
the chief engineer of the Borrower and reviewed by one or more Approved Petroleum Engineers and otherwise in a manner consistent
with the preceding December 31st Reserve Report. Each Reserve Report prepared by or under the supervision of the chief engineer
of the Borrower shall be certified by the chief engineer to be true and accurate in all material respects and to have been prepared
in accordance with the procedures used in the immediately preceding December 31st Reserve Report.

 

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(b)          In
the event of an Interim Redetermination, the Borrower shall furnish to the Administrative Agent and the Lenders a Reserve Report
prepared by or under the supervision of the chief engineer of the Borrower who shall certify such Reserve Report to be true and
accurate in all material respects and to have been prepared in accordance with the procedures used in the immediately preceding
December 31st Reserve Report. For any Interim Redetermination requested by the Administrative Agent or the Borrower pursuant
to Section 2.4(b), the Borrower shall provide such Reserve Report with an “as of” date as required by the
Administrative Agent as soon as possible, but in any event no later than 45 days following the receipt of such request.

 

(c)          With
the delivery of each Reserve Report, the Borrower shall provide to the Administrative Agent and the Lenders a certificate from
a Responsible Officer certifying that in all material respects: (i) the information contained in the Reserve Report and any other
information delivered in connection therewith is true and correct in all material respects, (ii) the Borrower or its Restricted
Subsidiaries owns good and defensible title to the Oil and Gas Properties evaluated in such Reserve Report (except any such Oil
and Gas Properties that have been disposed of since the date of such Reserve Report as permitted by this Agreement) and such Properties
are free of all Liens except as permitted by Section 6.3, (iii) except as set forth on an exhibit to the certificate,
on a net basis there are no gas imbalances, take or pay or other prepayments in excess of the volume specified in Section 3.24
with respect to its Oil and Gas Properties evaluated in such Reserve Report which would require the Borrower or any Restricted
Subsidiary to deliver Hydrocarbons either generally or produced from such Oil and Gas Properties at some future time without then
or thereafter receiving full payment therefor, (iv) none of their Oil and Gas Properties have been sold since the date of the last
Borrowing Base determination except as set forth on an exhibit to the certificate, which certificate shall list all of its Oil
and Gas Properties sold and in such detail as reasonably required by the Administrative Agent, (v) attached to the certificate
is a list of all marketing agreements entered into subsequent to the later of the date hereof or the most recently delivered Reserve
Report which the Borrower could reasonably be expected to have been obligated to list on Schedule 3.25 had such agreement
been in effect on the date hereof and (vi) attached to the certificate is a schedule of the Oil and Gas Properties evaluated by
such Reserve Report that are Mortgaged Properties and demonstrating the percentage of the PV-9 Value of such Oil and Gas Properties
that the value of such Mortgaged Properties represents.

 

Section 5.14         Title
Information.

 

(a)          On
or before the delivery to the Administrative Agent and the Lenders of each Reserve Report required by Section 5.13(a),
the Borrower will deliver title information in form and substance reasonably acceptable to the Administrative Agent covering enough
of the Oil and Gas Properties evaluated by such Reserve Report that were not included in the immediately preceding Reserve Report,
so that the Administrative Agent shall have received together with title information previously delivered to the Administrative
Agent, reasonably satisfactory title information on the Required Engineered Value of the Oil and Gas Properties evaluated by such
Reserve Report.

 

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(b)          If
the Borrower has provided title information for additional Properties under Section 5.14(a), the Borrower shall, within
60 days of notice from the Administrative Agent that title defects or exceptions exist with respect to such additional Properties,
either (i) cure any such title defects or exceptions (including defects or exceptions as to priority) which are not permitted by
Section 6.3 raised by such information, (ii) substitute acceptable Mortgaged Properties (with no title defects or exceptions
except for Liens permitted by Section 6.3) having an equivalent value or (iii) deliver title information in form and substance
reasonably acceptable to the Administrative Agent so that the Administrative Agent shall have received, together with title information
previously delivered to the Administrative Agent, reasonably satisfactory title information on the Required Engineered Value of
Oil and Gas Properties evaluated by such Reserve Report.

 

(c)          If
the Borrower is unable to cure any title defect requested by the Administrative Agent or the Lenders to be cured within the 60-day
period or the Borrower does not comply with the requirements to provide acceptable title information covering the Oil and Gas Properties
evaluated in the most recent Reserve Report, such default shall not be a Default, but instead the Administrative Agent and/or the
Required Lenders shall have the right to exercise the following remedy in their sole discretion from time to time, and any failure
to so exercise this remedy at any time shall not be a waiver as to future exercise of the remedy by the Administrative Agent or
the Lenders. To the extent that the Administrative Agent or the Required Lenders are not satisfied with title to any Mortgaged
Property after the 60-day period has elapsed, such unacceptable Mortgaged Property shall not count towards the requirement, and
the Administrative Agent may send a notice to the Borrower and the Lenders that the then outstanding Borrowing Base shall be reduced
by an amount as determined by the Required Lenders to cause the Borrower to be in compliance with the requirement to provide acceptable
title information on the Oil and Gas Properties. This new Borrowing Base shall become effective immediately after receipt of such
notice.

 

Section 5.15         Unrestricted
Subsidiaries. The Borrower:

 

(a)          will
cause the management, business and affairs of each of Borrower and its Subsidiaries to be conducted in such a manner (including,
without limitation, by keeping separate books of account, maintaining separate policies of insurance and by not permitting Properties
of Borrower and its respective Subsidiaries to be commingled) so that each Unrestricted Subsidiary will be treated as an entity
separate and distinct from Borrower and the Restricted Subsidiaries (except (i) with respect to the treatment for tax purposes
of the Borrower or any Restricted Subsidiary holding any interest in an Unrestricted Subsidiary that is regarded as a partnership
and (ii) for the common management/directorship between the Borrower and any Unrestricted Subsidiary);

 

(b)          will
not, and will not permit any of the Restricted Subsidiaries to, incur, assume or suffer to exist any Guarantee by Borrower or such
Restricted Subsidiary of, or be or become liable for any Indebtedness of any Unrestricted Subsidiary;

 

(c)          will
not permit any Unrestricted Subsidiary to hold any Equity Interest in, or any Indebtedness of, the Borrower or any Restricted Subsidiary;

 

(d)          will
not permit any Unrestricted Subsidiary to have any Indebtedness other than Non-Recourse Debt;

 

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(e)          will
not permit any Unrestricted Subsidiary to be a party to any agreement, contract, arrangement or understanding with the Borrower
or any Restricted Subsidiary of the Borrower unless the terms of any such agreement, contract, arrangement or understanding are
no less favorable to the Borrower or such Restricted Subsidiary than those that might be obtained at the time from Persons who
are not Affiliates of the Borrower;

 

(f)          will
not, nor will it permit any of its Restricted Subsidiaries to, have any direct or indirect obligation (i) to subscribe for additional
Equity Interests of such Unrestricted Subsidiary or (ii) to maintain or preserve such Unrestricted Subsidiary’s financial
condition or to cause such Unrestricted Subsidiary to achieve any specified levels of operating results; and

 

(g)          will
not permit any Unrestricted Subsidiary to Guarantee or otherwise directly or indirectly provide credit support for any Indebtedness
of the Borrower or any of its Restricted Subsidiaries.

 

Section 5.16         Keepwell.
The Borrower hereby absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed
from time to time by each other Loan Party to honor all of its obligations under each Loan Document or any Lender Provided Hedging
Agreement in respect of Hedging Obligations (provided, however, that the Borrower shall only be liable under this
Section 5.16 for the maximum amount of such liability that can be hereby incurred without rendering its obligations
under this Section 5.16 or otherwise under this Agreement voidable under applicable law relating to fraudulent conveyance
or fraudulent transfer, and not for any greater amount). The obligations of the Borrower under this Section 5.16 shall
remain in full force and effect until all Obligations have been repaid in full. Each Guarantor intends that this Section 5.16
constitute, and this Section 5.16 shall be deemed to constitute, a “keepwell, support, or other agreement”
for the benefit of each other Loan Party for all purposes of section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

 

Section 5.17         Cash
Management. The Borrower shall, and shall cause its Restricted Subsidiaries to:

 

(a)          subject
to Section 5.18, maintain all cash management and treasury business with SunTrust Bank or a Permitted Third Party Bank,
including, without limitation, all deposit accounts, disbursement accounts, investment accounts and lockbox accounts (other than
zero-balance accounts for the purpose of managing local disbursements, payroll, withholding and other fiduciary accounts, all of
which the Loan Parties may maintain without restriction) (each such deposit account, disbursement account, investment account and
lockbox account, a “Controlled Account”); each Controlled Account shall be a cash collateral account, with all
cash, checks and other similar items of payment in such account securing payment of the Secured Obligations, and in which the Borrower
and each of its Restricted Subsidiaries shall have granted a first priority Lien to the Administrative Agent, perfected either
automatically under the UCC (with respect to Controlled Accounts at SunTrust Bank) or subject to Control Account Agreements;

 

(b)          deposit
promptly, and in any event no later than 10 Business Days after the date of receipt thereof, all cash, checks, drafts or other
similar items of payment relating to or constituting payments made in respect of any and all accounts and other Collateral into
Controlled Accounts, in each case except for cash and Cash Equivalent Investments the aggregate value of which does not exceed
$100,000 at any time; and

 

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(c)          at
any time after the occurrence and during the continuance of an Event of Default, at the request of the Required Lenders, the Borrower
will, and will cause each other Loan Party to, cause all payments constituting proceeds of accounts or other Collateral to be directed
into lockbox accounts under agreements in form and substance satisfactory to the Administrative Agent.

 

Section 5.18         Post-Closing
Conditions. The Borrower shall, and shall cause its Restricted Subsidiaries to:

 

(a)          prior
to December 31, 2014, (or as extended in the Administrative Agent’s sole discretion), dissolve EERG Energy ULC and AEE Canada
Inc. and provide the Administrative Agent evidence, reasonably satisfactory to the Administrative Agent, of such dissolution;

 

(b)          within
30 days after the Effective Date, deliver to the Administrative Agent Control Account Agreements, duly executed by each Permitted
Third Party Bank and the applicable Loan Party; and

 

(c)          within
30 days after the Effective Date, deliver to the Administrative Agent original share certificates evidencing the Borrower’s
and its Restricted Subsidiaries’ ownership in Powder Mountain Energy Ltd., together with undated stock powers duly executed
in blank.

 

ARTICLE
VI

Negative Covenants

 

The Borrower covenants and agrees with the
Administrative Agent, the Issuing Banks and the Lenders that, until the Termination Date:

 

Section 6.1           Financial
Covenants.

 

(a)          Ratio
of Total Debt to EBITDAX. The Borrower will not, as of the last day of any fiscal quarter, permit its ratio of Total Debt of
the Borrower and the Restricted Subsidiaries as of such day to EBITDAX for the four fiscal quarters ending on the last day of the
fiscal quarter immediately preceding such date of determination for which financial statements are available to be greater than
4.0 to 1.0.

 

(b)          Current
Ratio. The Borrower will not permit, as of the last day of any fiscal quarter, the ratio of (i) consolidated current assets
of the Borrower and the Restricted Subsidiaries (including the unused amount of the total Commitments, but excluding non-cash assets
under ASC Topic 815, formerly FAS 133) to (ii) consolidated current liabilities of the Borrower and the Restricted Subsidiaries
(excluding non-cash obligations under ASC Topic 815, formerly FAS 133, that may be classified as current liabilities and current
maturities under this Agreement and the Permitted Secured Notes Agreement) to be less than 1.0 to 1.0.

 

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Section 6.2           Indebtedness.
The Borrower shall not, and shall not permit any Restricted Subsidiary to, create, incur, assume or permit to exist any Indebtedness,
except:

 

(a)          Indebtedness
created under the Loan Documents;

 

(b)          Indebtedness
existing on the date hereof and set forth in Schedule 6.2 (which schedule shall not include Indebtedness described
in Section 6.2(k)) and extensions, renewals and replacements of any such Indebtedness that do not increase the outstanding
principal amount thereof except by an amount equal to a reasonable premium or other amount paid, and reasonable fees and expenses
incurred, in connection with such extension, renewal or replacement or change any direct or contingent obligor with respect thereto
or shorten the average life to maturity thereof;

 

(c)          Indebtedness
of the Borrower to any Restricted Subsidiary and of any Wholly Owned Subsidiary Guarantor to the Borrower or any other Restricted
Subsidiary; provided that such Indebtedness is not held, assigned, transferred, negotiated or pledged to any Person other
than the Borrower or a Wholly-Owned Subsidiary Guarantor; and provided further, that any such Indebtedness owed by
either the Borrower or a Wholly-Owned Subsidiary Guarantor shall be subordinated to the Obligations on terms set forth in the Guarantee
and Collateral Agreement;

 

(d)          Guarantees
by the Borrower of Indebtedness otherwise permitted hereunder of any Restricted Subsidiary and by any Restricted Subsidiary of
Indebtedness otherwise permitted hereunder of the Borrower or any other Restricted Subsidiary (provided that only Guarantors
may guarantee Indebtedness described in Section 6.2(k));

 

(e)          Indebtedness
of the Borrower or any Restricted Subsidiary incurred to finance the acquisition, construction or improvement of any fixed or capital
assets, including Capital Lease Obligations and any Indebtedness assumed in connection with the acquisition of any such assets
or secured by a Lien on any such assets prior to the acquisition thereof, and extensions, renewals and replacements of any such
Indebtedness that do not increase the outstanding principal amount thereof; provided that (i) such Indebtedness is incurred
prior to or within 90 days after such acquisition or the completion of such construction or improvement and (ii) the aggregate
principal amount of Indebtedness permitted by this clause (e) shall not exceed $5,000,000 at any time outstanding;

 

(f)          Indebtedness
of the Borrower or any Restricted Subsidiary as an account party in respect of trade letters of credit and Indebtedness associated
with bonds or surety obligations required by Governmental Requirements in connection with the operation of the Oil and Gas Properties;

 

(g)          obligations
(contingent or otherwise) of the Borrower or any Restricted Subsidiary existing or arising under any Hedging Agreement permitted
under Section 6.18;

 

(h)          the
Debt to be Repaid (so long as such Indebtedness is repaid on the Effective Date);

 

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(i)          contingent
liabilities arising with respect to customary indemnification obligations in favor of sellers in connection with acquisitions permitted
by this Agreement and purchasers in connection with Dispositions permitted under Section 6.5;

 

(j)          other
unsecured Indebtedness in an aggregate principal amount not exceeding $2,500,000 at any time outstanding;

 

(k)          Permitted
Secured Debt of the Borrower in the principal amount not in excess of $175,000,000 issued on a one time basis on August 27, 2014
and any guarantees of the Guarantors thereof; provided that (i) the Borrower shall have furnished to the Administrative
Agent and the Lenders copies of the final executed versions of the definitive documents therefor, (ii) such Permitted Secured Debt
shall be subject to the Intercreditor Agreement and (iii) the terms and conditions of the Permitted Secured Notes Documents are
satisfactory to the Administrative Agent and the Majority Lenders; for purposes of clarification, it is agreed and understood that
Permitted Secured Debt incurred under this Section 6.2(k) which is repaid may not be reborrowed under this Section 6.2(k);
and

 

(l)          Permitted
Refinancing Debt, the proceeds of which shall be used concurrently with the incurrence thereof to refinance the outstanding Permitted
Secured Debt permitted under Section 6.2(k); provided that (i) the Borrower shall have furnished to the Administrative
Agent and the Lenders copies of the final executed versions of the definitive documents therefor, (ii) at the time of incurring
such Permitted Refinancing Debt (A) no Default has occurred and is then continuing, and (B) no Default would result from the incurrence
of such Permitted Refinancing Debt after giving effect to the incurrence of such Permitted Refinancing Debt (and any concurrent
repayment of Permitted Debt with the proceeds of such incurrence).

 

Notwithstanding anything in this Section 6.2 to
the contrary, in no event shall the Borrower or any Restricted Subsidiary incur any Indebtedness otherwise permitted pursuant to
this Section 6.2 (other than as permitted by Section 6.2(l)) if the proceeds of such incurrence would be used to
refinance, replace, collateralize or Redeem any Permitted Secured Debt.

 

Section 6.3           Liens.
The Borrower shall not, and shall not permit any Restricted Subsidiary to, create, incur, assume or permit to exist any Lien on
any property or asset now owned or hereafter acquired by it, or assign or sell any income or revenues (including accounts receivable)
or rights in respect of any thereof, except:

 

(a)          Liens
pursuant to any Loan Document;

 

(b)          Permitted
Encumbrances;

 

(c)          any
Lien on any property or asset of the Borrower or any Restricted Subsidiary existing on the date hereof and set forth in Schedule 6.3
(excluding Liens permitted by Section 6.3(f)); provided that (i) such Lien shall not apply to any other property
or asset of the Borrower or any Restricted Subsidiary and (ii) such Lien shall secure only those obligations of the Borrower or
any Restricted Subsidiary which it secures on the date hereof and extensions, renewals and replacements thereof that do not increase
the outstanding principal amount thereof;

 

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(d)          Liens
on fixed or capital assets acquired, constructed or improved by the Borrower or any Restricted Subsidiary; provided that
(i) such security interests secure Indebtedness permitted by clause (e) of Section 6.2, (ii) such
security interests and the Indebtedness secured thereby are incurred prior to or within 90 days after such acquisition or
the completion of such construction or improvement, (iii) the Indebtedness secured thereby does not exceed the cost or fair
market value, whichever is lower, of the fixed or capital assets being acquired, constructed or improved and (iv) such security
interests shall not apply to any other property or assets of the Borrower or any Restricted Subsidiary;

 

(e)          Liens
and rights of setoff of banks and securities intermediaries in respect of deposit accounts and securities accounts maintained in
the ordinary course of business; and

 

(f)          Liens
securing Permitted Secured Debt and Permitted Refinancing Debt incurred pursuant to Sections 6.2(k) and (l),
respectively; provided, however, that (i) such Liens, if any, securing such Indebtedness are subordinate to the Liens
securing the Obligations, this Agreement and the other Loan Documents pursuant to the Intercreditor Agreement and (ii) both before
and after giving effect to the incurrence of any such Lien, (1) the Borrower has, or has caused its Subsidiaries to, first grant
to the Administrative Agent to secure the Obligations a prior Lien on the same Property pursuant to Security Documents in form
and substance satisfactory to the Administrative Agent to the extent a prior Lien has not already been granted to the Administrative
Agent on such Property (and in connection therewith, the Borrower shall, or shall cause its Subsidiaries to, execute and deliver
such other additional closing documents, certificates and legal opinions as shall reasonably be requested by the Administrative
Agent); and (2) the Borrower is in compliance with the Intercreditor Agreement.

 

Section 6.4           Fundamental
Changes. The Borrower shall not, and shall not permit any Restricted Subsidiary to, merge into or consolidate with any other
Person, or permit any other Person to merge into or consolidate with it, or sell, transfer, lease or otherwise dispose of (in one
transaction or in a series of transactions) all or substantially all of its assets, or all or substantially all of the Equity Interests
of any Restricted Subsidiary (in each case, whether now owned or hereafter acquired), or liquidate or dissolve, or purchase or
otherwise acquire all or substantially all of the assets or any Equity Interests of any class of, or any partnership or joint venture
interest in, any other Person, or permit any Restricted Subsidiary to issue any Equity Interests, except that, if at the time thereof
and immediately after giving effect thereto no Default shall have occurred and be continuing (i) any Restricted Subsidiary
may merge into the Borrower in a transaction in which the Borrower is the surviving corporation, (ii) any Restricted Subsidiary
may merge into any Restricted Subsidiary in a transaction in which the surviving entity is a Wholly Owned Subsidiary Guarantor,
(iii) any Restricted Subsidiary may sell, transfer, lease or otherwise dispose of its assets to, or issue Equity Interests to,
the Borrower or to a Wholly Owned Subsidiary Guarantor, (iv) any Restricted Subsidiary may liquidate or dissolve if the Borrower
determines in good faith that such liquidation or dissolution is in the best interests of the Borrower and is not materially disadvantageous
to the Lenders, (v) the Borrower or any Restricted Subsidiary may make any Investment permitted by Section 6.6, and
(vi) the Borrower or any Restricted Subsidiary may make any Disposition permitted by Section 6.5.

 

Section 6.5           Sale
of Properties. The Borrower will not, and will not permit any Restricted Subsidiary to, Dispose any Property except for:

 

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(a)          the
sale of Hydrocarbons in the ordinary course of business;

 

(b)          farmouts
of undeveloped acreage and assignments in connection with such farmouts;

 

(c)          the
sale or transfer of equipment that is no longer necessary for the business of the Borrower or such Restricted Subsidiary or is
replaced by equipment of at least comparable value and use;

 

(d)          if
no Default or Event of Default exists either before or after giving effect to such Disposition, the Disposition of any Oil and
Gas Property or any interest therein or any Restricted Subsidiary owning Oil and Gas Properties; provided that (i) 85% of
the consideration received in respect of such Disposition shall be cash or Cash Equivalent Investments, or Oil and Gas Properties;
(ii) any non-cash consideration received (to the extent constituting an Investment) is permitted by Section 6.6; (iii) the
consideration received in respect of such Disposition shall be equal to or greater than the fair market value of the Oil and Gas
Property, interest therein or Restricted Subsidiary subject of such Disposition (as reasonably determined by the board of directors
of the Borrower and, if requested by the Administrative Agent, the Borrower shall deliver a certificate of a Responsible Officer
of the Borrower certifying to that effect); (iv) (A) if such Disposition of Oil and Gas Property or Restricted Subsidiary owning
Oil and Gas Properties included in the most recently delivered Reserve Report during any period between two successive Scheduled
Redetermination Dates (or, in the case of any such event occurring prior to October 1, 2014, the period from the Effective
Date to October 1, 2014) has an PV-9 Value that, when aggregated with the Hedging Termination Value of all Hedge Liquidations
during such period, will exceed five percent or greater, the Borrowing Base may be redetermined pursuant to Section 2.4(f)
or (h), as applicable; (v) prior to or contemporaneously therewith, the Borrower shall have prepaid the Loans to the extent
required under Section 2.10(c), (vi) if any such Disposition is of a Restricted Subsidiary owning Oil and Gas Properties,
such Disposition shall include all the Equity Interests of such Restricted Subsidiary; and (vii) both before and after giving effect
to such Disposition, the Borrower shall be in pro forma compliance with Section 6.1 (and the Borrower shall deliver to the
Administrative Agent concurrently therewith a certificate of a Financial Officer setting forth reasonably detailed calculations
demonstrating pro forma compliance with Section 6.1);

 

(e)          Dispositions
among the Borrower and its Wholly Owned Subsidiary Guarantors; provided that both before and after giving effect to such
Disposition, (i) no Default or Event of Default exists or would exist and (ii) the Borrower and the Restricted Subsidiaries are
in compliance with Section 5.9(c) as of the date of such Disposition without giving effect to the 15 day grace period specified
in such Section;

 

(f)          transactions
pursuant to the “Carry Agreement” and the “Farmout Agreement” in compliance with Section 7.10 of the Mortgages
(as such terms are defined therein); and

 

(g)          if
no Default or Event of Default exists either before or after giving effect to such Disposition, sales and other Dispositions of
Properties (other than Hydrocarbon Interests and Equity Interests) not regulated by Section 6.5(a) – (g) having
a fair market value not to exceed, in the aggregate, $2,500,000 during any 6-month period;

 

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provided, however, that any Disposition pursuant
to this Section 6.5 (other than clauses (c) and (e)) shall be for fair market value.

 

Section 6.6           Investments,
Loans, Advances, Guarantees and Acquisitions. The Borrower shall not, and shall not permit any Restricted Subsidiary to, purchase,
hold or acquire (including pursuant to any merger with any Person that was not a Wholly Owned Subsidiary prior to such merger)
any Investment, except:

 

(a)          Cash
Equivalent Investments;

 

(b)          Investments
made (i) by the Borrower in or to any existing Wholly Owned Subsidiary Guarantor and (ii) by any Restricted Subsidiary in or to
the Borrower or any existing Wholly Owned Subsidiary Guarantor;

 

(c)          Investments
of a type not otherwise described in this Section 6.6 in an aggregate amount not to exceed $2,500,000;

 

(d)          Guarantees
constituting Indebtedness permitted by Section 6.2 (provided that only Guarantors may guarantee Indebtedness
described in Section 6.2(k));

 

(e)          advances
to officers, directors and employees of the Borrower and Restricted Subsidiaries in an aggregate amount not to exceed $250,000
at any time outstanding, for travel, entertainment, relocation and analogous ordinary business purposes;

 

(f)          bank
deposits in the ordinary course of business;

 

(g)          Investments
consisting of extensions of credit in the nature of accounts receivable or notes receivable arising from the grant of trade credit
in the ordinary course of business, and Investments received in satisfaction or partial satisfaction thereof from financially troubled
account debtors to the extent reasonably necessary in order to prevent or limit loss;

 

(h)          non-cash
consideration received, to the extent permitted by the Loan Documents, in connection with the Disposition of property permitted
by this Agreement, provided that any Oil and Gas Properties received as non-cash consideration shall comply with Section
6.6(j); and any Equity Interests received as non-cash consideration shall comply with Section 6.10 and the proviso
to this Section 6.6;

 

(i)          Investments
listed on Schedule 6.6 as of the Effective Date;

 

(j)          Investments
in direct ownership interests in additional Oil and Gas Properties of the Borrower and its Restricted Subsidiaries and gas gathering
systems related thereto or related to farm-out, farm-in, joint operating, or area of mutual interest agreements, gathering systems,
pipelines or other similar arrangements which are usual and customary in the oil and gas exploration and production business located
within the United States; and

 

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(k)          Investments
made after the Effective Date in Unrestricted Subsidiaries, provided that (i) the Investment is on fair and reasonable terms
and (ii) the aggregate amount of such Investments (valued as of the date of such Investment) do not exceed an amount equal to $2,500,000;
and provided, further, that both before and after giving effect to such Investment (on a pro forma basis acceptable
to the Administrative Agent) no Default or Event of Default shall have occurred and be continuing and all representations and warranties
contained in Article III hereof shall be true and correct in all material respects as if made both immediately before
and immediately after the time of such Investment (or, if stated to have been made expressly as of an earlier date, were true and
correct as of such date);

 

provided (i) that any Investment that when made complies
with the requirements of the definition of the term “Cash Equivalent Investment” may continue to be held notwithstanding
that such Investment if made thereafter would not comply with such requirements and (ii) notwithstanding anything in this Section 6.6
or elsewhere in this Agreement to the contrary, no Investment shall be permitted in any venture or in any Unrestricted Subsidiary,
unless, such Investment does not include any Collateral (other than cash or Cash Equivalent Investments).

 

Section 6.7           Marketing
Activities. The Borrower will not, and will not permit any of its Restricted Subsidiaries to, engage in marketing activities
for any Hydrocarbons or enter into any contracts related thereto other than (a) contracts for the sale of Hydrocarbons scheduled
or reasonably estimated to be produced from their proved Oil and Gas Properties during the period of such contract, (b) contracts
for the sale of Hydrocarbons scheduled or reasonably estimated to be produced from proved Oil and Gas Properties of third parties
during the period of such contract associated with the Oil and Gas Properties of the Borrower and its Restricted Subsidiaries that
the Borrower or one of its Restricted Subsidiaries has the right to market pursuant to joint operating agreements, unitization
agreements or other similar contracts that are usual and customary in the oil and gas business and (c) other contracts for the
purchase and/or sale of Hydrocarbons of third parties (i) which have generally offsetting provisions (i.e., corresponding
pricing mechanics, delivery dates and points and volumes) such that no “position” is taken and (ii) for which appropriate
credit support has been taken to alleviate the material credit risks of the counterparty thereto.

 

Section 6.8           Restricted
Payments. The Borrower shall not, and shall not permit any Restricted Subsidiary to, declare or make, or agree to pay or make,
directly or indirectly, any Restricted Payment, except (a) the Borrower may declare and pay dividends with respect to its Equity
Interests payable solely in additional shares of its common stock, (b) Restricted Subsidiaries may declare and pay dividends ratably
with respect to their Equity Interests, and (c) in addition, the Borrower may make other Restricted Payments in an aggregate
amount not to exceed $1,000,000.

 

Section 6.9           Transactions
with Affiliates. The Borrower shall not, and shall not permit any Restricted Subsidiary to, sell, lease or otherwise transfer
any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other
transactions with, any of its Affiliates, except (a) in the ordinary course of business at prices and on terms and conditions not
less favorable to the Borrower or such Restricted Subsidiary than could be obtained on an arm’s-length basis from unrelated
third parties, (b) transactions between or among the Borrower and its Wholly Owned Subsidiaries not involving any other Affiliate,
(c) any Restricted Payment permitted by Section 6.8 and (d) as otherwise set forth on Schedule 6.9.

 

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Section 6.10         Changes
in Nature of Business. Neither the Borrower nor any Subsidiary will allow any material change to be made in the character of
its business as an independent oil and gas exploration and production company. From and after the date hereof, the Borrower and
its Subsidiaries will not acquire or make any other expenditure (whether such expenditure is capital, operating or otherwise) in
or related to, any Oil and Gas Properties not located within the United States. Notwithstanding anything herein to the contrary
and except as set forth in Schedule 6.10, in no event shall the Borrower or any Subsidiary, create, acquire or own any interest
in (a) any Subsidiary organized under the laws of any jurisdiction other than jurisdictions within the United States, (b) any foreign
joint venture or (c) any Restricted Subsidiary other than a Wholly Owned Subsidiary.

 

Section 6.11         Restrictive
Agreements. The Borrower shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, enter into,
incur or permit to exist any agreement or other arrangement that prohibits, restricts or imposes any condition upon (a) the ability
of the Borrower or any Restricted Subsidiary to create, incur or permit to exist any Lien upon any of its property in favor of
the Administrative Agent or (b) the ability of any Restricted Subsidiary to pay dividends or other distributions with respect to
any shares of its Equity Interests or to make or repay loans or advances to the Borrower or any other Restricted Subsidiary or
to Guarantee Indebtedness of the Borrower or any other Restricted Subsidiary or transfer any of its properties to any Loan Party
or (c) the ability of any Loan Party to amend or otherwise modify this Agreement or any other Loan Document; provided that
(i) the foregoing shall not apply to restrictions and conditions imposed by Applicable Law or by the Loan Documents, or by the
Permitted Secured Notes Documents (which shall permit Liens under the Permitted Secured Notes Documents in a manner consistent
with the Intercreditor Agreement) or the Intercreditor Agreement, (ii) the foregoing shall not apply to restrictions and conditions
existing on the date hereof identified on Schedule 6.11 (but shall apply to any extension or renewal of, or any amendment
or modification expanding the scope of, any such restriction or condition), (iii) the foregoing shall not apply to customary restrictions
and conditions contained in agreements relating to the sale of a Subsidiary pending such sale, provided such restrictions
and conditions apply only to the Subsidiary that is to be sold and such sale is permitted hereunder, (iv) clause (a)
of the foregoing shall not apply to restrictions or conditions imposed by any agreement relating to secured Indebtedness permitted
by this Agreement (excluding the Permitted Secured Debt) if such restrictions or conditions apply only to the property or assets
securing such Indebtedness, (v) the foregoing shall not apply to restrictions or conditions imposed by any Permitted Secured Notes
Documents in effect as of the Effective Date and (vi) clause (a) of the foregoing shall not apply to customary
provisions in leases and other contracts restricting the assignment thereof.

 

Section 6.12         Restriction
of Amendments to Organization Documents. The Borrower shall not, and shall not permit any Restricted Subsidiary to, amend or
otherwise modify, or waive any rights under, any Organization Documents if, in any case, such amendment, modification or waiver
could reasonably be expected to be adverse to the interests of the Administrative Agent, the Issuing Bank or the Lender; provided
it is acknowledged and agreed that the Borrower can amend its Organizational Documents to (a) authorize an increase in capital
stock, (b) create a class of blank check preferred Equity Interest and designate one of more series of preferred Equity Interest
as long as the preferred Equity Interest has no redemption obligations, (c) modify the indemnification provisions and (d) modify
the quorum requirements for annual meetings.

 

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Section 6.13         Changes
in Fiscal Periods. The Borrower shall not permit the fiscal year of the Borrower to end on a day other than December 31
or change the Borrower’s method of determining fiscal quarters.

 

Section 6.14         Redemption
of Permitted Secured Debt and Amendment of Permitted Secured Notes Documents and Permitted Refinancing Documents. The Borrower
will not, and will not permit any Subsidiary to: (a) prior to the date that is 180 days after the Maturity Date, call, make or
offer to make any optional or voluntary Redemption of or otherwise optionally or voluntarily Redeem (whether in whole or in part)
any Permitted Secured Debt or any Permitted Refinancing Debt, provided that the Borrower may optionally prepay the Permitted
Secured Debt with (i) the proceeds of Permitted Refinancing Debt and (ii) provided no Default or Event of Default or Borrowing
Base deficiency then exists or will result therefrom, the proceeds of any issuance of capital stock of the Borrower pursuant to
Section 3.07(a) of the Permitted Secured Notes Agreement (as in effect as of the Effective Date); (b) amend, modify, waive
or otherwise change, consent or agree to any amendment, modification, waiver or other change to, any of the terms of the Permitted
Secured Notes Agreement, any other Permitted Secured Notes Document, any Permitted Refinancing Debt that is secured Indebtedness
or any Permitted Refinancing Documents related thereto, except in accordance with the terms of the Intercreditor Agreement; or
(c) in the case of Permitted Refinancing Debt that is unsecured Indebtedness or any Permitted Refinancing Documents related thereto,
amend, modify, waive or otherwise change, consent or agree to any amendment, modification, waiver or other change to, any of the
terms of any such Permitted Refinancing Debt or any Permitted Refinancing Document related thereto except in compliance with the
definition of Permitted Refinancing Debt; provided that the foregoing shall not prohibit the execution of supplements to
add guarantors and grantors of security if required by the terms of the Permitted Refinancing Documents; and provided such
Person complies with Section 5.9.

 

Section 6.15         Anti-Money
Laundering and Anti-Terrorism Finance Laws; Foreign Corrupt Practices Act; Sanctions Laws; Restricted Person. The Borrower
shall not, and shall not permit any Loan Party or any Subsidiary thereof to, (a) engage in or conspire to engage in any transaction
that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any prohibition set forth in any Anti-Terrorism
Law, (b) cause or permit any of the funds that are used to repay the Obligations to be derived from any unlawful activity with
the result that the making of the Loans or the issuance of the Letters of Credit would be in violation of any Applicable Law, (c)
use any part of the proceeds of the Loans or Letters of Credit, directly or indirectly, for any payment to any governmental official
or employee, political party, official of a political party, candidate for political office, or anyone else acting in an official
capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign
Corrupt Practices Act of 1977 or (d) use any of the proceeds from the Loans or Letters of Credit to finance any operations, investments
or activities in, or make any payments to, any Restricted Person.

 

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Section 6.16         Limitation
on Leases. Neither the Borrower nor any Restricted Subsidiary will create, incur, assume or suffer to exist any obligation
for the payment of rent or hire of Property of any kind whatsoever (real or personal but excluding Capital Leases and leases of
Hydrocarbon Interests), under leases or lease agreements which would cause the aggregate amount of all payments made by the Borrower
and the Restricted Subsidiaries pursuant to all such leases or lease agreements, including, without limitation, any residual payments
at the end of any lease, to exceed $5,000,000 in any period of 12 consecutive calendar months during the life of such leases.

 

Section 6.17         Gas
Imbalances, Take-or-Pay or Other Prepayments. The Borrower will not allow gas imbalances, take-or-pay or other prepayments
(including pursuant to an Advance Payment Contract) with respect to the Oil and Gas Properties of the Borrower or any Restricted
Subsidiary that would require the Borrower or such Restricted Subsidiary to deliver Hydrocarbons at some future time without then
or thereafter receiving full payment therefor to exceed two percent of the annual production of gas of the Borrower and its Restricted
Subsidiaries for the most recent calendar year, each on an Mcf equivalent basis, in the aggregate.

 

Section 6.18         Hedging
Agreements.

 

(a)          The
Borrower will not, and will not permit any of its Restricted Subsidiaries to, enter into any Hedge Agreement except that the Borrower
shall be permitted to enter into, as of any date:

 

(i)          Hedge
Agreements relating to crude oil and natural gas (other than “put” contracts and basis differential hedging agreements)
with an Approved Counterparty related to bona fide (and not speculative) hedging activities of the Borrower and its Restricted
Subsidiaries with respect to which the aggregate notional volumes covered thereby do not exceed:

 

(x)          for
any month during the period from the then-current date until two years after the then-current date, 80% of the Borrower’s
and its Restricted Subsidiaries’ reasonably anticipated projected production of crude oil (for crude oil related Hedge Agreements),
and 80% of the Borrower’s and its Restricted Subsidiaries’ reasonably anticipated projected production of natural gas
(for natural gas related Hedge Agreements), in each case, for such month, from the Borrower’s and its Restricted Subsidiaries’
Oil and Gas Properties constituting “proved reserves;” and

 

(y)          for
any month during the period that is more than two years from the then-current date but less than or equal to four years from the
then-current date, 70% of the Borrower’s and its Restricted Subsidiaries’ reasonably anticipated projected production
of crude oil (for crude oil related Hedge Agreements), and 70% of the Borrower’s and its Restricted Subsidiaries’ reasonably
anticipated projected production of natural gas (for natural gas related Hedge Agreements), in each case, for such month, from
the Borrower’s and its Restricted Subsidiaries’ Oil and Gas Properties constituting “proved reserves”;
and

 

(z)          for
any month during the period that is more than four years from the then-current date but less than or equal to five years from the
then-current date, 60% of the Borrower’s and its Restricted Subsidiaries’ reasonably anticipated projected production
of crude oil (for crude oil related Hedge Agreements), and 60% of the Borrower’s and its Restricted Subsidiaries’ reasonably
anticipated projected production of natural gas (for natural gas related Hedge Agreements), in each case, for such month, from
the Borrower’s and its Restricted Subsidiaries’ Oil and Gas Properties constituting “proved reserves.”

 

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(ii)         Hedge
Agreements with an Approved Counterparty related to interest rates, the notional amounts of which do not exceed 50% of the then
outstanding principal amount of the Loans.

 

(b)          Notwithstanding
anything to the contrary in this Section 6.18, there shall be no prohibition under this Agreement or any other Loan Document
against the Borrower or any Restricted Subsidiary entering into any (i) “put” contracts or (ii) basis differential
hedging agreements on volumes hedged pursuant to other Hedge Agreements otherwise not prohibited hereunder, in each case, so long
as such agreements are entered into with an Approved Counterparty in the ordinary course of business for the purpose of hedging
against fluctuations of commodity prices.

 

(c)          Neither
the Borrower nor any Restricted Subsidiary will enter into any Hedge Agreement for the purpose of speculation with respect to the
levels of commodity prices in the future.

 

(d)          In
no event shall any Hedging Agreement contain any requirement, agreement or covenant for the Borrower or any Restricted Subsidiary
to post collateral or margin to secure their obligations under such Hedging Agreement or to cover market exposures, other than
a requirement that such Hedging Agreement be secured by the Security Documents.

 

(e)          Borrower
and its Restricted Subsidiaries shall not enter into any transaction under any Hedge Agreement with a term longer than 60 months
from the date such transaction is entered into.

 

For purposes of this Section 6.18, forecasts of projected
production shall equal the projections for Proved Developed Producing Reserves set out in the most recent Reserve Report as revised
in good faith to account for any increase or reductions therein anticipated based on information obtained by the Borrower subsequent
to the publication of the such Reserve Report, including the Borrower’s internal forecasts of production decline rates for
existing wells and additions to or deletions from anticipated future production from new wells and acquisitions coming on stream
or failing to come on stream and Dispositions of Oil and Gas Properties.

 

Section 6.19         Hedging
Agreement Termination. The Borrower will not, and will not permit any Restricted Subsidiary to, effect or permit a Hedge Liquidation
of any Hedging Agreement utilized in calculating PV-9 Value unless the Borrower is in compliance with Section 6.1 after
calculating PV-9 Value on a pro forma basis (and the Borrower shall deliver to the Administrative Agent concurrently therewith
a certificate of a Financial Officer setting forth reasonably detailed calculations demonstrating pro forma compliance with Section
6.1) to (a) remove the Hedging Agreement that is the subject of such Hedge Liquidation and (b) take into account any new Hedging
Agreement entered into at or about the same time.

 

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Section 6.20         Sale
and Leaseback Transactions and other Off-Balance Sheet Liabilities. The Borrower will not, nor will the Borrower permit any
of its Restricted Subsidiaries to, enter into or suffer to exist any (a) sale and leaseback transaction or (b) any other transaction
pursuant to which it incurs or has incurred Off-Balance Sheet Liabilities, except for (i) Hedging Agreements to the extent permitted
under the terms of Section 6.18 and (ii) Advance Payment Contracts to the extent permitted under the terms of Section 6.17.

 

Section 6.21         Sale
or Discount of Receivables. Except for receivables obtained by the Borrower or any Restricted Subsidiary that are outside the
ordinary course of business or the settlement of joint interest billing accounts in the ordinary course of business or discounts
granted to settle collection of accounts receivable or the sale of defaulted accounts arising in the ordinary course of business
in connection with the compromise or collection thereof and not in connection with any financing transaction, neither the Borrower
nor any Restricted Subsidiary will discount or sell (with or without recourse) any of its notes receivable or accounts receivable.

 

Section 6.22         Additional
Collateral for Permitted Secured Notes Facility. The Borrower will not, and will not permit its Subsidiaries to, grant a Lien
on any property or asset to secure the Permitted Secured Notes Facility or Permitted Refinancing Debt or provide any additional
guaranty or other credit enhancement in favor of the Permitted Secured Notes Agent or any Permitted Secured Notes Holder in connection
with the Permitted Secured Notes Facility or any Permitted Refinancing Documents without first (a) giving prior written notice
to the Administrative Agent thereof (which the Borrower shall endeavor to provide at least 15 days prior to such Lien being granted),
(b) granting to the Administrative Agent to secure the Obligations a first-priority, perfected Lien (subject to Liens permitted
under Section 6.3) on this same property or assets pursuant to Security Documents in form and substance satisfactory
to the Administrative Agent, and (c) providing the same guaranty or other credit enhancement in favor of the Administrative Agent
in connection with the Obligations.

 

Section 6.23         Canadian
Subsidiaries. Notwithstanding anything in the Loan Documents to the contrary, the Borrower and its Restricted Subsidiaries
shall not make any additional Investment in, nor transfer any cash or other assets to, EERG Energy ULC or AEE Canada Inc., and
such Subsidiaries shall remain dormant pending their dissolution pursuant to Section 5.18(a).

 

ARTICLE
VII

Events of Default

 

Section 7.1           Events
of Default. If any of the following events (“Events of Default”) shall occur:

 

(a)          the
Borrower shall fail to pay any principal of any Loan or any reimbursement obligation in respect of any LC Disbursement when and
as the same shall become due and payable, whether at the due date thereof or at a date fixed for prepayment thereof or otherwise;

 

(b)          the
Borrower shall fail to pay any interest on any Loan or any fee or any other amount (other than an amount referred to in clause (a)
of this Section 7.1) payable under this Agreement, when and as the same shall become due and payable, and such failure shall
continue unremedied for a period of three Business Days;

 

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(c)          any
representation or warranty made or deemed made by or on behalf of any Loan Party in or in connection with this Agreement, any other
Loan Document or any amendment or modification hereof or thereof or waiver hereunder or thereunder, or in any report, certificate,
financial statement or other document furnished pursuant to or in connection with this Agreement, any other Loan Document or any
amendment or modification hereof or thereof or waiver hereunder or thereunder, shall prove to have been incorrect or misleading
in any material respect when made or deemed made;

 

(d)          (i)          the
Borrower shall fail to observe or perform any covenant, condition or agreement contained in Section 5.2, 5.3
(with respect to the existence of any Loan Party), 5.5, 5.6 (other than the first sentence thereof), 5.8,
5.9(a), 5.9(c), 5.9(d) 5.15 or Article VI;

 

(ii)         the
Borrower shall fail to observe or perform any covenant, condition or agreement contained in Section 5.13 or 5.14
and such failure shall continue unremedied for a period of 10 Business Days;

 

(e)          any
Loan Party shall fail to observe or perform any covenant, condition or agreement contained in this Agreement or any other Loan
Document (other than those specified in clause (a), (b) or (d) of this Section 7.1), and such
failure shall continue unremedied for a period of 30 days after the earlier of (i) notice thereof from the Administrative
Agent to the Borrower (which notice will be given at the request of any Lender) and (ii) the date a Responsible Officer of the
Borrower or such other Loan Party had actual knowledge of such failure;

 

(f)          any
Loan Party shall fail to make any payment (whether of principal or interest and regardless of amount) in respect of any Material
Indebtedness, when and as the same shall become due and payable which failure shall continue beyond any cure period provided under
the terms of such Material Indebtedness;

 

(g)          any
event or condition occurs that results in any Material Indebtedness becoming due prior to its scheduled maturity or that enables
or permits (with or without the giving of notice, the lapse of time or both) the holder or holders of any Material Indebtedness
or any trustee or agent on its or their behalf to cause any Material Indebtedness to become due, or to require the prepayment,
repurchase, redemption or defeasance thereof, prior to its scheduled maturity or (in the case of any Material Indebtedness constituting
a Guarantee) to become payable; provided that this clause (g) shall not apply to secured Indebtedness that becomes
due as a result of the voluntary sale or transfer of the property or assets securing such Indebtedness if such voluntary sale or
transfer is permitted under this Agreement;

 

(h)          an
involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization
or other relief in respect of any Loan Party or its debts, or of a substantial part of its assets, under any Federal, state or
foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect or (ii) the appointment of a receiver,
trustee, custodian, sequestrator, conservator or similar official for any Loan Party or for a substantial part of its assets, and,
in any such case, such proceeding or petition shall continue undismissed for 60 days or an order or decree approving or ordering
any of the foregoing shall be entered;

 

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(i)          any
Loan Party shall (i) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization or other
relief under any Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii) consent
to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (h)
of this Section 7.1, (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for any Loan Party or for a substantial part of its assets, (iv) file an answer admitting
the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit
of creditors or (vi) take any action for the purpose of effecting any of the foregoing;

 

(j)          any
Loan Party shall become unable, admit in writing its inability or fail generally to pay its debts as they become due;

 

(k)          one
or more judgments for the payment of money in an aggregate amount in excess of $10,000,000 shall be rendered against any Loan Party
or any combination thereof and the same shall remain undischarged for a period of 30 consecutive days during which execution
shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to attach or levy upon any assets
of any Loan Party to enforce any such judgment;

 

(l)          an
ERISA Event shall have occurred that when taken together with all other ERISA Events that have occurred, could reasonably be expected
to result in a Material Adverse Effect;

 

(m)          any
material provision of any Loan Document, at any time after its execution and delivery and for any reason other than as expressly
permitted hereunder or thereunder or satisfaction in full of all the Obligations, shall cease to be in full force and effect; or
any Loan Party shall contest in any manner the validity or enforceability of any provision of any Loan Document; or any Loan Party
shall deny that it has any or further liability or obligation under any Loan Document, or shall purport to revoke, terminate or
rescind any provision of any Loan Document; or any Lien securing any Obligation shall, in whole or in part, fail to be a perfected
first priority lien (subject to Section 6.1) on any material portion of the Collateral purported to be covered hereby
or thereby;

 

(n)          a
Change in Control shall occur;

 

(o)          the
Intercreditor Agreement, after delivery thereof shall for any reason, except to the extent permitted by the terms thereof, cease
to be in full force and effect and valid, binding and enforceable in accordance with its terms against the Borrower, any other
Loan Party, the Permitted Secured Notes Agent, the Permitted Secured Notes Holders or any other party thereto or shall be repudiated
by any of them, or cease to establish the relative lien priorities required or purported thereby, or the Borrower, any other Loan
Party, the Permitted Secured Notes Agent, the Permitted Secured Notes Holders or any of their Affiliates shall so state in writing;
or

 

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(p)          an
“Event of Default” shall occur under the Permitted Secured Notes Agreement;

 

then, and in every such event (other than an event with respect
to the Borrower described in clause (h) or (i) of this Section 7.1), and at any time thereafter during
the continuance of such event, the Administrative Agent may, and at the request of the Majority Lenders shall, by notice to the
Borrower, take either or both of the following actions, at the same or different times:  (i) terminate the Commitments,
and thereupon the Commitments (if not theretofore terminated) shall terminate immediately, and (ii) declare the Loans then
outstanding to be due and payable in whole (or in part, in which case any principal not so declared to be due and payable may thereafter
be declared to be due and payable), and thereupon the principal of the Loans so declared to be due and payable, together with accrued
interest thereon and all fees and other Obligations of the Borrower (including all amounts of LC Exposure, whether or not the beneficiary
of any then-outstanding Letter of Credit shall have demanded payment thereunder) accrued hereunder, shall become due and payable
immediately, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower;
and in case of any event with respect to the Borrower described in clause (h) or (i) of this Section 7.1,
the Commitments (if not theretofore terminated) shall automatically terminate and the principal of the Loans then outstanding,
together with accrued interest thereon and all fees and other Obligations of the Borrower and the other Loan Parties (including
all amounts of LC Exposure, whether or not the beneficiary of any then-outstanding Letter of Credit shall have demanded payment
thereunder) accrued hereunder, shall automatically become due and payable, without presentment, demand, protest or other notice
of any kind, all of which are hereby waived by the Borrower. In addition, the Administrative Agent may also exercise on behalf
of itself, the Lenders and the Issuing Bank all other rights and remedies available to it, the Lenders and the Issuing Bank under
the Loan Documents or applicable law. With respect to all Letters of Credit having undrawn and unexpired amounts at the time of
an acceleration pursuant to this clause, the Borrower shall at such time deposit in a Cash Collateral account opened by the Administrative
Agent an amount equal to 105% of the aggregate then undrawn and unexpired amount of such Letters of Credit in accordance with Section 2.5(j).

 

Section 7.2           Application
of Proceeds. Except as otherwise provided by the Intercreditor Agreement, after the exercise of remedies provided for in Section 7.1
(or after the Commitments have automatically terminated and the principal of the Loans then outstanding, together with accrued
interest thereon and all fees and other Obligations of the Borrower accrued hereunder, have automatically become due and payable
and the LC Exposure has automatically been required to be Cash Collateralized under Section 7.1), any amounts received
on account of the Secured Obligations shall be applied by the Administrative Agent in the following order:

 

FIRST, to payment of that portion of the
Secured Obligations constituting fees, indemnities, expenses and other amounts (other than payment and interest, but including
fees, charges and disbursements of counsel to the Administrative Agent incident to the enforcement of any Loan Document and amounts
payable under Sections 2.14, 2.15, 2.16 or 2.17) payable to the Administrative Agent (or to the
trustee under any Mortgages) in its capacity as such;

 

SECOND, to payment of that portion of the
Secured Obligations constituting fees, indemnities and other amounts (other than principal and interest) payable to the Lenders
and the Issuing Bank (including fees, charges and disbursements of counsel to the respective Lenders and the Issuing Bank and amounts
payable under Sections 2.14, 2.15, 2.16 or 2.17), ratably among them in proportion to the amounts
described in this clause SECOND payable to them;

 

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THIRD, to payment of that portion of the
Secured Obligations constituting accrued and unpaid interest on the Loans, LC Disbursements and other Obligations, ratably among
the Lenders and the Issuing Bank in proportion to the respective amounts described in this clause THIRD payable to them;

 

FOURTH, to payment of that portion of the
Secured Obligations constituting unpaid principal of the Loans and LC Disbursements or payments for early termination of Lender
Provided Hedging Agreements (and any other unpaid amount then due and owing under any Lender Provided Hedging Agreement) or any
unpaid amount then due and owing under any Lender Provided Financial Service Product, in each case owed to a Person that is or
was a Lender or an Affiliate of a Lender at the time such Person entered into such Lender Provided Hedging Agreement, or Lender
Provided Financial Service Product, Cash Collateralize the aggregate undrawn amount of all outstanding Letters of Credit, as the
case may be, ratably among the Lenders, Affiliates of Lenders (if applicable), such Person (if applicable) and the Issuing Bank
in proportion to the respective amounts described in this clause FOURTH held by them;

 

FIFTH, to the payment of all other Secured
Obligations that are due and payable to the Administrative Agent and the other holders of Secured Obligations on such date, ratably
based upon the respective aggregate amounts of all such Secured Obligations owing to the Administrative Agent and the other holders
of Secured Obligations on such date;

 

SIXTH, if any Indebtedness under the Permitted
Secured Notes Facility is then outstanding, to the Permitted Secured Notes Agent in accordance with the terms of the Intercreditor
Agreement for application to the Permitted Secured Notes Holders in accordance with the terms of the Permitted Secured Notes Documents;
and

 

SEVENTH, the balance, if any, after all
of the Obligations have been paid in full, to the Borrower or other Loan Party entitled thereto or as otherwise required by applicable
law.

 

Amounts used to Cash Collateralize the aggregate undrawn amount
of Letters of Credit pursuant to clause Fourth above shall be applied to satisfy drawings under such Letters of Credit as they
occur. If any amount remains on deposit as Cash Collateral after all Letters of Credit have either been fully drawn or expired,
such remaining amount shall be applied to the other Obligations, if any, in the order set forth above. Excluded Hedging Obligations
with respect to any Guarantor shall not be paid with amounts received from such Guarantor or its assets, but at the discretion
of the Administrative Agent and to the extent not prohibited under applicable law, appropriate adjustments shall be made with respect
to payments from other Loan Parties to preserve the allocation to Indebtedness otherwise set forth above in this Section 7.2
assuming that, solely for purposes of such adjustments, Indebtedness includes Excluded Hedging Obligations.

 

Notwithstanding the foregoing, Obligations arising under Lender
Provided Financial Service Products and Lender Provided Hedge Agreements shall be excluded from the application described above
if the Administrative Agent has not received written notice thereof, together with such supporting documentation as the Administrative
Agent may request, from the applicable Lender or Lender Affiliate, as the case may be.

 

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ARTICLE
VIII

The Administrative Agent

 

Section 8.1           Appointment
and Authority. Each of the Lenders and the Issuing Banks hereby irrevocably appoints SunTrust to act on its behalf as the Administrative
Agent hereunder and under the other Loan Documents and authorizes the Administrative Agent to take such actions on its behalf and
to exercise such powers as are delegated to the Administrative Agent by the terms hereof or thereof, together with such actions
and powers as are reasonably incidental thereto. The provisions of this Article are solely for the benefit of the Administrative
Agent, the Lenders and the Issuing Banks, and neither the Borrower nor any other Loan Party shall have any rights as a third-party
beneficiary of any of such provisions. It is understood and agreed that the use of the term “agent” herein or in any
other Loan Documents (or any other similar term) with reference to the Administrative Agent is not intended to connote any fiduciary
or other implied (or express) obligation arising under agency doctrine of any Applicable Law. Instead such term is used as a matter
of market custom, and is intended to create or reflect only an administrative relationship between contracting parties.

 

Section 8.2           Rights
as a Lender. The Person serving as the Administrative Agent hereunder shall have the same rights and powers in its capacity
as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent, and the term “Lender”
or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include the Person
serving as the Administrative Agent hereunder in its individual capacity. Such Person and its Affiliates may accept deposits from,
lend money to, own securities of, act as the financial advisor or in any other advisory capacity for, and generally engage in any
kind of business with, the Borrower or any Subsidiary or other Affiliate thereof as if such Person were not the Administrative
Agent hereunder and without any duty to account therefor to the Lenders.

 

Section 8.3           Exculpatory
Provisions. (a) The Administrative Agent shall not have any duties or obligations except those expressly set forth herein and
in the other Loan Documents, and its duties hereunder shall be administrative in nature. Without limiting the generality of the
foregoing, the Administrative Agent:

 

(i)          shall
not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing;

 

(ii)         shall
not have any duty to take any discretionary action or exercise any discretionary power, except discretionary rights and powers
expressly contemplated hereby or by the other Loan Documents that the Administrative Agent is required to exercise as directed
in writing by the Majority Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein
or in the other Loan Documents); provided that the Administrative Agent shall not be required to take any action that, in
its opinion or the opinion of its counsel, may expose the Administrative Agent to liability or that is contrary to any Loan Document
or Applicable Law, including for the avoidance of doubt any action that may be in violation of the automatic stay under any Debtor
Relief Law or that may effect a forfeiture, modification or termination of property of a Defaulting Lender in violation of any
Debtor Relief Law; and

 

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(iii)        shall
not, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for
the failure to disclose, any information relating to the Borrower or any of its Affiliates that is communicated to or obtained
by the Person serving as the Administrative Agent or any of its Affiliates in any capacity.

 

(b)          The
Administrative Agent shall not be liable for any action taken or not taken by it (i) with the consent or at the request of the
Majority Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall
believe in good faith shall be necessary, under the circumstances as provided in Section 9.2 and Article VII)
or (ii) in the absence of its own gross negligence or willful misconduct as determined by a court of competent jurisdiction by
final and nonappealable judgment. The Administrative Agent shall be deemed not to have knowledge of any Default unless and until
notice describing such Default is given to the Administrative Agent in writing by the Borrower, a Lender or an Issuing Bank.

 

(c)          The
Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or
representation made in or in connection with this Agreement or any other Loan Document, (ii) the contents of any certificate, report
or other document delivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance
of any covenant, agreement or other term or condition set forth herein or therein or the occurrence of any Default, (iv) the validity,
enforceability, effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document
or (v) the satisfaction of any condition set forth in Article IV or elsewhere herein, other than to confirm receipt
of items expressly required to be delivered to the Administrative Agent.

 

Section 8.4           Reliance
by Administrative Agent. The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying
upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message,
Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise
authenticated by the proper Person or Persons and upon advice and statements of legal counsel (including counsel to the Borrower),
independent accountants and other experts selected by the Administrative Agent. The Administrative Agent also may rely upon any
statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any
liability for relying thereon. In determining compliance with any condition hereunder to the making of a Loan, or the issuance,
extension or increase of a Letter of Credit, that by its terms must be fulfilled to the satisfaction of a Lender or an Issuing
Bank, the Administrative Agent may presume that such condition is satisfactory to such Lender or Issuing Bank unless the Administrative
Agent shall have received notice to the contrary from such Lender or Issuing Bank prior to the making of such Loan or the issuance
of such Letter of Credit. The Administrative Agent may consult with legal counsel (who may be counsel for the Borrower), independent
accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with
the advice of any such counsel, accountants or experts. The Administrative Agent may deem and treat the payee of any Revolving
Note as the owner thereof for all purposes unless a written notice of assignment, negotiation or transfer thereof shall have been
filed with the Administrative Agent. The Administrative Agent shall be fully justified in failing or refusing to take any action
under this Agreement or any other Loan Document unless it shall first receive such advice or concurrence of the Majority Lenders
(or, if so specified by this Agreement, all Lenders) as it deems appropriate or it shall first be indemnified to its satisfaction
by the Lenders against any and all liability and expense that may be incurred by it by reason of taking or continuing to take any
such action. The Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting, under this
Agreement and the other Loan Documents in accordance with a request of the Majority Lenders (or, if so specified by this Agreement,
all Lenders), and such request and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders and
all future holders of the Loans.

 

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Section 8.5           Delegation
of Duties. The Administrative Agent may perform any and all of its duties and exercise its rights and powers hereunder or under
any other Loan Document by or through any one or more sub-agents appointed by the Administrative Agent. The Administrative Agent
and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through their respective
Related Parties. The exculpatory provisions of this Article shall apply to any such sub-agent and to the Related Parties of the
Administrative Agent and any such sub-agent, and shall apply to their respective activities in connection with the syndication
of the Facilities as well as activities as Administrative Agent. The Administrative Agent shall not be responsible for the negligence
or misconduct of any sub-agent except to the extent that a court of competent jurisdiction determines in a final and nonappealable
judgment that the Administrative Agent acted with gross negligence or willful misconduct in the selection of such sub-agent.

 

Section 8.6           Resignation
of Administrative Agent. (a) The Administrative Agent may at any time give notice of its resignation to the Lenders, the Issuing
Banks and the Borrower. Upon receipt of any such notice of resignation, the Majority Lenders shall have the right, in consultation
with the Borrower, to appoint a successor, which shall be a bank with an office in New York, New York, or an Affiliate of any such
bank with an office in New York, New York. If no such successor shall have been so appointed by the Majority Lenders and shall
have accepted such appointment within 30 days after the retiring Administrative Agent gives notice of its resignation (or such
earlier day as shall be agreed by the Majority Lenders) (the “Resignation Effective Date”), then the retiring
Administrative Agent may (but shall not be obligated to), on behalf of the Lenders and the Issuing Banks, appoint a successor Administrative
Agent meeting the qualifications set forth above. Whether or not a successor has been appointed, such resignation shall become
effective in accordance with such notice on the Resignation Effective Date.

 

(b)          If
the Person serving as Administrative Agent is a Defaulting Lender pursuant to clause (d) of the definition thereof,
the Majority Lenders may, to the extent permitted by Applicable Law, by notice in writing to the Borrower and such Person remove
such Person as Administrative Agent and, in consultation with the Borrower, appoint a successor. If no such successor shall have
been so appointed by the Majority Lenders and shall have accepted such appointment within 30 days (or such earlier day as shall
be agreed by the Majority Lenders) (the “Removal Effective Date”), then such removal shall nonetheless become
effective in accordance with such notice on the Removal Effective Date.

 

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(c)          With
effect from the Resignation Effective Date or the Removal Effective Date (as applicable) (i) the retiring or removed Administrative
Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents (except that in the case
of any Collateral held by the Administrative Agent on behalf of the Lenders or the Issuing Banks under any Loan Document, the retiring
or removed Administrative Agent shall continue to hold such Collateral until such time as a successor Administrative Agent is appointed)
and (ii) except for any indemnity payments owed to the retiring or removed Administrative Agent, all payments, communications and
determinations provided to be made by, to or through the Administrative Agent shall instead be made by or to each Lender and Issuing
Bank directly, until such time, if any, as the Majority Lenders appoint a successor Administrative Agent as provided for above.
Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, such successor shall succeed to and become
vested with all of the rights, powers, privileges and duties of the retiring or removed Administrative Agent (other than any rights
to indemnity payments owed to the retiring or removed Administrative Agent), and the retiring or removed Administrative Agent shall
be discharged from all of its duties and obligations hereunder or under the other Loan Documents. The fees payable by the Borrower
to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower
and such successor. After the retiring or removed Administrative Agent’s resignation or removal hereunder and under the other
Loan Documents, the provisions of this Article and Section 9.3 shall continue in effect for the benefit of such retiring
or removed Administrative Agent, its sub-agents and their respective Related Parties in respect of any action taken or omitted
to be taken by any of them while the retiring or removed Administrative Agent was acting as Administrative Agent.

 

Section 8.7           Non-Reliance
on Administrative Agent and Other Lenders. Each Lender and Issuing Bank acknowledges and agrees that the extensions of credit
made hereunder are commercial loans and letters of credit and not investments in a business enterprise or securities. Each Lender
and Issuing Bank represents that it is engaged in making, acquiring or holding commercial loans in the ordinary course of its business
and that it has, independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties
and based on such documents and information (which may contain material, non-public information within the meaning of the United
States securities laws concerning the Borrower and its Affiliates) as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each Lender and Issuing Bank also acknowledges that it will, independently and without reliance
upon the Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as
it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon
this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder.

 

Section 8.8           No
Other Duties, etc. Anything herein to the contrary notwithstanding, none of the Bookrunners, Arrangers or Syndication Agent
listed on the cover page hereof shall have any powers, duties or responsibilities under this Agreement or any other Loan Document,
except in its capacity, as applicable, as the Administrative Agent, a Lender or an Issuing Bank hereunder.

 

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Section 8.9           Enforcement.
Notwithstanding anything to the contrary contained herein or in any other Loan Document, the authority to enforce rights and remedies
hereunder and under the other Loan Documents against any Loan Party shall be vested exclusively in, and all actions and proceedings
at law in connection with such enforcement shall be instituted and maintained exclusively by, the Administrative Agent in accordance
with Section 8.1 for the benefit of all the Lenders and the Issuing Banks; provided that the foregoing shall
not prohibit (a) the Administrative Agent from exercising on its own behalf the rights and remedies that inure to its benefit (solely
in its capacity as Administrative Agent) hereunder and under the other Loan Documents, (b) any Issuing Bank Lender from exercising
the rights and remedies that inure to its benefit (solely in its capacity as Issuing Bank) hereunder and under the other Loan Documents,
(c) any Lender from enforcing its right to payment when due of the principal of and interest on its Loans, fees and other amounts
owing to such Lender under the Loan Documents, (d) any Lender from exercising setoff rights in accordance with Section 9.8
(subject to the terms of Section 2.18) or (e) any Lender from filing proofs of claim or appearing and filing pleadings
on its own behalf during the pendency of a proceeding relative to any Loan Party under any Debtor Relief Law; and provided,
further, that if at any time there is no Person acting as Administrative Agent hereunder and under the other Loan Documents,
then (i) the Required Lenders shall have the rights otherwise ascribed to the Administrative Agent pursuant to this Article VIII
and (ii) in addition to the matters set forth in clauses (b), (c) , (d) and (e) of the preceding
proviso and subject to Section 2.18, any Lender may, with the consent of the Required Lenders, enforce any rights
and remedies available to it and as authorized by the Required Lenders.

 

Section 8.10         Administrative
Agent May File Proofs of Claim. In case of the pendency of any proceeding under any Debtor Relief Law or any other judicial
proceeding relative to any Loan Party, the Administrative Agent (irrespective of whether the principal of any Loan or LC Exposure
shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative
Agent shall have made any demand on the Borrower) shall be entitled and empowered (but not obligated) by intervention in such proceeding
or otherwise:

 

(a)          to
file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans, LC Exposure
and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order
to have the claims of the Lenders, the Issuing Banks and the Administrative Agent (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Lenders, the Issuing Banks and the Administrative Agent and their respective agents
and counsel and all other amounts due the Lenders, the Issuing Banks and the Administrative Agent under Sections 2.11
and 9.3) allowed in such judicial proceeding; and

 

(b)          to
collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same;

 

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and any custodian, receiver, assignee, trustee, liquidator,
sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender and Issuing Bank to
make such payments to the Administrative Agent and, in the event that the Administrative Agent shall consent to the making of such
payments directly to the Lenders and the Issuing Banks, to pay to the Administrative Agent any amount due for the reasonable compensation,
expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative
Agent under Sections 2.11 and 9.3.

 

Section 8.11         Collateral
and Guaranty Matters. (a) Each Lender, on behalf of itself and each Lender’s Affiliate that is a counterparty to a Lender
Provided Hedging Agreement or Lender Provided Financial Service Product, irrevocably authorize the Administrative Agent, at its
option and in its discretion,

 

(i)          to
release any Lien on any property granted to or held by the Administrative Agent under any Loan Document (A) on or after the Termination
Date (other than continuing Cash Collateral for Letters of Credit), (B) that is sold or otherwise disposed of or to be sold or
otherwise disposed of as part of or in connection with any sale or other Disposition permitted under the Loan Documents or (C)
subject to Section 9.2, if approved, authorized or ratified in writing by the Majority Lenders;

 

(ii)         to
subordinate any Lien on any property granted to or held by the Administrative Agent under any Loan Document to the holder of any
Lien on such property that is permitted by Section 6.3(e); and

 

(iii)        to
release any Guarantor from its obligations under the Loan Documents if such Person ceases to be a Restricted Subsidiary as a result
of a transaction permitted under the Loan Documents.

 

Upon request by the Administrative Agent
at any time, the Majority Lenders will confirm in writing the Administrative Agent’s authority to release or subordinate
its interest in particular types or items of property, or to release any Guarantor from its obligations under the Loan Documents
pursuant to this Section 8.11.

 

(b)          The
Administrative Agent shall not be responsible for or have a duty to ascertain or inquire into any representation or warranty regarding
the existence, value or collectability of any Collateral, the existence, priority or perfection of the Administrative Agent’s
Lien thereon, or any certificate prepared by any Loan Party in connection therewith, nor shall the Administrative Agent be responsible
or liable to the Lenders for any failure to monitor or maintain any portion of the Collateral.

 

Section 8.12         Lender
Provided Hedging Agreements and Lender Provided Financial Service Products.

 

(a)          No
holder of Secured Obligations in respect of Lender Provided Hedging Agreements or Lender Provided Financial Service Products shall
have any right to notice of any action or to consent to, direct or object to any action hereunder or under any other Loan Document
or otherwise in respect of the Collateral (including the release or impairment of any Collateral) other than in its capacity as
a Lender and, in such case, only to the extent expressly provided in the Loan Documents.

 

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(b)          The
benefit of the Security Documents and the provisions of this Agreement and the other Loan Documents relating to the Collateral
shall also extend to, secure and be available on a pro rata basis (as set forth in Section 7.2 of this Agreement) to
each Lender or Affiliate of a Lender that is a counterparty to a Lender Provided Hedging Agreement (including any Lender Provided
Hedging Agreement in existence prior to the date hereof) with respect to any obligations of the Borrower or any Subsidiary arising
under such Lender Provided Hedging Agreement, but only with respect to any Lender Provided Hedging Agreement, and the transactions
thereunder, that were entered into while such Person or its Affiliate was a Lender or prior to such time, until either (i) such
obligations arising under such Lender Provided Hedging Agreements are paid in full or otherwise expire or are terminated or (ii)
the Security Documents are otherwise released in accordance with Section 8.11(a)(i) or terminate; provided that
with respect to any Lender Provided Hedging Agreement that remains secured after the counterparty thereto is no longer a Lender
or an Affiliate of a former Lender or the outstanding Obligations have been repaid in full and the Commitments have terminated,
the provisions of Article VIII shall also continue to apply to such counterparty in consideration of its benefits hereunder
and each such counterparty shall, if requested by the Administrative Agent, promptly execute and deliver to the Administrative
Agent all such other documents, agreements and instruments reasonably requested by the Administrative Agent to evidence the continued
applicability of the provisions of Article VIII.

 

(c)          Notwithstanding
anything contained in any of the Loan Documents to the contrary, the Borrower, the Administrative Agent, and each Lender, for itself
and on behalf of its Affiliates party to Lender Provided Hedging Agreements, hereby agree that no Lender, Affiliate of a Lender
or other party to any Loan Document (other than the Administrative Agent) or a Lender Provided Hedging Agreement shall have any
right individually to realize upon any of the Collateral or to enforce any Security Document, it being understood and agreed that
all powers, rights and remedies hereunder and under the Security Documents may be exercised solely by Administrative Agent on behalf
of the Lenders in accordance with the terms hereof. By accepting the benefit of the Liens granted pursuant to the Security Documents,
each lender not party hereto hereby agrees to the terms of this Section 8.12.

 

Section 8.13         INTERCREDITOR
AGREEMENT. 

 

(a)          EACH
LENDER HEREBY (I) INSTRUCTS AND AUTHORIZES THE ADMINISTRATIVE AGENT TO EXECUTE AND DELIVER THE INTERCREDITOR AGREEMENT ON ITS BEHALF,
(II) AUTHORIZES AND DIRECTS THE ADMINISTRATIVE AGENT TO EXERCISE ALL OF THE ADMINISTRATIVE AGENT’S RIGHTS AND TO COMPLY WITH
ALL OF ITS OBLIGATIONS UNDER THE INTERCREDITOR AGREEMENT, (III) AGREES THAT THE ADMINISTRATIVE AGENT MAY TAKE ACTIONS ON ITS BEHALF
AS IS CONTEMPLATED BY THE TERMS OF THE INTERCREDITOR AGREEMENT, AND (IV) UNDERSTANDS, ACKNOWLEDGES AND AGREES THAT AT ALL TIMES
FOLLOWING THE EXECUTION AND DELIVERY OF THE INTERCREDITOR AGREEMENT SUCH LENDER (AND EACH OF ITS SUCCESSORS AND ASSIGNS) SHALL
BE BOUND BY THE TERMS THEREOF.

 

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(b)          EACH
LENDER ACKNOWLEDGES THAT IT HAS REVIEWED AND IS SATISFIED WITH THE TERMS AND PROVISIONS OF THE INTERCREDITOR AGREEMENT AND ACKNOWLEDGES
AND AGREES THAT SUCH LENDER IS RESPONSIBLE FOR MAKING ITS OWN ANALYSIS AND REVIEW OF THE INTERCREDITOR AGREEMENT AND THE TERMS
AND PROVISIONS THEREOF, AND NO AGENT OR ANY OF ITS AFFILIATES MAKES ANY REPRESENTATION TO ANY LENDER AS TO THE SUFFICIENCY OR ADVISABILITY
OF THE PROVISIONS CONTAINED IN THE INTERCREDITOR AGREEMENT.

 

Section 8.14         Indemnification.
Without limiting the obligations of the Lenders under Section 9.3, the Lenders agree to indemnify the Administrative Agent
(to the extent not reimbursed by the Borrower and without limiting the obligation of the Borrower to do so), ratably according
to their respective Applicable Percentages in effect on the date on which indemnification is sought under this Section (or, if
indemnification is sought after the date upon which the Commitments shall have terminated and the Loans shall have been paid in
full, ratably in accordance with such Applicable Percentages immediately prior to such date), from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever that
may at any time (whether before or after the payment of the Loans) be imposed on, incurred by or asserted against such Administrative
Agent in any way relating to or arising out of, the Commitments, this Agreement, any of the other Loan Documents or any documents
contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted
by such Administrative Agent under or in connection with any of the foregoing; provided that no Lender shall be liable for
the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses
or disbursements that are found by a final and nonappealable decision of a court of competent jurisdiction to have resulted from
such Administrative Agent’s gross negligence or willful misconduct. The agreements in this Section shall survive the termination
of this Agreement and the payment of the Loans and all other amounts payable hereunder.

 

ARTICLE
IX

Miscellaneous

 

Section 9.1           Notices;
Effectiveness; Electronic Communication.

 

(a)          Notices
Generally. Except in the case of notices and other communications expressly permitted to be given by telephone (and except
as provided in clause (b) below), all notices and other communications provided for herein shall be in writing and
shall be delivered by hand or overnight courier service, mailed by certified or registered mail, sent by telecopy or (if arrangements
for doing so have been approved by the Administrative Agent) electronic communication as follows:

 

(i)          if
to the Borrower or any other Loan Party, to it at American Eagle Energy Corporation, 2549 W. Main Street, Suite 202, Littleton,
Colorado 80120, Attention of Brad Colby, Chief Executive Officer (Telecopy No. 303-798-5767);

 

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With copies to: Baker & Hostetler LLP,
600 Anton Blvd., Suite 900, Costa Mesa, California 92626, Attention of Randolf W. Katz, Esq. (Telecopy No. 714-966-8802), and Roberts
& Olivia, LLC, 2060 Broadway; Suite 250, Boulder, Colorado 80302, Attention of William R. Roberts, Esq. (Telecopy No. 720-210-5447).

 

(ii)         if
to the Administrative Agent, to SUNTRUST BANK at 3333 Peachtree Street, N.E., Atlanta, Georgia 30326, Attention of Yann Pirio (Telecopy
No. 404-827-6270).

 

With a copy to: SunTrust Bank Agency Services,
at 303 Peachtree Street, N.E. 25th Floor, Atlanta, Georgia 30308, Attention of Doug Weltz (Telecopy No. 404-221-2001).

 

(iii)        if
to SUNTRUST BANK in its capacity as Issuing Bank, to it at 25 Park Place, N.E., Mail Code 3706, 16th Floor, Atlanta,
Georgia 30303, Attention of Standby Letter of Credit Dept. (Telecopy No. 404-588-8129) and if to any other Issuing Bank, to
it at the address provided in writing to the Administrative Agent and the Borrower at the time of its appointment as an Issuing
Bank hereunder; and

 

(iv)        if
to a Lender, to it at its address (or telecopy number or e-mail address) set forth in its Administrative Questionnaire.

 

Notices sent by hand or overnight courier service, or mailed
by certified or registered mail, shall be deemed to have been given when received; notices sent by telecopy shall be deemed to
have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been
given at the opening of business on the next business day for the recipient). Notices delivered through electronic communications,
to the extent provided in clause (b) below, shall be effective as provided in said clause (b).

 

(b)          Electronic
Communications. Notices and other communications to the Lenders and the Issuing Banks hereunder may be delivered or furnished
by electronic communication (including e-mail and Internet or intranet websites) pursuant to procedures approved by the Administrative
Agent; provided that the foregoing shall not apply to notices to any Lender or Issuing Bank pursuant to Article II
if such Lender or Issuing Bank, as applicable, has notified the Administrative Agent that it is incapable of receiving notices
under such Article by electronic communication. The Administrative Agent or the Borrower may, in its discretion, agree to accept
notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided
that approval of such procedures may be limited to particular notices or communications.

 

Unless the Administrative Agent otherwise
prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt
of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available,
return e-mail or other written acknowledgement) and (ii) notices or communications posted to an Internet or intranet website shall
be deemed received upon the deemed receipt by the intended recipient, at its e-mail address as described in the foregoing clause (i),
of notification that such notice or communication is available and identifying the website address therefor; provided that,
for both clauses (i) and (ii) above, if such notice, e-mail or other communication is not sent during the normal
business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the
next business day for the recipient.

 

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(c)          Change
of Address, etc. Any party hereto may change its address, telecopy number or e-mail address for notices and other communications
hereunder by notice to the other parties hereto.

 

Section 9.2           Waivers;
Amendments. (a) No failure or delay by the Administrative Agent, any Issuing Bank or any Lender in exercising any right or
power hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any
abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the
exercise of any other right or power. The rights and remedies of the Administrative Agent, the Issuing Banks and the Lenders hereunder
are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of this
Agreement or consent to any departure by the Borrower therefrom shall in any event be effective unless the same shall be permitted
by clause (b) of this Section, and then such waiver or consent shall be effective only in the specific instance and
for the purpose for which given. Without limiting the generality of the foregoing, the making of a Loan or issuance of a Letter
of Credit shall not be construed as a waiver of any Default, regardless of whether the Administrative Agent, any Lender or any
Issuing Bank may have had notice or knowledge of such Default at the time.

 

(b)          No
Loan Document nor any provision thereof may be waived, amended or modified except, in the case of this Agreement, pursuant to an
agreement or agreements in writing entered into by the Borrower and the Majority Lenders or, in the case of any other Loan Document,
by an agreement in writing entered into by the Borrower and the Majority Lenders or by the Borrower and the Administrative Agent
with the consent of the Majority Lenders; provided that no such agreement shall (i) increase the Maximum Credit Amount of
any Lender without the written consent of such Lender, increase the Borrowing Base without the written consent of all of the Lenders
and the Borrower, decrease or maintain the Borrowing Base without the consent of the Required Lenders, or modify Section 2.4
or the definition of the term “Borrowing Base” without the consent of each Lender (other than any Defaulting
Lender), provided that a Scheduled Redetermination may be postponed by the Required Lenders, (ii) reduce the principal
amount of any Loan or LC Disbursement or reduce the rate of interest thereon, or reduce any fees payable hereunder, or reduce any
other Obligation hereunder or under the Loan Document without the written consent of each Lender directly affected thereby, (iii)
postpone the scheduled date of payment or prepayment of the principal amount of any Loan or LC Disbursement, or any interest thereon,
or any fees payable hereunder, or any other Obligations hereunder or under the Loan Document or reduce the amount of, waive or
excuse any such payment, or postpone the scheduled date of expiration of any Commitment, without the written consent of each Lender
affected thereby, (iv) change Section 2.18(b) or (c) in a manner that would alter the pro rata
sharing of payments required thereby, without the written consent of each Lender, (v) release any Guarantor from the Guarantee
and Collateral Agreement (other than in connection with the sale of such Guarantor in a transaction permitted by Section 6.5),
or release all or substantially all of the Collateral in any transaction or series of related transactions, in each case without
the written consent of each Lender, (vi) change any provision of this Section or the definition of “Majority Lenders,”
“Required Lenders” or any other provision hereof specifying the number or percentage of Lenders required to
waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent
of each Lender, (vii) waive or amend Section 2.10(c), Section 4.1, Section 5.9 or Section 8.11
or change the definition of the terms “Domestic Subsidiary,” “Foreign Subsidiary” or “Subsidiary”,
or (viii) reduce the percentage of proved Oil and Gas Properties required to be mortgaged, without the written consent of each
Lender; provided further that no such agreement shall amend, modify or otherwise affect the rights or duties of the
Administrative Agent or any Issuing Bank hereunder without the prior written consent of the Administrative Agent or such Issuing
Bank, as the case may be.

 

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(c)          Notwithstanding
the definition of “Act of Required Debtholders” set forth in the Intercreditor Agreement, for purposes of that definition,
(i) at any time there are three or fewer Lenders, the required percentage in clause (i) of that definition shall be 100%
and (ii) the Maximum Credit Amounts and the principal amount of the Loans and participation interests in Letters of Credit of the
Defaulting Lenders shall be excluded from the determination of such definition.

 

Section 9.3           Expenses;
Indemnity; Damage Waiver.

 

(a)          Costs
and Expenses. The Borrower shall pay (i) all reasonable out-of-pocket expenses incurred by the Administrative Agent and its
Affiliates (including the reasonable fees, charges and disbursements of counsel for the Administrative Agent) in connection with
the syndication of the Facilities, the preparation, negotiation, execution, delivery and administration of this Agreement and the
other Loan Documents, or any amendment, modification or waiver of the provisions hereof or thereof (whether or not the transactions
contemplated hereby or thereby shall be consummated), (ii) all out-of-pocket expenses incurred by any Issuing Bank in connection
with the issuance, amendment or extension of any Letter of Credit or any demand for payment thereunder and (iii) all out-of-pocket
expenses incurred by the Administrative Agent, any Lender or any Issuing Bank (including the fees, charges and disbursements of
any counsel for the Administrative Agent, any Lender or any Issuing Bank), in connection with the enforcement or protection of
its rights (A) in connection with this Agreement and the other Loan Documents, including its rights under this Section or (B) in
connection with the Loans made or Letters of Credit issued hereunder, including all such out-of-pocket expenses incurred during
any workout, restructuring or negotiations in respect of such Loans or Letters of Credit.

 

(b)          Indemnification
by the Borrower. The Borrower shall indemnify the Administrative Agent (and any sub-agent thereof), each Lender and each Issuing
Bank, and each Related Party of each of the foregoing Persons (each such Person being called an “Indemnitee”)
against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses (including
the fees, charges and disbursements of any counsel for any Indemnitee), incurred by any Indemnitee or asserted against any Indemnitee
by any Person (including the Borrower or any other Loan Party) arising out of, in connection with, or as a result of (i) the execution
or delivery of this Agreement, any other Loan Document or any agreement or instrument contemplated hereby or thereby, the performance
by the parties hereto of their respective obligations hereunder or thereunder or the consummation of the transactions contemplated
hereby or thereby, (ii) any Loan or Letter of Credit or the use or proposed use of the proceeds therefrom (including any refusal
by any Issuing Bank to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand
do not strictly comply with the terms of such Letter of Credit), (iii) any actual or alleged presence or release of Hazardous Materials
on or from any property owned or operated by the Borrower or any Subsidiary, or any Environmental Liability related in any way
to the Borrower or any Subsidiary or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to
any of the foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by the Borrower
or any other Loan Party, and regardless of whether any Indemnitee is a party thereto; and such indemnity shall extend to each Indemnitee
notwithstanding the sole or concurrent negligence of every kind or character whatsoever, whether active or passive, whether an
affirmative act or an omission, including without limitation, all types of negligent conduct identified in the Restatement (Second)
of Torts of one or more of the Indemnitees or by reason of strict liability imposed without fault on any one or more of the Indemnitees;
provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages,
liabilities or related expenses are determined by a court of competent jurisdiction by final and nonappealable judgment to have
resulted from the gross negligence or willful misconduct of such Indemnitee. This Section 9.3(b) shall not apply with
respect to Taxes other than any Taxes that represent losses, claims, damages, liabilities and related expenses arising from any
non-Tax claim.

 

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(c)          Reimbursement
by Lenders. To the extent that the Borrower for any reason fails to indefeasibly pay any amount required under clause (a)
or (b) of this Section to be paid by it to the Administrative Agent (or any sub-agent thereof), any Issuing Bank or any
Related Party of any of the foregoing, each Lender severally agrees to pay to the Administrative Agent (or any such sub-agent),
such Issuing Bank or such Related Party, as the case may be, such Lender’s pro rata share (determined as of
the time that the applicable unreimbursed expense or indemnity payment is sought based on each Lender’s share of the total
Credit Exposure at such time) of such unpaid amount (including any such unpaid amount in respect of a claim asserted by such Lender);
provided that with respect to such unpaid amounts owed to any Issuing Bank solely in its capacity as such, only the Lenders
shall be required to pay such unpaid amounts, such payment to be made severally among them based on such Lenders’ Applicable
Percentages (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought); provided,
further, that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may
be, was incurred by or asserted against the Administrative Agent (or any such sub-agent), or such Issuing Bank in its capacity
as such, or against any Related Party of any of the foregoing acting for the Administrative Agent (or any such sub-agent) or such
Issuing Bank in connection with such capacity. The obligations of the Lenders under this clause (c) are subject to
the provisions of Section 2.18(e).

 

(d)          Waiver
of Consequential Damages, etc. To the fullest extent permitted by Applicable Law, the Borrower shall not assert, and hereby
waives, any claim against any Indemnitee, on any theory of liability, for indirect, special, punitive, consequential or exemplary
damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other
Loan Document or any agreement or instrument contemplated hereby or thereby, the transactions contemplated hereby or thereby, any
Loan or Letter of Credit, or the use of the proceeds thereof. No Indemnitee referred to in clause (b) above shall be
liable for any damages arising from the use by unintended recipients of any information or other materials distributed by it through
telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents
or the transactions contemplated hereby or thereby.

 

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(e)          Payments.
All amounts due under this Section shall be payable not later than three Business Days after demand therefor.

 

(f)          Survival.
Each party’s obligations under this Section shall survive the termination of the Loan Documents and payment of the other
Obligations.

 

Section 9.4           Successors
and Assigns.

 

(a)          Successors
and Assigns Generally. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereby, except that the Borrower may not assign or otherwise transfer any
of its rights or obligations hereunder without the prior written consent of the Administrative Agent and each Lender, and no Lender
may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an assignee in accordance with the provisions
of clause (b) of this Section, (ii) by way of participation in accordance with the provisions of clause (d)
of this Section or (iii) by way of pledge or assignment of a security interest subject to the restrictions of clause (e)
of this Section (and any other attempted assignment or transfer by any party hereto shall be null and void). Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors
and assigns permitted hereby, Participants to the extent provided in clause (d) of this Section and, to the extent
expressly contemplated hereby, the Related Parties of each of the Administrative Agent and the Lenders) any legal or equitable
right, remedy or claim under or by reason of this Agreement.

 

(b)          Assignments
by Lenders. Any Lender may at any time assign to one or more assignees all or a portion of its rights and obligations under
this Agreement (including all or a portion of its Commitments and the Loans at the time owing to it); provided that any
such assignment shall be subject to the following conditions:

 

(i)          Minimum
Amounts.

 

(1)         in
the case of an assignment of the entire remaining amount of the assigning Lender’s Commitment and/or the Loans at the time
owing to it or in the case of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum amount need be
assigned; and

 

(2)         in
any case not described in clause (b)(i)(1) of this Section, the aggregate amount of the Commitment (which for this
purpose includes Loans outstanding thereunder) or, if the applicable Commitment is not then in effect, the principal outstanding
balance of the Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Assumption
with respect to such assignment is delivered to the Administrative Agent or, if a “Trade Date” is specified
in the Assignment and Assumption, as of the Trade Date) shall not be less than $5,000,000 and minimum increments of $1,000,000,
and the assignor shall hold no interest or a minimum $5,000,000 interest, unless each of the Administrative Agent and, so long
as no Event of Default has occurred and is continuing, the Borrower otherwise consents (each such consent not to be unreasonably
withheld or delayed).

 

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(ii)         Proportionate
Amounts. Each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s
rights and obligations under this Agreement with respect to the Loan or the Commitment assigned.

 

(iii)        Required
Consents. No consent shall be required for any assignment except to the extent required by clause (b)(i)(2) of
this Section and, in addition:

 

(1)         the
consent of the Borrower (such consent not to be unreasonably withheld or delayed) shall be required unless (x) an Event of Default
has occurred and is continuing at the time of such assignment or (y) such assignment is to a Lender, an Affiliate of a Lender or
an Approved Fund; provided that the Borrower shall be deemed to have consented to any such assignment unless it shall object
thereto by written notice to the Administrative Agent within five (5) Business Days after having received notice thereof;

 

(2)         the
consent of the Administrative Agent (such consent not to be unreasonably withheld or delayed) shall be required for assignments
in respect of the Facility or any unfunded Commitments if such assignment is to a Person that is not a Lender with a Commitment,
an Affiliate of such Lender or an Approved Fund with respect to such Lender; and

 

(3)         the
consent of each Issuing Bank shall be required for any assignment.

 

(iv)        Assignment
and Assumption. The parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption,
together with a processing and recordation fee of $3,500; provided that the Administrative Agent may, in its sole discretion,
elect to waive such processing and recordation fee in the case of any assignment. The assignee, if it is not a Lender, shall deliver
to the Administrative Agent an Administrative Questionnaire.

 

(v)         No
Assignment to Certain Persons. No such assignment shall be made to (A) the Borrower or any of the Borrower’s Affiliates
or Subsidiaries or (B) to any Defaulting Lender or any of its Subsidiaries, or any Person who, upon becoming a Lender hereunder,
would constitute any of the foregoing Persons described in this clause (B).

 

(vi)        No
Assignment to Natural Persons. No such assignment shall be made to a natural Person.

 

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(vii)       Certain
Additional Payments. In connection with any assignment of rights and obligations of any Defaulting Lender hereunder, no such
assignment shall be effective unless and until, in addition to the other conditions thereto set forth herein, the parties to the
assignment shall make such additional payments to the Administrative Agent in an aggregate amount sufficient, upon distribution
thereof as appropriate (which may be outright payment, purchases by the assignee of participations or subparticipations, or other
compensating actions, including funding, with the consent of the Borrower and the Administrative Agent, the applicable pro
rata share of Loans previously requested but not funded by the Defaulting Lender, to each of which the applicable assignee
and assignor hereby irrevocably consent), to (x) pay and satisfy in full all payment liabilities then owed by such Defaulting Lender
to the Administrative Agent, each Issuing Bank, and each other Lender hereunder (and interest accrued thereon) and (y) acquire
(and fund as appropriate) its full pro rata share of all Loans and participations in Letters of Credit in accordance
with its Applicable Percentage. Notwithstanding the foregoing, in the event that any assignment of rights and obligations of any
Defaulting Lender hereunder shall become effective under Applicable Law without compliance with the provisions of this clause,
then the assignee of such interest shall be deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance
occurs.

 

Subject to acceptance and recording thereof by the Administrative
Agent pursuant to clause (c) of this Section, from and after the effective date specified in each Assignment and Assumption,
the assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Assumption,
have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the
interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of
an Assignment and Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender
shall cease to be a party hereto) but shall continue to be entitled to the benefits of Sections 2.14, 2.16,
2.17 and 9.3 with respect to facts and circumstances occurring prior to the effective date of such assignment; provided,
that except to the extent otherwise expressly agreed by the affected parties, no assignment by a Defaulting Lender will constitute
a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender. Any assignment
or transfer by a Lender of rights or obligations under this Agreement that does not comply with this clause shall be treated for
purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with clause (d)
of this Section.

 

(c)          Register.
The Administrative Agent, acting solely for this purpose as an agent of the Borrower, shall maintain at one of its offices a copy
of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders,
and the Maximum Credit Amount of, and principal amounts (and stated interest) of the Loans owing to, each Lender pursuant to the
terms hereof from time to time (the “Register”). The entries in the Register shall be conclusive absent manifest
error, and the Borrower, the Administrative Agent and the Lenders shall treat each Person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement. The Register shall be available for inspection
by the Borrower and any Lender, at any reasonable time and from time to time upon reasonable prior notice. Upon its receipt of
a duly completed Assignment and Assumption executed by an assigning Lender and an assignee, the assignee’s Administrative
Questionnaire (unless the assignee shall already be a Lender hereunder), the processing and recordation fee referred to in clause (b)
of this Section and any written consent to such assignment required by clause (b) of this Section, the Administrative
Agent shall accept such Assignment and Assumption and record the information contained therein in the Register; provided
that if either the assigning Lender or the assignee shall have failed to make any payment required to be made by it pursuant to
this Agreement, the Administrative Agent shall have no obligation to accept such Assignment and Assumption and record the information
therein in the Register unless and until such payment shall have been made in full, together with all accrued interest thereon.
No assignment shall be effective for purposes of this Agreement unless it has been recorded in the Register as provided in this
paragraph.

 

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(d)          Participations.
Any Lender may at any time, without the consent of, or notice to, the Borrower or the Administrative Agent, sell participations
to any Person (other than a natural Person or the Borrower or any of the Borrower’s Affiliates or Subsidiaries) (each, a
“Participant”) in all or a portion of such Lender’s rights and/or obligations under this Agreement (including
all or a portion of its Commitment and/or the Loans owing to it); provided that (i) such Lender’s obligations under
this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance
of such obligations and (iii) the Borrower, the Administrative Agent, the Issuing Banks and Lenders shall continue to deal solely
and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement. For the avoidance
of doubt, each Lender shall be responsible for the indemnity under Section 2.17(e) with respect to any payments made
by such Lender to its Participant(s).

 

Any agreement or instrument pursuant to
which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement
and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or
instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification
or waiver described in the first proviso to Section 9.2(b) that affects such Participant. The Borrower agrees
that each Participant shall be entitled to the benefits of Sections 2.14, 2.16 and 2.17 (subject to the
requirements and limitations therein, including the requirements under Section 2.17(g) (it being understood that the
documentation required under Section 2.17(g) shall be delivered to the participating Lender)) to the same extent as
if it were a Lender and had acquired its interest by assignment pursuant to clause (b) of this Section; provided
that such Participant (A) agrees to be subject to the provisions of Section 2.20 as if it were an assignee under clause (b)
of this Section and (B) shall not be entitled to receive any greater payment under Section 2.14 or 2.17, with
respect to any participation, than its participating Lender would have been entitled to receive, except to the extent such entitlement
to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation.
Each Lender that sells a participation agrees, at the Borrower’s request and expense, to use reasonable efforts to cooperate
with the Borrower to effect the provisions of Section 2.20(b) with respect to any Participant. To the extent permitted
by Applicable Law, each Participant also shall be entitled to the benefits of Section 9.8 as though it were a Lender;
provided that such Participant agrees to be subject to Section 2.19(b) as though it were a Lender. Each Lender
that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register
on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s
interest in the Loans or other obligations under the Loan Documents (the “Participant Register”); provided
that no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of
any Participant or any information relating to a Participant’s interest in any commitments, loans, letters of credit or its
other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that
such commitment, loan, letter of credit or other obligation is in registered form under Section 5f.103-1(c) of the United States
Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall
treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this
Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, the Administrative Agent (in its capacity as
Administrative Agent) shall have no responsibility for maintaining a Participant Register.

 

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(e)          Certain
Pledges. Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement
to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank, and this
Section shall not apply to any such pledge or assignment of a security interest; provided that no such pledge or assignment
shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a
party hereto.

 

Section 9.5           Survival.
All covenants, agreements, representations and warranties made by the Borrower herein and in the certificates or other instruments
delivered in connection with or pursuant to this Agreement shall be considered to have been relied upon by the other parties hereto
and shall survive the execution and delivery of this Agreement and the making of any Loans and issuance of any Letters of Credit,
regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Administrative Agent,
any Issuing Bank or any Lender may have had notice or knowledge of any Default or incorrect representation or warranty at the time
any credit is extended hereunder, and shall continue in full force and effect until the Termination Date. The provisions of Sections 2.14,
2.16, 2.17, 2.18 and 9.3 and Article VIII shall survive and remain in full force and effect
regardless of the consummation of the transactions contemplated hereby, the repayment of the Obligations, the expiration or termination
of the Letters of Credit and the Commitments or the termination of this Agreement or any provision hereof.

 

Section 9.6           Counterparts;
Integration; Effectiveness; Electronic Execution.

 

(a)          Counterparts;
Integration; Effectiveness. This Agreement may be executed in counterparts (and by different parties hereto in different counterparts),
each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement
and the other Loan Documents, and any separate letter agreements with respect to fees payable to the Administrative Agent, constitute
the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings,
oral or written, relating to the subject matter hereof. Except as provided in Section 4.1, this Agreement shall become
effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts
hereof that, when taken together, bear the signatures of each of the other parties hereto. Delivery of an executed counterpart
of a signature page of this Agreement by telecopy or in electronic (i.e., “pdf” or “tif”) format
shall be effective as delivery of a manually executed counterpart of this Agreement.

 

(b)          Electronic
Execution of Assignments. The words “execution,” “signed,” “signature,” and words of like
import in any Assignment and Assumption shall be deemed to include electronic signatures or the keeping of records in electronic
form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of
a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any Applicable Law, including the
Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or
any other similar state laws based on the Uniform Electronic Transactions Act.

 

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Section 9.7           Severability.
Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability
of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate
such provision in any other jurisdiction.

 

Section 9.8           Right
of Setoff. If an Event of Default shall have occurred and be continuing, each Lender, each Issuing Bank and each of their respective
Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by Applicable Law, to set off
and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held,
and other obligations (in whatever currency) at any time owing, by such Lender, such Issuing Bank or any such Affiliate, to or
for the credit or the account of the Borrower or any other Loan Party against any and all of the obligations of the Borrower or
such Loan Party now or hereafter existing under this Agreement or any other Loan Document to such Lender or such Issuing Bank or
their respective Affiliates, irrespective of whether or not such Lender, Issuing Bank or Affiliate shall have made any demand under
this Agreement or any other Loan Document and although such obligations of the Borrower or such Loan Party may be contingent or
unmatured or are owed to a branch, office or Affiliate of such Lender or such Issuing Bank different from the branch, office or
Affiliate holding such deposit or obligated on such indebtedness; provided that in the event that any Defaulting Lender
shall exercise any such right of setoff, (a) all amounts so set off shall be paid over immediately to the Administrative Agent
for further application in accordance with the provisions of Section 2.22 and, pending such payment, shall be segregated
by such Defaulting Lender from its other funds and deemed held in trust for the benefit of the Administrative Agent, the Issuing
Banks and the Lenders and (b) the Defaulting Lender shall provide promptly to the Administrative Agent a statement describing in
reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised such right of setoff. The rights of
each Lender, each Issuing Bank and their respective Affiliates under this Section are in addition to other rights and remedies
(including other rights of setoff) that such Lender, such Issuing Bank or their respective Affiliates may have. Each Lender and
Issuing Bank agrees to notify the Borrower and the Administrative Agent promptly after any such setoff and application; provided
that the failure to give such notice shall not affect the validity of such setoff and application.

 

Section 9.9           Governing
Law; Jurisdiction; Etc.

 

(a)          Governing
Law. This Agreement and the other Loan Documents and any claim, controversy, dispute or cause of action (whether in contract
or tort or otherwise) based upon, arising out of or relating to this Agreement or any other Loan Document (except, as to any other
Loan Document, as expressly set forth therein) and the transactions contemplated hereby and thereby shall be governed by, and construed
in accordance with, the law of the State of New York.

 

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(b)          Jurisdiction.
The Borrower irrevocably and unconditionally agrees that it will not commence any action, litigation or proceeding of any kind
or description, whether in law or equity, whether in contract or in tort or otherwise, against the Administrative Agent, any Lender,
any Issuing Bank or any Related Party of the foregoing in any way relating to this Agreement or any other Loan Document or the
transactions relating hereto or thereto, in any forum other than the courts of the State of New York sitting in New York County,
and of the United States District Court for the Southern District of New York , and any appellate court from any thereof, and each
of the parties hereto irrevocably and unconditionally submits to the jurisdiction of such courts and agrees that all claims in
respect of any action, litigation or proceeding of any kind or description, whether in law or equity, whether in contract or in
tort or otherwise, in any way relating to this Agreement or any other Loan Document or the transactions relating hereto or thereto
may be heard and determined in such New York State court or, to the fullest extent permitted by Applicable Law, in such federal
court. Each of the parties hereto agrees that a final judgment in any such action, litigation or proceeding shall be conclusive
and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Applicable Law. Nothing in
this Agreement or in any other Loan Document shall affect any right that the Administrative Agent, any Lender or any Issuing Bank
may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against the Borrower,
any other Loan Party or their properties in the courts of any jurisdiction.

 

(c)          Waiver
of Venue. The Borrower irrevocably and unconditionally waives, to the fullest extent permitted by Applicable Law, any objection
that it may now or hereafter have to the laying of venue of any action or proceeding arising out of or relating to this Agreement
or any other Loan Document in any court referred to in clause (b) of this Section. Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by Applicable Law, the defense of an inconvenient forum to the maintenance
of such action or proceeding in any such court.

 

(d)          Service
of Process. Each party hereto irrevocably consents to service of process in the manner provided for notices in Section 9.1.
Nothing in this Agreement will affect the right of any party hereto to serve process in any other manner permitted by Applicable
Law.

 

Section 9.10         Waiver
of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT
MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE,
THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT
AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS,
THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

    	124

    	 

    

 

Section 9.11         Headings.
Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.

 

Section 9.12         Treatment
of Certain Information; Confidentiality.

 

Each of the Administrative Agent, the Lenders
and the Issuing Banks agree to maintain the confidentiality of the Information (as defined below), except that Information may
be disclosed: (a) to its Affiliates and to its Related Parties (it being understood that the Persons to whom such disclosure is
made will be informed of the confidential nature of such Information and instructed to keep such Information confidential); (b)
to the extent required or requested by any regulatory authority purporting to have jurisdiction over such Person or its Related
Parties (including any self-regulatory authority, such as the National Association of Insurance Commissioners); (c) to the extent
required by Applicable Law or by any subpoena or similar legal process; (d) to any other party hereto; (e) in connection with the
exercise of any remedy hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or any
other Loan Document or the enforcement of rights hereunder or thereunder; (f) subject to an agreement containing provisions substantially
the same as those of this Section, to (i) any assignee of or Participant in, or any prospective assignee of or Participant in,
any of its rights and obligations under this Agreement or (ii) any actual or prospective party (or its Related Parties) to any
swap, derivative, credit insurance or other transaction under which payments are to be made by reference to the Borrower and its
obligations, this Agreement or payments hereunder; (g) with the consent of the Borrower; or (h) to the extent such Information
(x) becomes publicly available other than as a result of a breach of this Section or (y) becomes available to the Administrative
Agent, any Lender, any Issuing Bank or any of their respective Affiliates on a nonconfidential basis from a source other than the
Borrower or any Subsidiary.

 

For purposes of this Section 9.12,
“Information” means all information received from the Borrower or any Subsidiary relating to the Borrower or
any Subsidiary or any of their respective businesses, other than any such information that is available to the Administrative Agent,
any Lender or any Issuing Bank on a nonconfidential basis prior to disclosure by the Borrower or any Subsidiary; provided
that, in the case of information received from the Borrower or any Subsidiary after the date hereof, such information is clearly
identified at the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided
in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree
of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

 

Section 9.13         Interest
Rate Limitation. Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to any Loan,
together with all fees, charges and other amounts which are treated as interest on such Loan under Applicable Law (collectively
the “Charges”), shall exceed the maximum lawful rate (the “Maximum Rate”) which may be contracted
for, charged, taken, received or reserved by the Lender holding such Loan in accordance with Applicable Law, the rate of interest
payable in respect of such Loan hereunder, together with all Charges payable in respect thereof, shall be limited to the Maximum
Rate and, to the extent lawful, the interest and Charges that would have been payable in respect of such Loan but were not payable
as a result of the operation of this Section shall be cumulated and the interest and Charges payable to such Lender in respect
of other Loans or periods shall be increased (but not above the Maximum Rate applicable thereto) until such cumulated amount, together
with interest thereon at the Federal Funds Effective Rate to the date of repayment, shall have been received by such
Lender.

 

    	125

    	 

    

 

Section 9.14         PATRIOT
Act. Each Lender that is subject to the requirements of the PATRIOT Act hereby notifies the Borrower that pursuant to the requirements
of the PATRIOT Act, it is required to obtain, verify and record information that identifies the Borrower, which information includes
the name and address of the Borrower and other information that will allow such Lender to identify the Borrower in accordance with
the PATRIOT Act.

 

Section 9.15         Flood
Insurance Provisions. Notwithstanding any provision in this Agreement or any other Loan Document to the contrary, in no event
is any Building (as defined in the applicable Flood Insurance Regulation) or Manufactured (Mobile) Home (as defined in the applicable
Flood Insurance Regulation) included in the definition of “Mortgaged Property” and no Building or Manufactured (Mobile)
Home is hereby encumbered by this Agreement or any other Loan Document. As used herein, “Flood Insurance Regulations”
means (a) the National Flood Insurance Act of 1968 as now or hereafter in effect or any successor statute thereto, (b) the Flood
Disaster Protection Act of 1973 as now or hereafter in effect or any successor statue thereto, (c) the National Flood Insurance
Reform Act of 1994 (amending 42 USC 4001, et seq.), as the same may be amended or recodified from time to time and (d) the Flood
Insurance Reform Act of 2004 and any regulations promulgated thereunder.

 

    	126

    	 

    

 

IN WITNESS WHEREOF, the parties hereto have
caused this Agreement to be duly executed by their respective authorized officers as of the day and year first above written.

 

	 	AMERICAN EAGLE ENERGY CORPORATION, as Borrower
	 	 	 
	 	By:	 
	 	Name: Brad Colby
	 	Title:   Chief Executive Officer
	 	 
	 	SUNTRUST BANK,
	 	as Administrative Agent and Lender
	 	 	 
	 	By:	 
	 	Name: Scott A. Mackey
	 	Title:   Director

 

Signature Page to Credit Agreement

 

    	 

    	 

    

 

SCHEDULE 2.1

 

MAXIMUM CREDIT AMOUNTS

 

	LENDER	 	APPLICABLE
 PERCENTAGE	 	 	MAXIMUM CREDIT
 AMOUNT	 
		 	 	 	 	 	 
	SunTrust Bank	 	 	100	%	 	$	35,000,000	 

 

    	Sch. 2.1-1

    	 

    

 

SCHEDULE 3.4

FINANCIAL CONDITION; NO MATERIAL ADVERSE CHANGE

 

The Loan Parties have obligations under the Permitted Secured
Notes.

 

The Borrower classified all amounts outstanding under its existing
credit facility with Morgan Stanley Capital Group, Inc. as of June 30, 2014 as current liabilities in anticipation of being in
default of certain financial covenants as of the following quarter end.

 

    	Sch. 3.4-1

    	 

    

 

SCHEDULE 3.5

PROPERTIES

 

None.

 

    	Sch. 3.5-1

    	 

    

 

SCHEDULE 3.6

DISCLOSED MATTERS

 

None.

 

    	Sch. 3.6-1

    	 

    

 

SCHEDULE 3.11

INSURANCE

 

The Borrower maintains the following insurance coverages:

 

	Coverage	 	Insurer	 	Policy
    #	 	Expires	 	Insured

    Amount	 	Retention

    Amount
	General & Commercial Liability	 	St. Paul Fire & Marine Insurance Company	 	ZLP-15R09759-13-N4	 	10/8/14	 	$2,000,000
        General

         

        $1.000.000
        Personal Injury
	 	$2,500
	Automotive Liability	 	St. Paul Fire & Marine Insurance Company	 	ZLP-15R09759-13-N4	 	10/8/14	 	$1,000,000 Bodily Injury and Property Damage	 	$500
	Excess Liability	 	St. Paul Fire & Marine Insurance Company	 	ZLP-15R09759-13-N4	 	10/8/14	 	$9,000,000 Umbrella	 	$10,000
	Workers Compensation and Employers’ Liability	 	The Charter Oak Fire Insurance Company	 	HOUB 9D35005 9 13	 	10/8/14	 	$1,000,000 Bodily Injury	 	None
	Operators Extra / Well Control	 	Lloyd’s of London	 	GA035100C	 	10/8/14	 	$20,000,000
        Combined Single Limit

         

         

        $5,000,000
        Care, Custody & Control
	 	$175,000
        for a Drilling Well or

        $125,000
        for a Producing Well

         

        $75,000
        Care / Custody & Control

	Directors & Officers	 	Arch
        Insurance Company

         

        Twin
        City Fire Insurance Company

         

        XL
        Specialty Insurance Company
	 	DOP9300012-00

         

         

        00
        DA 0282788 14

         

         

         

        ELU132966-14
	 	1/20/15	 	$5,000,000
        Primary

         

        $5,000,000
        Excess

         

         

        $5,000,000
        Excess
	 	$200,000

 

    	Sch. 3.11-1

    	 

    

 

SCHEDULE 3.13

SUBSIDIARIES; EQUITY INTERESTS

Part 1 – Subsidiaries:

 

		1)	AMZG, Inc., a Nevada corporation that is wholly-owned by American Eagle Energy Corporation

 

		2)	EERG Energy ULC, an Alberta Unlimited Liability Company that is wholly-owned by American Eagle Energy Corporation.

 

		3)	AEE Canada Inc., an Alberta (Canada) Corporation that is wholly-owned by AMZG, Inc.

 

 

Part 2 – Equity Interests:

 

		1)	The Borrower owns 30,640 shares of common stock of Crescent Point Energy Corp. as of July 31, 2014. The number of shares changes
on a monthly basis pursuant to an auto-reinvestment of dividends program.

 

		2)	American Eagle Energy Corporation and AMZG, Inc. each own 33,333 shares of common stock of Powder Mountain Energy LTD.

 

    	Sch. 3.13-1

    	 

    

 

SCHEDULE 3.19

LABOR MATTERS

 

None.

 

    	Sch. 3.19-1

    	 

    

 

SCHEDULE 3.20

MATERIAL AGREEMENTS

 

The Borrower has made its material agreements available to the
Administrative Agent through its filings with the SEC.

 

    	Sch. 3.20-1

    	 

    

 

SCHEDULE 3.24

GAS IMBALANCES

 

None.

 

    	Sch. 3.24-1

    	 

    

 

SCHEDULE 3.25

MARKETING CONTRACTS

 

		1)	Lease Crude Oil Purchase Agreement dated July 1, 2013, by and between Power Energy Partners LP and American Eagle Energy Corporation
contains a term through December 31, 2015.

 

		2)	Gas Gathering, Processing and Purchase Agreement dated May 16, 2013, by and between USG Midstream Bakken I, LLC and American
Eagle Energy Corporation contains a term through December 31, 2023.

 

    	Sch. 3.25-1

    	 

    

 

SCHEDULE 3.26

HEDGING AGREEMENTS

 

The Borrower is a party to the following Hedging Agreements
that will be terminated in connection the payment of the Debt to be Repaid:

 

		1)	Commodity Swap dated August 20, 2013, by and between Morgan Stanley Capital Group Inc. and American Eagle Energy Corporation.

 

	General Terms:	 	 
	Effective Date:	 	August 19, 2013
	Termination Date:	 	August 31, 2018
	Commodity:	 	As per Commodity Reference Price
	Total Notional Quantity:	 	740,897.794222 Barrels
	Notional Quantity:	 	Please refer to Appendix I
	Calculation Period:	 	The Term of the Transaction
	Payment Date(s):	 	5 Business Days following the last day of each Calculation Period
	Business Day:	 	New York
	 	 	 
	Fixed Amount Details:	 	 
	Fixed Price Payer:	 	Morgan Stanley Capital Group Inc.
	Fixed Price:	 	Please refer to Appendix I
	 	 	 
	Floating Amount Details:	 	 
	Floating Price Payer:	 	American Eagle Energy Corporation
	Commodity Reference Price:	 	OIL-WTI-NYMEX
	Floating Price:	 	The average of the first nearby NYMEX WTI Crude Oil Futures Closing Settlement Price(s) for each successive day of the Calculation Period during which such prices are quoted.
	Pricing Date(s):	 	Each calendar day from and including August 19, 2013 to and including August 31, 2018.
	Rounding:	 	The Floating Price will be rounded to 3 decimal places.
	Calculation Agent:	 	As state in the ISDA Master Agreement dated August 19, 2013

 

    	Sch. 3.26-1

    	 

    

 

Appendix I to Commodity
Swap dated August 20, 2013

 

	Calendar Month	 	Notional Quantity
 (Barrel)	 	 	Fixe Price 

(USD)	 
	August 19, 2013 - August 31, 2013	 	 	13,507.833625	 	 	$	106.37	 
	Sep-13	 	 	27,749.021929	 	 	$	106.07	 
	Oct-13	 	 	26,353.598630	 	 	$	105.13	 
	Nov-13	 	 	23,470.946659	 	 	$	103.87	 
	Dec-13	 	 	22,817.700927	 	 	$	102.46	 
	Jan-14	 	 	21,469.429859	 	 	$	99.82	 
	Feb-14	 	 	18,367.169025	 	 	$	98.71	 
	Mar-14	 	 	19,304.821296	 	 	$	97.60	 
	Apr-14	 	 	17,792.518581	 	 	$	96.69	 
	May-14	 	 	17,612.758046	 	 	$	95.74	 
	Jun-14	 	 	16,464.273922	 	 	$	94.90	 
	Jul-14	 	 	16,338.733722	 	 	$	94.11	 
	Aug-14	 	 	15,841.401770	 	 	$	93.45	 
	Sep-14	 	 	14,698.226480	 	 	$	92.87	 
	Oct-14	 	 	14,781.812711	 	 	$	92.27	 
	Nov-14	 	 	13,735.401921	 	 	$	91.73	 
	Dec-14	 	 	13,849.561138	 	 	$	91.01	 
	Jan-15	 	 	13,448.594897	 	 	$	89.38	 
	Feb-15	 	 	11,787.634770	 	 	$	88.83	 
	Mar-15	 	 	12,651.671249	 	 	$	88.23	 
	Apr-15	 	 	11,994.866974	 	 	$	87.75	 
	May-15	 	 	12,152.781164	 	 	$	87.27	 
	Jun-15	 	 	11,539.701631	 	 	$	86.76	 
	Jul-15	 	 	11,708.338011	 	 	$	86.25	 
	Aug-15	 	 	11,500.271013	 	 	$	85.86	 
	Sep-15	 	 	10,941.207623	 	 	$	85.53	 
	Oct-15	 	 	11,121.061333	 	 	$	85.27	 
	Nov-15	 	 	10,591.805940	 	 	$	85.04	 
	Dec-15	 	 	10,776.755091	 	 	$	84.58	 
	Jan-16	 	 	10,613.491058	 	 	$	83.59	 
	Feb-16	 	 	9,787.267797	 	 	$	83.23	 
	Mar-16	 	 	10,317.298256	 	 	$	82.80	 
	Apr-16	 	 	9,850.090994	 	 	$	82.44	 
	May-16	 	 	10,040.481087	 	 	$	82.16	 
	Jun-16	 	 	9,590.676061	 	 	$	81.86	 
	Jul-16	 	 	9,785.151894	 	 	$	81.64	 
	Aug-16	 	 	9,662.561302	 	 	$	81.46	 
	Sep-16	 	 	9,238.329041	 	 	$	81.31	 
	Oct-16	 	 	9,434.056585	 	 	$	81.21	 
	Nov-16	 	 	9,379.258816	 	 	$	81.11	 
	Dec-16	 	 	9,557.211433	 	 	$	80.91	 
	Jan-17	 	 	9,456.437876	 	 	$	80.47	 
	Feb-17	 	 	8,448.336160	 	 	$	80.30	 
	Mar-17	 	 	9,259.623297	 	 	$	80.12	 
	Apr-17	 	 	8,869.730284	 	 	$	79.96	 
	May-17	 	 	9,073.943945	 	 	$	79.79	 
	Jun-17	 	 	8,695.283520	 	 	$	79.60	 
	Jul-17	 	 	8,898.837002	 	 	$	79.46	 
	Aug-17	 	 	8,813.581485	 	 	$	79.35	 
	Sep-17	 	 	8,450.321743	 	 	$	79.24	 
	Oct-17	 	 	8,652.610282	 	 	$	79.15	 
	Nov-17	 	 	8,281.293078	 	 	$	79.05	 
	Dec-17	 	 	8,461.762775	 	 	$	78.86	 
	Jan-18	 	 	8,387.519630	 	 	$	78.39	 
	Feb-18	 	 	7,517.353965	 	 	$	78.23	 
	Mar-18	 	 	8,251.904913	 	 	$	78.07	 
	Apr-18	 	 	7,920.159506	 	 	$	77.95	 
	May-18	 	 	8,118.470735	 	 	$	77.84	 
	Jun-18	 	 	7,794.242304	 	 	$	77.74	 
	Jul-18	 	 	7,991.089408	 	 	$	77.66	 
	Aug-18	 	 	7,928.518053	 	 	$	77.58	 

 

 

    	Sch. 3.26-2

    	 

    

 

		2)	Commodity Swap dated October 3, 2013, by and between Morgan Stanley Capital Group Inc. and American Eagle Energy Corporation.

 

	General Terms:	 	 
	Trade Date:	 	October 2, 2013
	Effective Date:	 	October 1, 2013
	Termination Date:	 	August 31, 2018
	Commodity:	 	As per Commodity Reference Price
	Total Notional Quantity:	 	592,391.902893 Barrels
	Notional Quantity:	 	Please refer to Appendix I
	Calculation Period:	 	Monthly during the Term of the Transaction.
	Payment Date(s):	 	5 Business Days following the last day of each Calculation Period
	Business Day:	 	New York
	 	 	 
	Fixed Amount Details:	 	 
	Fixed Price Payer:	 	Morgan Stanley Capital Group Inc.
	Fixed Price:	 	Please refer to Appendix I
	 	 	 
	Floating Amount Details:	 	 
	Floating Price Payer:	 	American Eagle Energy Corporation
	Commodity Reference Price:	 	OIL-WTI-NYMEX
	Floating Price:	 	The average of the first nearby NYMEX WTI Crude Oil Futures Closing Settlement Price(s) for each successive day of the Calculation Period during which such prices are quoted.
	Pricing Date(s):	 	Each calendar day from and including October 1, 2013 to and including August 31, 2018.

 

    	Sch. 3.26-3

    	 

    

 

	Rounding:	 	The Floating Price will be rounded to 3 decimal places.
	Calculation Agent:	 	As state in the ISDA Master Agreement dated August 19, 2013 as amended and supplemented.

 

Appendix I to Commodity Swap dated
October 3, 2013

 

	Calendar Month	 	Notional Quantity

 (Barrel)	 	 	Fixe Price

 (USD)	 
	Oct-13	 	 	17,185.234086	 	 	$	103.00	 
	Nov-13	 	 	16,047.211197	 	 	$	102.41	 
	Dec-13	 	 	15,749.918300	 	 	$	101.43	 
	Jan-14	 	 	15,183.017540	 	 	$	99.63	 
	Feb-14	 	 	13,340.643570	 	 	$	98.63	 
	Mar-14	 	 	14,434.662768	 	 	$	97.58	 
	Apr-14	 	 	13,664.013488	 	 	$	96.68	 
	May-14	 	 	13,815.802525	 	 	$	95.74	 
	Jun-14	 	 	12,958.339767	 	 	$	94.90	 
	Jul-14	 	 	13,168.779710	 	 	$	94.11	 
	Aug-14	 	 	12,804.005630	 	 	$	93.42	 
	Sep-14	 	 	12,305.029350	 	 	$	92.79	 
	Oct-14	 	 	12,403.483260	 	 	$	92.16	 
	Nov-14	 	 	11,980.564298	 	 	$	91.62	 
	Dec-14	 	 	12,104.017527	 	 	$	90.91	 
	Jan-15	 	 	11,936.541258	 	 	$	89.68	 
	Feb-15	 	 	10,692.339244	 	 	$	89.14	 
	Mar-15	 	 	11,787.548560	 	 	$	88.51	 
	Apr-15	 	 	11,189.857776	 	 	$	87.99	 
	May-15	 	 	11,350.516131	 	 	$	87.46	 
	Jun-15	 	 	10,789.666478	 	 	$	86.93	 
	Jul-15	 	 	10,958.431914	 	 	$	86.42	 
	Aug-15	 	 	10,774.015198	 	 	$	86.03	 
	Sep-15	 	 	10,259.291026	 	 	$	85.71	 
	Oct-15	 	 	10,436.537337	 	 	$	85.44	 
	Nov-15	 	 	9,947.558881	 	 	$	85.18	 
	Dec-15	 	 	10,128.629877	 	 	$	84.71	 
	Jan-16	 	 	9,982.142694	 	 	$	83.48	 
	Feb-16	 	 	9,210.937544	 	 	$	83.11	 
	Mar-16	 	 	9,715.613588	 	 	$	82.72	 
	Apr-16	 	 	9,279.463474	 	 	$	82.40	 
	May-16	 	 	9,465.342676	 	 	$	82.12	 
	Jun-16	 	 	9,045.725583	 	 	$	81.80	 
	Jul-16	 	 	9,233.442665	 	 	$	81.56	 
	Aug-16	 	 	9,121.867776	 	 	$	81.39	 
	Sep-16	 	 	8,725.057491	 	 	$	81.23	 
	Oct-16	 	 	8,913.502960	 	 	$	81.12	 
	Nov-16	 	 	8,087.066777	 	 	$	81.01	 
	Dec-16	 	 	8,256.718324	 	 	$	80.80	 
	Jan-17	 	 	8,174.458535	 	 	$	80.10	 
	Feb-17	 	 	7,302.360937	 	 	$	79.92	 
	Mar-17	 	 	8,005.387813	 	 	$	79.70	 
	Apr-17	 	 	7,670.002775	 	 	$	79.51	 
	May-17	 	 	7,848.255823	 	 	$	79.32	 
	Jun-17	 	 	7,522.270781	 	 	$	79.14	 
	Jul-17	 	 	7,699.862887	 	 	$	79.00	 
	Aug-17	 	 	7,627.541970	 	 	$	78.90	 
	Sep-17	 	 	7,314.477645	 	 	$	78.82	 
	Oct-17	 	 	7,490.866355	 	 	$	78.75	 
	Nov-17	 	 	7,180.362220	 	 	$	78.68	 
	Dec-17	 	 	7,349.516904	 	 	$	78.56	 
	Jan-18	 	 	6,846.750000	 	 	$	78.44	 
	Feb-18	 	 	6,846.750000	 	 	$	78.32	 
	Mar-18	 	 	6,846.750000	 	 	$	78.20	 
	Apr-18	 	 	6,846.750000	 	 	$	78.10	 
	May-18	 	 	6,846.750000	 	 	$	77.99	 
	Jun-18	 	 	6,846.750000	 	 	$	77.88	 
	Jul-18	 	 	6,846.750000	 	 	$	77.80	 
	Aug-18	 	 	6,846.750000	 	 	$	77.72	 

 

 

    	Sch. 3.26-4

    	 

    

 

		3)	Commodity Swap dated May 14, 2014, by and between Morgan Stanley Capital Group Inc. and American Eagle Energy Corporation.

 

	General Terms:	 	 
	Trade Date:	 	May 13, 2014
	Effective Date:	 	June 1, 2014
	Termination Date:	 	December 31, 2018
	Commodity:	 	As per Commodity Reference Price
	Total Notional Quantity:	 	171,200 Barrels
	Notional Quantity:	 	Refer to Appendix I
	Calculation Period:	 	Refer to Appendix I
	Payment Date(s):	 	Refer to Appendix I, subject to adjustment in accordance with the Following Business Day Convention.
	Business Day:	 	New York
	 	 	 
	Fixed Amount Details:	 	 
	Fixed Price Payer:	 	Morgan Stanley Capital Group Inc.
	Fixed Price:	 	Please refer to Appendix I

 

    	Sch. 3.26-5

    	 

    

 

	Floating Amount Details:	 	 
	Floating Price Payer:	 	American Eagle Energy Corporation
	Commodity Reference Price:	 	OIL-WTI-NYMEX
	Floating Price:	 	The average of the first nearby NYMEX WTI Crude Oil Futures Closing Settlement Price(s) for each successive day of the Calculation Period during which such prices are quoted.
	Pricing Date(s):	 	Refer to Appendix I
	Rounding:	 	The Floating Price will be rounded to 3 decimal places.
	Calculation Agent:	 	As state in the ISDA Master Agreement dated August 19, 2013 as amended and supplemented.

 

Appendix I to Commodity Swap dated
May 14, 2014

 

	Calculation Period	 	Notional
 Quantity
 (Barrel)	 	 	Fixe Price
 (USD per
 Barrel)	 	 	Payment Date
	June 01, 2014- June 30, 2014	 	 	24,000	 	 	 	100.08	 	 	July 8, 2014
	July 01, 2014 - July 31, 2014	 	 	24,800	 	 	 	99.00	 	 	August 07, 2014
	August 01, 2014 - August 31, 2014	 	 	24,800	 	 	 	98.10	 	 	September 8, 2014
	September 01, 2014 - September 30, 2014	 	 	24,000	 	 	 	97.20	 	 	October 7, 2014
	October 01, 2014 - October 31, 2014	 	 	24,800	 	 	 	96.20	 	 	November 7, 2014
	November 01, 2014 - November 30, 2014	 	 	24,000	 	 	 	95.40	 	 	December 5, 2015
	December 01, 2014 - December 31, 2014	 	 	24,800	 	 	 	94.44	 	 	January 8, 2015

 

    	Sch. 3.26-6

    	 

    

 

SCHEDULE 3.27

LOCATION OF BUSINESS AND OFFICES

 

		1)	American Eagle Energy Corporation, a Nevada corporation, with an entity number C17822-2003 and a principal place of business
and chief executive offices both located at 2549 W. Main Street, Suite 202, Littleton, CO 80120.

 

		2)	AMZG, Inc., a Nevada Corporation, with an entity number E0181062007-5 and a principal place of business and chief executive
offices both located at 2549 W. Main Street, Suite 202, Littleton, CO 80120.

 

    	Sch. 3.27-1

    	 

    

 

SCHEDULE 3.28

DEPOSIT AND DISBURSEMENT ACCOUNTS

 

		1)	The Borrower maintains the following accounts at Key Bank, whose address is PO Box 93885, Cleveland, OH 44101-5885 and phone
number is (800) 821-2829:

 

		·	American Eagle Energy Corporation Payables account (Account #765070012958)

 

		·	American Eagle Energy Corporation Revenue account (Account #765071003428)

 

		·	American Eagle Energy Corporation Money Market savings account (Account #765070014095)

 

		·	AMZG, Inc. Payables account (Account #765071002552)

 

		·	EERG Energy ULC Payables account (Account #765071001042)

 

		2)	The Borrower maintains the following account at Wells Fargo Advisors, whose address is 13355 Noel Road, Suite 1500, Dallas,
TX 75240 and phone number is (972) 341-1067:

 

		·	American Eagle Energy Corporation (Account #1592-9837)

 

		3)	The Borrower maintains the following account at Royal Bank of Canada, whose address is 180 Wellington Street W-5th Floor, Toronto,
ON M5J 1J1 and phone number is (800) 769-2553:

 

		·	EERG Energy ULC checking account (Account #09591 103-921-3)

 

    	Sch. 3.28-1

    	 

    

 

SCHEDULE 4.1

DEBTS TO BE REPAID

 

The Borrower is indebted in the following amounts to Morgan
Stanley Capital Group Inc., which will be repaid:

 

	Principal outstanding Tranche A	 	$	108,000,000	 
	Principal outstanding Tranche B	 	 	2,160,000	 
	Prepayment premium	 	 	3,304,800	 
	Accrued Interest	 	 	873,810	 
	Total	 	$	114,338,610	 

 

In addition, the Borrower will pay (i) certain amounts to Morgan
Stanley Capital Group, Inc. in connection with certain hedge obligations and (ii) certain fees and expenses of counsel to Morgan
Stanley Capital Group, Inc.

 

    	Sch. 4.1-1

    	 

    

 

SCHEDULE 6.2

EXISTING INDEBTEDNESS

 

None.

 

    	Sch. 6.2-1

    	 

    

 

SCHEDULE 6.3

EXISTING LIENS

 

Lamb Rock Excavation, Inc. has filed a UCC-1 Financing in Real
Estate and UCC Filing office for Divide County, North Dakota, naming the Borrower as Debtor and describing aggregate products as
the collateral. The Borrower has satisfied all underlying obligations to Lamb Rock Excavation, Inc. with respect to which the UCC-1
was filed, and requested that Lamb Rock file a UCC-3 Termination Statement.

 

    	Sch. 6.3-1

    	 

    

 

SCHEDULE 6.6

EXISTING INVESTMENTS

 

		1)	The Borrower owns 30,640 shares of common stock of Crescent Point Energy Corp. as of July 31, 2014. The number of shares changes
on a monthly basis pursuant to an auto-reinvestment of dividends program.

 

		2)	American Eagle Energy Corporation and AMZG, Inc. each own 33,333 shares of common stock of Powder Mountain Energy LTD.

 

    	Sch. 6.6-1

    	 

    

 

SCHEDULE 6.9

TRANSACTIONS WITH AFFILIATES

 

		1)	The Borrower is under contract through February 2016 to sell 100% of its oil, gas and liquids production to Power Energy Partners
LP (“Power Energy”). As of June 30, 2014, Power Energy holds 2,250,000 shares of American Eagle Energy Corporation’s
common stock.

 

		2)	The Borrower routinely obtains legal services from a firm for whom one of its directors serves as a principal. Fees paid this
firm approximated $33,000 for the six-month period ended June 30, 2014 and $37,000 for the year ended December 31, 2013, respectively.

 

		3)	The Borrower receives monthly geological consulting services from Synergy Energy Resources LLC (“Synergy”). One
of the Borrower’s current directors and one current officer own material ownership interests in Synergy. The Borrower incurred
approximately $84,000 of consulting expenses from Synergy during the six-month period ended June 30, 2014 and $168,000 for the
year ended December 31, 2013, respectively. The Borrower terminated its consulting agreement with Synergy on June 30, 2014.

 

		4)	The Borrower’s Chairman of the Board owns overriding royalty interests in certain of the Borrower’s operated wells.
The overriding royalty interests were obtained prior the Borrower’s acquisition of AEE, Inc. in December 2011. Royalties
paid to this individual totaled approximately $252,000 for the six-month period ended June 30, 2014 and $608,000 for the year ended
December 31, 2013, respectively.

 

		5)	The Borrower’s Chief Operating Officer owns overriding royalty interests in certain of the Borrower’s operated
wells. The overriding royalty interests were obtained prior the Borrower’s acquisition of AEE, Inc. in December 2011. Royalties
paid to this individual totaled approximately $304,000 for the six-month period ended June 30, 2014 and $540,000 for the year ended
December 31, 2013, respectively.

 

    	Sch. 6.9-1

    	 

    

 

SCHEDULE 6.10

CHANGES IN NATURE OF BUSINESS

 

The Borrower owns the following Subsidiaries that are organized
under the laws of a jurisdiction outside the United States:

 

		1)	EERG Energy ULC, an Alberta Unlimited Liability Company that is wholly-owned by American Eagle Energy Corporation.

 

		2)	AEE Canada Inc., an Alberta (Canada) Corporation that is wholly-owned by AMZG, Inc.

 

    	Sch. 6.10-1

    	 

    

 

SCHEDULE 6.11

RESTRICTIVE AGREEMENTS

 

The Borrower is a party to certain restrictive agreements Morgan
Stanley Capital Group, Inc that will be terminated in connection the payment of the Debt to be Repaid.

 

    	Sch. 6.11-1

    	 

    

 

EXHIBIT A

 

[FORM OF]

REVOLVING NOTE

 

[______________], 20[__]

 

FOR VALUE RECEIVED, the undersigned, AMERICAN
EAGLE ENERGY CORPORATION (the “Borrower”), hereby promises to pay [________________] (together with its successors
and permitted assigns, the “Lender”) the aggregate unpaid principal amount of all Loans made by the Lender to
the Borrower pursuant to the Credit Agreement dated as of August 27, 2014, among the Borrower, various financial institutions and
SUNTRUST BANK, as Administrative Agent (as amended, restated or otherwise modified from time to time, the “Credit Agreement”),
on the dates, in the amounts and at the place provided in the Credit Agreement. The Borrower further promises to pay interest on
the unpaid principal amount of the Loans evidenced hereby from time to time at the rates, on the dates, and otherwise as provided
in the Credit Agreement.

 

The Lender is authorized to record the amount
and the date on which each Loan is made and each payment of principal with respect thereto in its records; provided that
any failure to so record such information shall not in any manner affect any obligation of the Borrower under the Credit Agreement
or this Revolving Note.

 

This Revolving Note may only be assigned
as provided in the Credit Agreement.

 

This Revolving Note is one of the Revolving
Notes referred to in, and is entitled to the benefits of, the Credit Agreement. Capitalized terms used but not defined herein have
the respective meanings set forth in the Credit Agreement.

 

THIS REVOLVING NOTE IS GOVERNED BY THE LAWS
OF THE STATE OF NEW YORK.

  

    	A-1

    	 

    

 

IN WITNESS WHEREOF, the Borrower has caused
this Revolving Note to be duly executed and delivered as of the day and year first above written.

 

	 	AMERICAN EAGLE ENERGY CORPORATION
	 	 
	 	By:	 

	 	Name Printed:	 

	 	Title:	 

 

    	A-2

    	 

    

 

EXHIBIT B

 

[FORM OF]

BORROWING REQUEST

 

[                   ],
20[    ]

 

AMERICAN EAGLE ENERGY
CORPORATION, a Nevada corporation (the “Borrower”), pursuant to Section 2.3 of the Credit Agreement dated
as of August 27, 2014, (together with all amendments, restatements,
supplements or other modifications thereto, the “Credit Agreement”), among the Borrower, SUNTRUST BANK, as Administrative
Agent and the other agents and lenders (the “Lenders”) which are or become parties thereto (unless otherwise
defined herein, each capitalized term used herein is defined in the Credit Agreement), hereby requests a Borrowing as follows:

 

(i)          Aggregate
amount of the requested Borrowing is $[                   ];

 

(ii)         Date
of such Borrowing is [                   ],
20[    ];

 

(iii)        Requested
Borrowing is to be [an ABR Borrowing] [a Eurodollar Borrowing];

 

(iv)        In
the case of a Eurodollar Borrowing, the initial Interest Period applicable thereto is [                   ];

 

(v)         Amount
of Borrowing Base in effect on the date hereof is $[                   ];

 

(vi)        Total
Revolving Credit Exposures on the date hereof (i.e., outstanding principal amount of Loans and total LC Exposure) is $[                   ];

 

(vii)       Pro
forma total Credit Exposures (giving effect to the requested Borrowing) is $[                   ];
and

 

(viii)      Location
and number of the Borrower’s account to which funds are to be disbursed, which shall comply with the requirements of Section
2.3 of the Credit Agreement, is as follows:

 

[                                            ]

[                                            ]

[                                            ]

[                                            ]

[                                            ]

 

    	B-1

    	 

    

 

The undersigned certifies
that he/she is the [                ] of the Borrower,
and that as such he/she is authorized to execute this certificate on behalf of the Borrower. The undersigned further certifies,
represents and warrants on behalf of the Borrower that the Borrower is entitled to receive the requested Borrowing under the terms
and conditions of the Credit Agreement.

 

	 	AMERICAN EAGLE ENERGY CORPORATION
	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 

 

    	B-2

    	 

    

 

EXHIBIT C

 

FORM OF

COMPLIANCE CERTIFICATE

  

The undersigned hereby
certifies that he/she is the [          ]
of AMERICAN EAGLE ENERGY CORPORATION, a Nevada corporation (the
“Borrower”), and that as such he/she is authorized to execute this certificate on behalf of the Borrower. With
reference to the Credit Agreement dated as of August 27, 2014,
(together with all amendments, restatements, supplements or other modifications thereto being the “Agreement”),
among the Borrower, SUNTRUST BANK, as Administrative Agent, and the other agents and lenders (the “Lenders”)
which are or become a party thereto, and such Lenders, the undersigned represents and warrants as follows (each capitalized term
used herein having the same meaning given to it in the Agreement unless otherwise specified):

 

(a)          There
exists no Default or Event of Default [or specify Default and describe].

 

(b)          Attached
hereto are the detailed computations necessary to determine whether the Borrower is in compliance with Section 6.1
as of the end of the [fiscal quarter][fiscal year] ending [          ].

 

(c)          Attached
hereto are the detailed comparisons of the aggregate notional volumes of all Hedging Agreements of the Borrower and each Restricted
Subsidiary, which were in effect during the most recently ended [fiscal quarter] [fiscal year] (other than basis differential Hedgings)
and the actual production volumes for each of natural gas and crude oil during such period, and it is hereby certified that the
hedged volumes for each of natural gas and crude oil did not exceed 100% of actual production or if such hedged volumes did exceed
actual production, the amount of such excess is specified below.

 

(d)          Check
one:

 

		 ̈	There has been no change in GAAP or in the application thereof since the date of the most recently
delivered audited financial statement.

 

		 ̈	There has been a change in GAAP or the application thereof since the date of the most recently
delivered audited financial statements and the effect of such change is specified on the financial statements accompanying this
certificate.

 

    	C-1

    	 

    

 

EXECUTED AND DELIVERED
this [          ]
day of [          ].

 

	 	American Eagle Energy Corporation
	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 

 

    	C-2

    	 

    

 

EXHIBIT D

 

FORM OF

ASSIGNMENT AND ASSUMPTION

 

This Assignment and Assumption (the “Assignment
and Assumption”) is dated as of the Assignment Effective Date set forth below and is entered into by and between [the][each]1
Assignor identified in item 1 below ([the][each, an] “Assignor”) and [the][each]2
Assignee identified in item 2 below ([the][each, an] “Assignee”). [It is understood and agreed that
the rights and obligations of [the Assignors][the Assignees]3
hereunder are several and not joint.]4 Capitalized terms
used but not defined herein shall have the meanings given to them in the Credit Agreement identified below (as amended, the “Credit
Agreement”), receipt of a copy of which is hereby acknowledged by [the][each] Assignee. The Standard Terms and Conditions
set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this
Assignment and Assumption as if set forth herein in full.

 

For an agreed consideration, [the][each]
Assignor hereby irrevocably sells and assigns to [the Assignee][the respective Assignees], and [the][each] Assignee hereby irrevocably
purchases and assumes from [the Assignor][the respective Assignors], subject to and in accordance with the Standard Terms and Conditions
and the Credit Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below (i) all of [the Assignor’s][the
respective Assignors’] rights and obligations in [its capacity as a Lender][their respective capacities as Lenders] under
the Credit Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and
percentage interest identified below of all of such outstanding rights and obligations of [the Assignor][the respective Assignors]
under the respective facilities identified below (including without limitation any letters of credit and guarantees included in
such facilities) and (ii) to the extent permitted to be assigned under Applicable Law, all claims, suits, causes of action and
any other right of [the Assignor (in its capacity as a Lender)][the respective Assignors (in their respective capacities as Lenders)]
against any Person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or
instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the
foregoing, including, but not limited to, contract claims, tort claims, malpractice claims, statutory claims and all other claims
at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights
and obligations sold and assigned by [the][any] Assignor to [the][any] Assignee pursuant to clauses (i) and (ii)
above being referred to herein collectively as [the][an] “Assigned Interest”). Each such sale and assignment
is without recourse to [the][any] Assignor and, except as expressly provided in this Assignment and Assumption, without representation
or warranty by [the][any] Assignor.

 

 

 

1         For
bracketed language here and elsewhere in this form relating to the Assignor(s), if the assignment is from a single Assignor,
choose the first bracketed language. If the assignment is from multiple Assignors, choose the second bracketed
language.

2         For
bracketed language here and elsewhere in this form relating to the Assignee(s), if the assignment is to a single Assignee, choose
the first bracketed language. If the assignment is to multiple Assignees, choose the second bracketed language.

3         Select
as appropriate.

4         Include
bracketed language if there are either multiple Assignors or multiple Assignees.

 

    	D-1

    	 

    

 

1.          Assignor[s]:                  ________________________________

 

______________________________

[Assignor [is] [is not] a Defaulting Lender]

 

2.          Assignee[s]:                  ______________________________

 

______________________________

[for each Assignee, indicate [Affiliate][Approved
Fund] of [identify Lender]

 

3.          Borrower(s):                   ______________________________

 

4.          Administrative
Agent:  ______________________, as the administrative agent under the Credit Agreement

 

5.          Credit
Agreement:The Credit Agreement dated as of [__________] among AMERICAN EAGLE ENERGY CORPORATION, the Lenders that are parties
thereto, SUNTRUST BANK, as Administrative Agent, and the other agents that are parties thereto.

 

6.          Assigned
Interest[s]:

 

	Assignor[s]5	 	Assignee[s]6	 	Aggregate Amount 
 of Commitment/Loans
 for all Lenders7	 	 	Amount of
 Commitment/Loans
 Assigned8	 	 	Percentage
 Assigned of
 Commitment/
 Loans8	 	 	CUSIP
 Number	 
	 	 		 	$		 	 	$		 	 	 		%	 	 	  	 
		 		 	$		 	 	$		 	 	 		%	 	 		 
		 	 	 	$	  	 	 	$	   	 	 	 	   	%	 	 		 

 

[7.          Trade
Date:                          ______________]9

 

 

 

5       List
each Assignor, as appropriate.

6       List
each Assignee, as appropriate.

7       Amount
to be adjusted by the counterparties to take into account any payments or prepayments made between the Trade Date and the Assignment
Effective Date.

8       Set
forth, to at least 9 decimals, as a percentage of the Commitment/Loans of all Lenders thereunder.

9       To
be completed if the Assignor(s) and the Assignee(s) intend that the minimum assignment amount is to be determined as of the Trade
Date.

 

    	D-2

    	 

    

 

Assignment Effective Date: _____________
___, 20___ [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER
THEREFOR.]

 

The terms set forth in this Assignment and
Assumption are hereby agreed to:

 

	 	ASSIGNOR[S]10
	 	[NAME OF ASSIGNOR]
	 	 	 
	 	By:	 
	 	 	Title:
	 	 
	 	[NAME OF ASSIGNOR]
	 	 	 
	 	By:	 
	 	 	Title:
	 	 
	 	ASSIGNEE[S]11
	 	[NAME OF ASSIGNEE]
	 	 	 
	 	By:	 
	 	 	Title:
	 	 
	 	[NAME OF ASSIGNEE]
	 	 	 
	 	By:	 
	 	 	Title:

 

 

 

10        Add
additional signature blocks as needed. Include both Fund/Pension Plan and manager making the trade (if applicable).

11        Add
additional signature blocks as needed. Include both Fund/Pension Plan and manager making the trade (if applicable).

 

    	D-3

    	 

    

 

	[Consented to and]12 Accepted:	 
	 	 
	SUNTRUST BANK, as	 
	Administrative Agent	 
	 	 	 
	By:	 	 
	Title:	 
	 	 
	[Consented to:]13	 
	 	 
	[NAME OF RELEVANT PARTY]	 
	 	 	 
	By:	 	 
	Title:	 

 

 

 

12         To
be added only if the consent of the Administrative Agent is required by the terms of the Credit Agreement.

13         To
be added only if the consent of the Borrower and/or other parties (e.g., Issuing Bank) is required by the terms of the Credit
Agreement.

 

    	D-4

    	 

    

 

ANNEX 1

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

 

1.          Representations
and Warranties.

 

1.1           Assignor[s].
[The][Each] Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of [the][the relevant] Assigned
Interest, (ii) [the][such] Assigned Interest is free and clear of any lien, encumbrance or other adverse claim, (iii) it has full
power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate
the transactions contemplated hereby and (iv) it is [not] a Defaulting Lender; and (b) assumes no responsibility with respect to
(i) any statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Document,
(ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any Collateral
thereunder, (iii) the financial condition of the Borrower, any of its Subsidiaries or Affiliates or any other Person obligated
in respect of any Loan Document or (iv) the performance or observance by the Borrower, any of its Subsidiaries or Affiliates or
any other Person of any of their respective obligations under any Loan Document.

 

1.2.          Assignee[s].
[The][Each] Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary,
to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and to become a Lender
under the Credit Agreement, (ii) it meets all the requirements to be an assignee under Section 9.4(b)(iii), (v)
and (vi) of the Credit Agreement (subject to such consents, if any, as may be required under Section 9.4(b)(iii)
of the Credit Agreement), (iii) from and after the Assignment Effective Date, it shall be bound by the provisions of the Credit
Agreement as a Lender thereunder and, to the extent of [the][the relevant] Assigned Interest, shall have the obligations of a Lender
thereunder, (iv) it is sophisticated with respect to decisions to acquire assets of the type represented by the Assigned Interest,
and either it, or the Person exercising discretion in making its decision to acquire the Assigned Interest, is experienced in acquiring
assets of such type, (v) it has received a copy of the Credit Agreement, and has received or has been accorded the opportunity
to receive copies of the most recent financial statements delivered pursuant to Section 5.1 thereof, as applicable,
and such other documents and information as it deems appropriate to make its own credit analysis and decision to enter into this
Assignment and Assumption and to purchase [the][such] Assigned Interest, (vi) it has, independently and without reliance upon the
Administrative Agent or any other Lender and, based on such documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Assignment and Assumption and to purchase [the][such] Assigned Interest and (vii)
[if it is a Foreign Lender,] attached to the Assignment and Assumption is any documentation required to be delivered by it pursuant
to the terms of the Credit Agreement, duly completed and executed by [the][such] Assignee; and (b) agrees that (i) it will, independently
and without reliance on the Administrative Agent, [the][any] Assignor or any other Lender, and based on such documents and information
as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan
Documents and (ii) it will perform in accordance with their terms all of the obligations that, by the terms of the Loan Documents,
are required to be performed by it as a Lender.

 

    	D-5

    	 

    

 

2.          Payments.
From and after the Assignment Effective Date, the Administrative Agent shall make all payments in respect of [the][each] Assigned
Interest (including payments of principal, interest, fees and other amounts) to [the][the relevant] Assignor for amounts which
have accrued to but excluding the Assignment Effective Date and to [the][the relevant] Assignee for amounts which have accrued
from and after the Assignment Effective Date. Notwithstanding the foregoing, the Administrative Agent shall make all payments of
interest, fees or other amounts paid or payable in kind from and after the Assignment Effective Date to [the][the relevant] Assignee.

 

3.          General
Provisions. This Assignment and Assumption shall be binding upon, and inure to the benefit of, the parties hereto and their
respective successors and assigns. This Assignment and Assumption may be executed in any number of counterparts, which together
shall constitute one instrument. Delivery of an executed counterpart of a signature page of this Assignment and Assumption by telecopy
or in electronic format shall be effective as delivery of a manually executed counterpart of this Assignment and Assumption. This
Assignment and Assumption shall be governed by, and construed in accordance with, the law of the State of New York.

 

    	D-6

    	 

    

 

EXHIBIT E

 

GUARANTEE AND COLLATERAL AGREEMENT

 

[Attached]

 

    	E-1

    	 

    

 

EXHIBIT F

 

[FORM OF]

MORTGAGE

 

    	F-1

    	 

    

 

EXHIBIT G-1

 

[FORM OF]

 

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Lenders That Are Not Partnerships For U.S. Federal Income Tax Purposes)

 

Reference is hereby made to the Credit Agreement
dated as of August 27, 2014 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”),
among AMERICAN EAGLE ENERGY CORPORATION, SUNTRUST BANK as Administrative Agent and each lender from time to time party thereto.

 

Pursuant to the provisions of Section 2.17
of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record and beneficial owner of the Loan(s) (as
well as any Revolving Note(s) evidencing such Loan(s)) in respect of which it is providing this certificate, (ii) it is not a bank
within the meaning of Section 881(c)(3)(A) of the IRC, (iii) it is not a ten percent shareholder of the Borrower within the meaning
of Section 871(h)(3)(B) of the IRC and (iv) it is not a controlled foreign corporation related to the Borrower as described in
Section 881(c)(3)(C) of the IRC.

 

The undersigned has furnished the Administrative
Agent and the Borrower with a certificate of its non-U.S. Person status on IRS Form W-8BEN. By executing this certificate, the
undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform the
Borrower and the Administrative Agent and (2) the undersigned shall have at all times furnished the Borrower and the Administrative
Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be
made to the undersigned or in either of the two calendar years preceding such payments.

 

Unless otherwise defined herein, terms defined
in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

 

	[NAME OF LENDER]	 
	 	 
	By:	 	 
	Name:	 
	Title:	 
	 	 
	Date: [________] [__], 20[]	 

 

    	G-1

    	 

    

 

EXHIBIT G-2

 

[FORM OF]

 

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Participants That Are Not Partnerships For U.S. Federal Income Tax Purposes)

 

Reference is hereby made to the Credit Agreement
dated as of August 27, 2014 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”),
among AMERICAN EAGLE ENERGY CORPORATION, SUNTRUST BANK as Administrative Agent and each lender from time to time party thereto.

 

Pursuant to the provisions of Section 2.17
of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record and beneficial owner of the participation
in respect of which it is providing this certificate, (ii) it is not a bank within the meaning of Section 881(c)(3)(A) of the IRC,
(iii) it is not a ten percent shareholder of the Borrower within the meaning of Section 871(h)(3)(B) of the IRC and (iv) it is
not a controlled foreign corporation related to the Borrower as described in Section 881(c)(3)(C) of the IRC.

 

The undersigned has furnished its participating
Lender with a certificate of its non-U.S. Person status on IRS Form W-8BEN. By executing this certificate, the undersigned agrees
that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform such Lender in writing
and (2) the undersigned shall have at all times furnished such Lender with a properly completed and currently effective certificate
in either the calendar year in which each payment is to be made to the undersigned or in either of the two calendar years preceding
such payments.

 

Unless otherwise defined herein, terms defined
in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

 

	[NAME OF PARTICIPANT]	 
	 	 
	By:	 	 
	Name:	 
	Title:	 

 

Date: [________] [__], 20[]

 

    	G-2-1

    	 

    

 

EXHIBIT G-3

 

[FORM OF]

 

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Participants That Are Partnerships For U.S. Federal Income Tax Purposes)

 

Reference is hereby made to the Credit Agreement
dated as of August 27, 2014 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”),
among AMERICAN EAGLE ENERGY CORPORATION, SUNTRUST BANK, as Administrative Agent and each lender from time to time party thereto.

 

Pursuant to the provisions of Section 2.17
of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record owner of the participation in respect
of which it is providing this certificate, (ii) its direct or indirect partners/members are the sole beneficial owners of such
participation, (iii) with respect such participation, neither the undersigned nor any of its direct or indirect partners/members
is a bank extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business within the
meaning of Section 881(c)(3)(A) of the IRC, (iv) none of its direct or indirect partners/members is a ten percent shareholder of
the Borrower within the meaning of Section 871(h)(3)(B) of the IRC and (v) none of its direct or indirect partners/members is a
controlled foreign corporation related to the Borrower as described in Section 881(c)(3)(C) of the IRC.

 

The undersigned has furnished its participating
Lender with IRS Form W-8IMY accompanied by one of the following forms from each of its partners/members that is claiming the portfolio
interest exemption: (i) an IRS Form W-8BEN or (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN from each of such partner’s/member’s
beneficial owners that is claiming the portfolio interest exemption. By executing this certificate, the undersigned agrees that
(1) if the information provided on this certificate changes, the undersigned shall promptly so inform such Lender and (2) the undersigned
shall have at all times furnished such Lender with a properly completed and currently effective certificate in either the calendar
year in which each payment is to be made to the undersigned or in either of the two calendar years preceding such payments.

 

Unless otherwise defined herein, terms defined
in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

 

	[NAME OF PARTICIPANT]	 
	 	 	 
	By:	 	 
	Name:	 
	Title:	 

 

Date: [________] [__], 20[]

 

    	G-3-1

    	 

    

 

EXHIBIT G-4

 

[FORM OF]

 

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Lenders That Are Partnerships For U.S. Federal Income Tax Purposes)

 

Reference is hereby made to the Credit Agreement
dated as of August 27, 2014 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”),
among AMERICAN EAGLE ENERGY CORPORATION, SUNTRUST BANK as Administrative Agent and each lender from time to time party thereto.

 

Pursuant to the provisions of Section 2.17
of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record owner of the Loan(s) (as well as any Revolving
Note(s) evidencing such Loan(s)) in respect of which it is providing this certificate, (ii) its direct or indirect partners/members
are the sole beneficial owners of such Loan(s) (as well as any Revolving Note(s) evidencing such Loan(s)), (iii) with respect to
the extension of credit pursuant to this Credit Agreement or any other Loan Document, neither the undersigned nor any of its direct
or indirect partners/members is a bank extending credit pursuant to a loan agreement entered into in the ordinary course of its
trade or business within the meaning of Section 881(c)(3)(A) of the IRC, (iv) none of its direct or indirect partners/members is
a ten percent shareholder of the Borrower within the meaning of Section 871(h)(3)(B) of the IRC and (v) none of its direct or indirect
partners/members is a controlled foreign corporation related to the Borrower as described in Section 881(c)(3)(C) of the IRC.

 

The undersigned has furnished the Administrative
Agent and the Borrower with IRS Form W-8IMY accompanied by one of the following forms from each of its partners/members that is
claiming the portfolio interest exemption: (i) an IRS Form W-8BEN or (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN
from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption. By executing
this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall
promptly so inform the Borrower and the Administrative Agent and (2) the undersigned shall have at all times furnished the Borrower
and the Administrative Agent with a properly completed and currently effective certificate in either the calendar year in which
each payment is to be made to the undersigned or in either of the two calendar years preceding such payments.

 

Unless otherwise defined herein, terms defined
in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

 

	[NAME OF LENDER]	 
	 	 	 
	By:	 	 
	Name:	 
	Title:	 

 

Date: [________] [__], 20[]

 

    	G-4-1

    	 

    

 

EXHIBIT H-1

OPINION OF BORROWER’S COUNSEL

 

[Attached]

 

    	H-1-1

    	 

    

 

EXHIBIT H-2

OPINION OF BORROWER’S LOCAL NORTH DAKOTA AND MONTANA COUNSEL

 

[Attached]

 

    	H-2-1EXECUTION VERSION

 

GUARANTEE AND COLLATERAL AGREEMENT

made by

AMERICAN EAGLE ENERGY CORPORATION,

and

each of the other Grantors (as defined herein)

in favor of

SUNTRUST BANK,

as Administrative Agent

Dated as of August 27, 2014

 

 

    	 

    	 

    

 

Table
of Contents

 

	 	 	Page
	 	 	 
	ARTICLE 1.	DEFINED TERMS	1
	Section 1.1	Definitions	1
	Section 1.2	Other Definitional Provisions	6
	ARTICLE 2.	GUARANTEE	6
	Section 2.1	Guarantee	6
	Section 2.2	Right of Contribution	7
	Section 2.3	No Subrogation	7
	Section 2.4	Amendments, etc	8
	Section 2.5	Guarantee Absolute and Unconditional	8
	Section 2.6	Payments	9
	ARTICLE 3.	GRANT OF SECURITY INTEREST	9
	Section 3.1	Grant of Security Interest	9
	Section 3.2	Transfer of Pledged Securities	11
	ARTICLE 4.	REPRESENTATIONS AND WARRANTIES	11
	Section 4.1	Title; No Other Liens	11
	Section 4.2	Perfected First Priority Liens	11
	Section 4.3	Jurisdiction of Organization; Chief Executive Office	11
	Section 4.4	Investment Property	12
	Section 4.5	Receivables	13
	Section 4.6	Commercial Tort Claims	13
	Section 4.7	Deposit Accounts, Security Accounts and Commodity Accounts	13
	ARTICLE 5.	COVENANTS	13
	Section 5.1	Delivery of Instruments, Certificated Securities and Chattel Paper	13
	Section 5.2	Maintenance of Insurance	14
	Section 5.3	Maintenance of Perfected Security Interest; Further Documentation	14
	Section 5.4	Changes in Name, etc	14
	Section 5.5	Notices	14
	Section 5.6	Investment Property	15

 

    	-i-

    	 

    

 

Table
of Contents

(continued)

 

	 	 	Page
	 	 	 
	Section 5.7	Receivables	16
	Section 5.8	Commercial Tort Claims	16
	Section 5.9	Covenants in Credit Agreement	17
	ARTICLE 6.	REMEDIAL PROVISIONS	17
	Section 6.1	Certain Matters Relating to Receivables	17
	Section 6.2	Communications with Obligors; Grantors Remain Liable	17
	Section 6.3	Pledged Securities	18
	Section 6.4	Proceeds to Be Turned Over to Administrative Agent	19
	Section 6.5	Application of Proceeds	19
	Section 6.6	Code and Other Remedies	20
	Section 6.7	Restricted Securities	20
	Section 6.8	Deficiency	21
	ARTICLE 7.	THE ADMINISTRATIVE AGENT	21
	Section 7.1	Administrative Agent’s Appointment as Attorney-in-Fact, etc	21
	Section 7.2	Duty of Administrative Agent	23
	Section 7.3	Authentication of Financing Statements	23
	Section 7.4	Authority of Administrative Agent	23
	ARTICLE 8.	SUBORDINATION OF GRANTOR CLAIMS	24
	Section 8.1	Subordination of Grantor Claims	24
	Section 8.2	Claims in Bankruptcy	24
	Section 8.3	Payments Held in Trust	24
	Section 8.4	Liens Subordinate	24
	Section 8.5	Notation of Records	25
	ARTICLE 9.	MISCELLANEOUS	25
	Section 9.1	Amendments in Writing	25
	Section 9.2	Notices	25
	Section 9.3	No Waiver by Course of Conduct; Cumulative Remedies	25
	Section 9.4	Enforcement Expenses; Indemnification	25
	Section 9.5	Successors and Assigns	26
	Section 9.6	Set-Off	26

 

    	-ii-

    	 

    

 

Table
of Contents

(continued)

 

	 	 	Page
	 	 	 
	Section 9.7	Counterparts	26
	Section 9.8	Severability	27
	Section 9.9	Section Headings	27
	Section 9.10	INTEGRATION	27
	Section 9.11	GOVERNING LAW	27
	Section 9.12	JURISDICTION	27
	Section 9.13	Acknowledgements	28
	Section 9.14	Additional Grantors; Additional Pledged Securities	29
	Section 9.15	Releases	29
	Section 9.16	Acceptance	29
	Section 9.17	Retention in Satisfaction	30
	Section 9.18	Reinstatement	30
	Section 9.19	WAIVER OF JURY TRIAL	30
	Section 9.20	Keepwell	30

 

    	-iii-

    	 

    

 

SCHEDULES

 

Schedule 1          Notice Addresses

 

Schedule 2          Investment Property

 

Schedule 3          Perfection Matters

 

Schedule 4          Jurisdictions of Organization
and Chief Executive Offices

 

Schedule 5          Intellectual Property

 

Schedule 6          Deposit Accounts, Securities
Accounts and Commodity Accounts

 

ANNEXES

 

Annex 1              Form of Acknowledgement and
Consent

 

Annex 2              Form of Assumption Agreement

 

Annex 3              Form of Supplement

 

    	 

    	 

    

 

GUARANTEE AND COLLATERAL AGREEMENT

 

GUARANTEE AND COLLATERAL
AGREEMENT, dated as of August 27, 2014, made by AMERICAN EAGLE ENERGY CORPORATION, a Nevada corporation (the “Borrower”),
and each of the other signatories hereto as of the date hereof other than the Administrative Agent (together with any other entity
that becomes a party hereto from time to time after the date hereof as provided herein, the “Grantors”), in
favor of SUNTRUST BANK, as Administrative Agent (in such capacity, the “Administrative Agent”) for the financial
institutions (the “Lenders”) from time to time parties to that certain Credit Agreement, dated as of even date
herewith (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among the
Borrower, the Lenders, and the Administrative Agent.

 

WITNESSETH:

 

WHEREAS, on even date
herewith, the Borrower, the Lenders and the Administrative Agent are executing and delivering the Credit Agreement, pursuant to
which, upon the terms and conditions stated therein, the Lenders have agreed to make loans and other extensions of credit to the
Borrower;

 

WHEREAS, the Borrower
is a member of an affiliated group of companies that includes each Grantor;

 

WHEREAS, the Borrower
and the other Grantors are engaged in related businesses, and each Grantor will derive substantial direct and indirect benefit
from the making of the extensions of credit under the Credit Agreement;

 

WHEREAS, it is a condition
precedent to the obligations of the Lenders to make their respective extensions of credit to the Borrower under the Credit Agreement
that the parties hereto enter into this Agreement on the term and conditions stated herein; and

 

WHEREAS, pursuant to
the terms of the Credit Agreement, the Grantors shall have executed and delivered this Agreement to the Administrative Agent for
the ratable benefit of the Secured Persons;

 

NOW, THEREFORE, in
consideration of the premises, each Grantor hereby agrees with the Administrative Agent, for the ratable benefit of the Secured
Persons, as follows:

 

ARTICLE
1.

DEFINED TERMS

 

Section 1.1           Definitions.

 

(a)          Unless
otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit
Agreement, and the following terms are used herein as defined in the Applicable UCC: Accounts, As-Extracted Collateral, Certificated
Security, Chattel Paper, Commercial Tort Claims, Commodity Accounts, Commodity Contracts, Deposit Accounts, Documents, Equipment,
Fixtures, General Intangibles, Instruments, Goods, Inventory, Letter-of-Credit Rights, Supporting Obligations and Uncertificated
Securities.

 

    	 

    	 

    

 

(b)          The
following terms shall have the following meanings:

 

“Acknowledgement
and Consent” means an Acknowledgment and Consent in the form of Annex 1 hereto.

 

“Agreement”
means this Guarantee and Collateral Agreement, as the same may be amended, supplemented or otherwise modified from time to time.

 

“Applicable
UCC” means the Uniform Commercial Code as from time to time in effect in the State of New York.

 

“Assumption
Agreement” means an Assumption Agreement in the form of Annex 2 hereto.

 

“Collateral”
has the meaning given such term in Section 3.1.

 

“Collateral
Account” means any collateral account established by the Administrative Agent as provided in Section 6.1 or Section
6.4.

 

“Commodity
Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any successor
statute.

 

“Copyrights”
means (i) all copyrights arising under the laws of the United States, any other country or any political subdivision thereof, whether
registered or unregistered and whether published or unpublished (including, without limitation, those listed in Schedule 5),
all registrations and recordings thereof, and all applications in connection therewith, including, without limitation, all registrations,
recordings and applications in the United States Copyright Office, and (ii) the right to obtain all renewals thereof.

 

“Copyright
Licenses” means any written agreement naming any Grantor as licensor or licensee (including, without limitation, those
listed in Schedule 5), granting any right under any Copyright, including, without limitation, the grant of rights to manufacture,
distribute, exploit and sell materials derived from any Copyright.

 

“Deposit Account”
has the meaning given such term in the Uniform Commercial Code of any applicable jurisdiction and, in any event, including, without
limitation, any demand, time, savings, passbook or like account maintained with a depositary institution.

 

“Excluded
Hedge Obligation” means, with respect to any Loan Party, any Lender Provided Hedging Agreement if and to the extent that
all or a portion of the guarantee of such Loan Party of, or the grant by such Loan Party of a security interest to secure, such
Lender Provided Hedging Agreement (or any guarantee thereof) is or becomes (as a result of a Change in Law after the date of a
transaction governed by such Lender Provided Hedging Agreement) illegal under the Commodity Exchange Act or any rule, regulation
or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of
such Loan Party’s failure for any reason to constitute a Qualified ECP Guarantor at the time such Loan Party’s guarantee
or such Loan Party’s grant of such security interest becomes effective with respect to such Lender Provided Hedging Agreement.
If a Hedging Obligation arises under a Lender Provided Hedging Agreement governing more than one Hedging Agreement, such exclusion
shall apply only to the portion of such Hedging Obligation that is attributable to Hedging Agreements for which such guarantee
or security interest is or becomes illegal.

 

    	2

    	 

    

 

“Guarantor
Obligations” means, with respect to any Guarantor, all obligations and liabilities of such Guarantor which may arise
under or in connection with this Agreement (including, without limitation, Article 2) or any other Secured Document to which
such Guarantor is a party, in each case whether on account of guarantee obligations, reimbursement obligations, fees, indemnities,
costs, expenses or otherwise (including, without limitation, all fees and disbursements of counsel to the Administrative Agent
or to the Secured Persons that are required to be paid by such Guarantor pursuant to the terms of this Agreement or any other Secured
Document, but excluding Excluded Hedge Obligations).

 

“Guarantors”
means the collective reference to each Grantor other than the Borrower.

 

“Hedging Obligation”
means, with respect to any Guarantor, any obligation to pay or perform under any agreement, contract or transaction that constitutes
a “swap” within the meaning of section 1a(47) of the Commodity Exchange Act.

 

“Intercompany
Note” means any promissory note evidencing loans made by any Grantor, the Borrower or any of their respective Subsidiaries.

 

“Intellectual
Property” means the collective reference to all rights, priorities and privileges relating to intellectual property,
whether arising under United States, multinational or foreign laws or otherwise, including, without limitation, the Copyrights,
the Copyright Licenses, the Patents, the Patent Licenses, the Trademarks and the Trademark Licenses, trade secrets and confidential
information, the tangible and digital embodiments of the foregoing, and all rights to sue at law or in equity for any infringement
or other impairment thereof, including the right to receive all proceeds and damages therefrom.

 

“Investment
Property” means the collective reference to (i) all “investment property” as such term is defined in Section
9-102(a)(49) of the Applicable UCC and (ii) whether or not constituting “investment property” as so defined, all Pledged
Notes and all Pledged Securities.

 

“Issuers”
means the collective reference to each issuer of any Investment Property.

 

“LLC”
means, with respect to any Grantor, each limited liability company described or referred to in Schedule 2 in which such
Grantor has an interest.

 

“LLC Agreement”
means each operating agreement relating to an LLC, as each agreement has heretofore been, and may hereafter be, amended, restated,
supplemented or otherwise modified from time to time.

 

    	3

    	 

    

 

“Obligations”
means the collective reference to the unpaid principal of and interest on the Loans and LC Exposure and all other obligations and
liabilities of the Loan Parties (including, without limitation, interest accruing at the then applicable rate provided in the Credit
Agreement after the maturity of the Loans and LC Exposure and interest accruing at the then applicable rate provided in the Credit
Agreement after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding,
relating to the Borrower or any other Loan Party, whether or not a claim for post-filing or post-petition interest is allowed in
such proceeding) to the Secured Persons, whether direct or indirect, absolute or contingent, due or to become due, or now existing
or hereafter incurred, which may arise under, out of, or in connection with, the Credit Agreement and the other Secured Documents,
or any other document made, delivered or given in connection with any of the foregoing, in each case whether on account of principal,
interest, reimbursement obligations (including, without limitation, obligations to reimburse LC Disbursements), payments in respect
of an early termination date, unpaid amounts, fees, indemnities, costs, expenses or otherwise (including, without limitation, all
fees and disbursements of counsel to the Secured Persons that are required to be paid by any Loan Party pursuant to the terms of
any of the foregoing agreements).

 

“Partnership”
means, with respect to any Grantor, each partnership described or referred to in Schedule 2 in which such Grantor has an
interest.

 

“Partnership
Agreement” means each partnership agreement governing a Partnership, as each such agreement has heretofore been, and
may hereafter be, amended, restated, supplemented or otherwise modified.

 

“Patents”
means (i) all letters patent of the United States, any other country or any political subdivision thereof, all reissues and extensions
thereof and all goodwill associated therewith, including, without limitation, any of the foregoing referred to in Schedule 5,
(ii) all applications for letters patent of the United States or any other country and all divisions, continuations and continuations-in-part
thereof, including, without limitation, any of the foregoing referred to in Schedule 5, and (iii) all rights to obtain any
reissues or extensions of the foregoing.

 

“Patent License”
means all agreements, whether written or oral, providing for the grant by or to any Grantor of any right to manufacture, use or
sell any invention covered in whole or in part by a Patent, including, without limitation, any of the foregoing referred to in
Schedule 5.

 

“Pledged LLC
Interests” means, with respect to any Grantor, all right, title and interest of such Grantor as a member of all LLCs
and all right, title and interest of such Grantor in, to and under the LLC Agreements.

 

“Pledged Notes”
means all promissory notes listed on Schedule 2, all Intercompany Notes at any time issued to any Grantor and all other
promissory notes issued to or held by any Grantor (other than promissory notes issued in connection with extensions of trade credit
by any Grantor in the ordinary course of business).

 

    	4

    	 

    

 

“Pledged Partnership
Interests” means, with respect to any Grantor, all right, title and interest of such Grantor as a limited or general
partner in all Partnerships and all right, title and interest of such Grantor in, to and under the Partnership Agreements.

 

“Pledged Securities”
means, collectively, (i) the Equity Interests described or referred to on Schedule 2 (as the same may be supplemented from
time to time pursuant to a Supplement), together with any other shares, stock certificates, options, interests or rights of any
nature whatsoever in respect of the Equity Interests of any Person that may be issued or granted to, or held by, any Grantor while
this Agreement is in effect; and (i) (a) the certificates or instruments, if any, representing such Equity Interests, (b) all dividends
(cash, Equity Interests or otherwise), cash, instruments, rights to subscribe, purchase or sell and all other rights and property
from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of such Equity Interests,
(c) all replacements, additions to and substitutions for any of the Property referred to in this definition, including, without
limitation, claims against third parties, (d) the proceeds, interest, profits and other income of or on any of the Property referred
to in this definition, (e) all security entitlements in respect of any of the foregoing, if any, and (f) all books and records
relating to any of the Property referred to in this definition.

 

“Proceeds”
means all “proceeds” as such term is defined in Section 9-102(a)(64) of the Applicable UCC and, in any event, shall
include, without limitation, all dividends or other income from all Investment Property included in the Collateral, collections
thereon or distributions or payments with respect thereto.

 

“Qualified
ECP Guarantor” means, in respect of any Lender Provided Hedging Agreement, each Grantor that has total assets exceeding
$10,000,000 at the time the relevant guarantee or grant of the relevant security interest becomes effective with respect to such
Lender Provided Hedging Agreement or such other person as constitutes an “eligible contract participant” under the
Commodity Exchange Act or any regulations promulgated thereunder and can cause another person to qualify as an “eligible
contract participant” at such time by entering into a keepwell under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

 

“Receivable”
means any right to payment for goods sold or leased or for services rendered, whether or not such right is evidenced by an Instrument
or Chattel Paper and whether or not it has been earned by performance (including, without limitation, any Account).

 

“Secured Documents”
means the collective reference to the Credit Agreement, the other Loan Documents, each Lender Provided Hedging Agreement and each
Lender Provided Financial Service Product.

 

“Secured Obligations”
means (i) in the case of the Borrower, the Obligations, and (ii) in the case of each Guarantor, its Guarantor Obligations.

 

“Secured Persons”
means the collective reference to the Administrative Agent, the Arranger, the Issuing Bank, the Lenders, each Secured Swap Party
and each Lender or Affiliate of a Lender providing a Lender Provided Financial Service Product.

 

“Secured Swap
Party”�shall have the meaning set forth in the Intercreditor Agreement.

 

    	5

    	 

    

 

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

 

“Supplement”
means a Supplement in the form of Annex 3 hereto.

 

“Trademarks”
means (i) all trademarks, trade names, corporate names, company names, business names, fictitious business names, trade styles,
service marks, logos and other source or business identifiers, and all goodwill associated therewith, now existing or hereafter
adopted or acquired, all registrations and recordings thereof, and all applications in connection therewith, whether in the United
States Patent and Trademark Office or in any similar office or agency of the United States, any State thereof or any other country
or any political subdivision thereof, or otherwise, and all common-law rights related thereto, including, without limitation, any
of the foregoing referred to in Schedule 5, and (ii) the right to obtain all renewals thereof.

 

“Trademark
License” means any agreement, whether written or oral, providing for the grant by or to any Grantor of any right to use
any Trademark, including, without limitation, any of the foregoing referred to in Schedule 5.

 

Section 1.2           Other
Definitional Provisions.

 

(a)          The
words “hereof,” “herein”, “hereto” and “hereunder” and words of similar import
when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and
Section and Schedule references are to this Agreement unless otherwise specified.

 

(b)          The
meanings given to terms defined herein shall be equally applicable to both the singular and plural forms of such terms.

 

(c)          Where
the context requires, terms relating to the Collateral or any part thereof, when used in relation to a Grantor, shall refer to
such Grantor’s Collateral or the relevant part thereof.

 

ARTICLE
2.

GUARANTEE

 

Section 2.1           Guarantee.

 

(a)          Each
of the Guarantors hereby, jointly and severally, unconditionally and irrevocably, guarantees to the Administrative Agent, for the
ratable benefit of the Secured Persons and their respective successors, endorsees, transferees and assigns, the prompt and complete
payment and performance by the Borrower and the other Loan Parties when due (whether at the stated maturity, by acceleration or
otherwise) of the Obligations.

 

(b)          Anything
herein or in any other Loan Document to the contrary notwithstanding, the maximum liability of each Guarantor hereunder and under
the other Loan Documents shall in no event exceed the amount which can be guaranteed by such Guarantor under applicable federal
and state laws relating to the insolvency of debtors (after giving effect to the right of contribution established in Section
2.2).

 

    	6

    	 

    

 

(c)          Each
Guarantor agrees that the Obligations may at any time and from time to time exceed the amount of the liability of such Guarantor
hereunder without impairing the guarantee contained in this Article 2 or affecting the rights and remedies of the Administrative
Agent or any other Secured Person hereunder.

 

(d)          The
guarantee contained in this Article 2 shall remain in full force and effect until the Termination Date, notwithstanding
that from time to time during the term of the Credit Agreement the Borrower or any other Loan Party may be free from any Obligations.

 

(e)          No
payment made by the Borrower, any of the Guarantors, any other guarantor or any other Person or received or collected by the Administrative
Agent or any other Secured Person from the Borrower, any of the Guarantors, any other guarantor or any other Person by virtue of
any action or proceeding or any set-off or appropriation or application at any time or from time to time in reduction of or in
payment of the Obligations shall be deemed to modify, reduce, release or otherwise affect the liability of any Guarantor hereunder
which shall, notwithstanding any such payment (other than any payment made by such Guarantor in respect of the Obligations or any
payment received or collected from such Guarantor in respect of the Obligations), remain liable for the Obligations up to the maximum
liability of such Guarantor hereunder until the Termination Date.

 

Section 2.2           Right
of Contribution. Each Guarantor hereby agrees that to the extent that a Guarantor shall have paid more than its proportionate
share of any payment made hereunder, such Guarantor shall be entitled to seek and receive contribution from and against any other
Guarantor hereunder which has not paid its proportionate share of such payment. Each Guarantor’s right of contribution shall
be subject to the terms and conditions of Section 2.3. The provisions of this Section 2.2 shall in no respect limit
the obligations and liabilities of any Guarantor to the Administrative Agent and the other Secured Persons, and each Guarantor
shall remain liable for the Obligations up to the maximum liability of such Guarantor hereunder.

 

Section 2.3           No
Subrogation. Notwithstanding any payment made by any Guarantor hereunder or any set-off or application of funds of any Guarantor
by the Administrative Agent or any other Secured Person, no Guarantor shall be entitled to be subrogated to any of the rights of
the Administrative Agent or any other Secured Person against the Borrower or any other Guarantor or any collateral security or
guarantee or right of offset held by the Administrative Agent or any other Secured Person for the payment of the Obligations, nor
shall any Guarantor seek or be entitled to seek any contribution or reimbursement from the Borrower or any other Guarantor in respect
of payments made by such Guarantor hereunder, until the Termination Date. If any amount shall be paid to any Guarantor on account
of such subrogation rights at any time prior to the Termination Date, such amount shall be held by such Guarantor in trust for
the Administrative Agent and the other Secured Persons, segregated from other funds of such Guarantor, and shall, forthwith upon
receipt by such Guarantor, be turned over to the Administrative Agent in the exact form received by such Guarantor (duly indorsed
by such Guarantor to the Administrative Agent, if required), to be applied against the Obligations, whether matured or unmatured,
in accordance with Section 7.2 of the Credit Agreement.

 

    	7

    	 

    

 

Section 2.4           Amendments,
etc. with respect to the Obligations. Each Guarantor shall remain obligated hereunder notwithstanding that, without any reservation
of rights against any Guarantor and without notice to or further assent by any Guarantor, any demand for payment of any of the
Obligations made by the Administrative Agent or any other Secured Person may be rescinded by the Administrative Agent or such other
Secured Person and any of the Obligations continued, and the Obligations, or the liability of any other Person upon or for any
part thereof, or any collateral security or guarantee therefor or right of offset with respect thereto, may, from time to time,
in whole or in part, be renewed, extended, amended, modified, accelerated, compromised, waived, surrendered or released by the
Administrative Agent or any other Secured Person, and the Credit Agreement, the other Loan Documents, the Lender Provided Hedging
Agreements, the Lender Provided Financial Service Products and any other documents executed and delivered in connection therewith
may be amended, modified, supplemented or terminated, in whole or in part, as the Administrative Agent (or the Majority Lenders,
or Required Lenders or all Lenders, as the case may be) may deem advisable from time to time, and any collateral security, guarantee
or right of offset at any time held by the Administrative Agent or any other Secured Person for the payment of the Obligations
may be sold, exchanged, waived, surrendered or released. Neither the Administrative Agent nor any other Secured Person shall have
any obligation to protect, secure, perfect or insure any Lien at any time held by it as security for the Obligations or for the
guarantee contained in this Article 2 or any property subject thereto.

 

Section 2.5           Guarantee
Absolute and Unconditional. Each Guarantor waives any and all notice of the creation, renewal, extension or accrual of any
of the Obligations and notice of or proof of reliance by the Administrative Agent or any other Secured Person upon the guarantee
contained in this Article 2 or acceptance of the guarantee contained in this Article 2; the Obligations, and any
of them, shall conclusively be deemed to have been created, contracted or incurred, or renewed, extended, amended or waived, in
reliance upon the guarantee contained in this Article 2; and all dealings between the Borrower and any of the Guarantors,
on the one hand, and the Administrative Agent and the other Secured Persons, on the other hand, likewise shall be conclusively
presumed to have been had or consummated in reliance upon the guarantee contained in this Article 2. Each Guarantor waives
diligence, presentment, protest, demand for payment and notice of default or nonpayment to or upon the Borrower or any of the Guarantors
with respect to the Obligations. Each Guarantor understands and agrees that the guarantee contained in this Article 2 shall
be construed as a continuing, absolute and unconditional guarantee of payment and not of collection without regard to (a) the validity
or enforceability of the Credit Agreement or any other Loan Document, any of the Obligations or any other collateral security therefor
or guarantee or right of offset with respect thereto at any time or from time to time held by the Administrative Agent or any other
Secured Person, (b) any defense, set-off or counterclaim (other than a defense of payment or performance) which may at any time
be available to or be asserted by the Borrower or any other Person against the Administrative Agent or any other Secured Person,
or (c) any other circumstance whatsoever (with or without notice to or knowledge of the Borrower or such Guarantor) which constitutes,
or might be construed to constitute, an equitable or legal discharge of the Borrower or any other Loan Party for the Obligations,
or of such Guarantor under the guarantee contained in this Article 2, in bankruptcy or in any other instance (other than
a defense of payment). When making any demand hereunder or otherwise pursuing its rights and remedies hereunder against any Guarantor,
the Administrative Agent or any other Secured Person may, but shall be under no obligation to, make a similar demand on or otherwise
pursue such rights and remedies as it may have against the Borrower, any other Guarantor or any other Person or against any collateral
security or guarantee for the Obligations or any right of offset with respect thereto, and any failure by the Administrative Agent
or any other Secured Person to make any such demand, to pursue such other rights or remedies or to collect any payments from the
Borrower, any other Guarantor or any other Person or to realize upon any such collateral security or guarantee or to exercise any
such right of offset, or any release of the Borrower, any other Guarantor or any other Person or any such collateral security,
guarantee or right of offset, shall not relieve any Guarantor of any obligation or liability hereunder, and shall not impair or
affect the rights and remedies, whether express, implied or available as a matter of law, of the Administrative Agent or any other
Secured Person against any Guarantor. For the purposes hereof “demand” shall include the commencement and continuance
of any legal proceedings.

 

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Section 2.6           Payments.
Each Guarantor hereby guarantees that payments hereunder will be paid to the Administrative Agent, for the benefit of the Secured
Persons, without set-off or counterclaim in Dollars at the Administrative Agent’s office for funding.

 

ARTICLE
3.

GRANT OF SECURITY INTEREST

 

Section 3.1           Grant
of Security Interest. Each Grantor hereby assigns and transfers to the Administrative Agent, and hereby grants to the Administrative
Agent, for the ratable benefit of the Secured Persons, a security interest in, all of the following property now owned or at any
time hereafter acquired by such Grantor or in which such Grantor now has or at any time in the future may acquire any right, title
or interest (collectively, the “Collateral”), as collateral security for the prompt and complete payment and
performance when due (whether at the stated maturity, by acceleration or otherwise) of such Grantor’s Secured Obligations:

 

(a)          all
Accounts;

 

(b)          As-Extracted
Collateral;

 

(c)          all
Chattel Paper;

 

(d)          all
Deposit Accounts, Commodity Accounts, Security Accounts, and Security Entitlements;

 

(e)          all
Documents;

 

(f)          all
Goods and Equipment;

 

(g)          all
Fixtures;

 

(h)          all
General Intangibles;

 

(i)          all
Instruments;

 

(j)          all
Intellectual Property;

 

(k)          all
Inventory;

 

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(l)          all
Investment Property;

 

(m)          all
Letter-of-Credit Rights;

 

(n)          all
Commercial Tort Claims;

 

(o)          all
other property not otherwise described above (except for any property specifically excluded from any clause in this Section above,
and any property specifically excluded from any defined term used in any clause of this Section above);

 

(p)          all
books and records pertaining to the Collateral; and

 

(q)          to
the extent not otherwise included, all Proceeds, Supporting Obligations and products of any and all of the foregoing and all collateral
security and guarantees given by any Person with respect to any of the foregoing.

 

Notwithstanding anything
herein to the contrary, in no event shall the security interest granted under this Section 3.1 hereof attach to (“Excluded
Collateral”) (i) any license, contract, or agreement included in the Collateral under this Section 3.1 to which
a Grantor is a party or any of its rights or interest thereunder if and to the extent that and for so long as the grant of such
security interest shall constitute or result in a breach or termination pursuant to the terms of, or a default under, any such
license, contract or agreement (other than to the extent that any such term would be rendered ineffective pursuant to Sections
9-406, 9-407, 9-408 or 9-409 of the Applicable UCC (or any successor provision or provisions) of any relevant jurisdiction or any
other applicable law); provided that, such security interest shall attach immediately at such time as the condition causing
such abandonment, invalidation or unenforceability shall be remedied and to the extent severable, shall attach immediately to any
portion of such license, contract or agreement that does not result in any of the consequences specified above (ii) fixed or capital
assets owned by any Grantor that is subject to a purchase money Lien or a Capital Lease Obligation permitted under Section 6.2(e)
of the Credit Agreement if the contractual obligation pursuant to which such Lien is granted (or the document providing for such
purchase money Lien or capital lease) prohibits or requires the consent of any Person other than any Grantor or any of their respective
Affiliates as a condition to the creation by such Grantor of a Lien thereon which consent has not been obtained as a condition
to the creation of any other Lien on such property or (iii) the Equity Interests of each Foreign Subsidiary to the extent that
the voting power of such Equity Interests aggregates to more than 65% of the voting power of such Foreign Subsidiary. For the avoidance
of doubt, notwithstanding the preceding sentence or anything to the contrary contained herein, “Collateral”
shall include the following to the extent the same otherwise constitutes Collateral (and therefore, the following shall not constitute
Excluded Collateral): (u) real property, including the Hydrocarbon Interests, (v) all Equity Interests in Restricted Subsidiaries
of the Borrower (unless such Restricted Subsidiary is a Foreign Subsidiary in which case the Collateral shall constitute the Equity
Interests of such Foreign Subsidiary to the extent of 65% of the voting power of such Foreign Subsidiary), (w) the right to any
distributions (whether periodic or in liquidation or dissolution) with respect to any Equity Interests, including, without limitation,
limited partnership interest or limited liability company member interests, (x) Hydrocarbons, (y) As-Extracted Collateral, and
(z) fixtures.

 

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Section 3.2           Transfer
of Pledged Securities. All certificates or instruments representing or evidencing the Pledged Securities shall be delivered
to and held pursuant hereto by the Administrative Agent or a Person designated by the Administrative Agent and shall be in suitable
form for transfer by delivery, or shall be accompanied by duly executed instruments of transfer or assignment in blank, in a manner
satisfactory to the Administrative Agent, and accompanied by any required transfer tax stamps to effect the pledge of the Pledged
Securities to the Administrative Agent. Notwithstanding the preceding sentence, at the Administrative Agent’s discretion,
all Pledged Securities must be delivered or transferred in such manner as to permit the Administrative Agent to be a “protected
purchaser” to the extent of its security interest as provided in Section 8-303 of the Applicable UCC (if the Administrative
Agent otherwise qualifies as a protected purchaser).

 

ARTICLE
4.

REPRESENTATIONS AND WARRANTIES

 

To induce the Administrative
Agent and the Lenders to enter into the Credit Agreement and to induce the Lenders to make their respective extensions of credit
to the Borrower thereunder, each Grantor hereby represents and warrants to the Administrative Agent and each Lender that:

 

Section 4.1           Title;
No Other Liens. Except for the security interest granted to the Administrative Agent for the ratable benefit of the Secured
Persons pursuant to this Agreement and the other Liens permitted to exist on the Collateral by the Credit Agreement, such Grantor
owns or has a valid leasehold interest in each item of the Collateral free and clear of any and all Liens or claims of others.
No financing statement or other public notice with respect to all or any part of the Collateral is on file or of record in any
public office, except such as have been filed in favor of the Administrative Agent, for the ratable benefit of the Secured Persons,
pursuant to this Agreement or as are permitted by the Credit Agreement, including financing statements relating to the Debt to
be Repaid and the Permitted Secured Notes Documents.

 

Section 4.2           Perfected
First Priority Liens. The security interests granted pursuant to this Agreement (a) upon completion of the filings and other
actions specified on Schedule 3 will constitute valid perfected (to the extent that such security interests can be perfected
by the central filing of a financing statement pursuant to the applicable Uniform Commercial Code) security interests in all of
the Collateral in favor of the Administrative Agent, for the ratable benefit of the Secured Persons, as collateral security for
such Grantor’s Secured Obligations, enforceable in accordance with the terms hereof against all creditors of such Grantor
and all Persons purporting to purchase any Collateral from such Grantor and (b) to the extent so perfected, are prior to all other
Liens on the Collateral in existence on the date hereof except for unrecorded Liens permitted by the Credit Agreement which have
priority over the Liens on the Collateral by operation of law.

 

Section 4.3           Jurisdiction
of Organization; Chief Executive Office. On the date hereof, such Grantor’s jurisdiction of organization, identification
number from the jurisdiction of organization (if any), and the location of such Grantor’s chief executive office or sole
place of business or principal residence, as the case may be, are specified on Schedule 4. Such Grantor has furnished to
the Administrative Agent a certified charter, articles of incorporation or other organization document and good standing certificate
as of a date which is recent to the date hereof.

 

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Section 4.4           Investment
Property.

 

(a)          The
shares of Pledged Securities pledged by such Grantor hereunder constitute all the issued and outstanding shares of all classes
of the Equity Interests of each Issuer owned by such Grantor.

 

(b)          All
the shares of the Pledged Securities have been duly and validly issued and are fully paid and nonassessable (or, with respect to
the Pledged Securities that are Equity Interests in a partnership or limited liability company, has been duly and validly issued).

 

(c)          There
are no restrictions on transfer (that have not been waived or otherwise consented to, including pursuant to Section 5.6(d)
hereof) in the LLC Agreement governing any Pledged LLC Interest or the Partnership Agreement governing any Pledged Partnership
Interest or any other agreement relating thereto which would limit or restrict: (i) the grant of a security interest in the Pledged
LLC Interests or the Pledged Partnership Interests, (ii) the perfection of such security interest or (iii) the exercise of remedies
in respect of such perfected security interest in the Pledged LLC Interests or the Pledged Partnership Interests, in each case,
as contemplated by this Agreement. Upon the exercise of remedies in respect of the Pledged LLC Interests or the Pledged Partnership
Interests, a transferee or assignee of a membership interest or a partnership interest, as the case may be, of such LLC or Partnership,
as the case may be, shall become a member or partner, as the case may be, of such LLC or Partnership, as the case may be, entitled
to participate in the management thereof and, upon the transfer of the entire interest of such Grantor, such Grantor shall cease
to be a member or partner, as the case may be.

 

(d)          Each
of the Pledged Notes constitutes the legal, valid and binding obligation of the obligor with respect thereto, enforceable in accordance
with its terms, subject to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar
laws relating to or affecting creditors’ rights generally, general equitable principles (whether considered in a proceeding
in equity or at law) and an implied covenant of good faith and fair dealing.

 

(e)          Such
Grantor is the record and beneficial owner of, and has good and marketable title to, the Investment Property pledged by it hereunder,
free of any and all Liens or options in favor of, or claims of, any other Person, except (i) the security interest created by this
Agreement, (ii) the other Liens permitted by the Credit Agreement and (iii) the security interest created by the Permitted Secured
Notes Documents.

 

(f)          No
Grantor is party to any Partnership Agreement or LLC Agreement that includes an election to treat the membership interests or partnership
interests of such Grantor as a security under Section 8-103 of the Applicable UCC.

 

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Section 4.5           Receivables.

 

(a)          On
the date hereof, no amount payable to such Grantor under or in connection with any Receivable is evidenced by any Instrument or
Chattel Paper which has not been delivered to the Administrative Agent.

 

(b)          On
the date hereof, none of the obligors on any Receivables is a Governmental Authority.

 

(c)          The
amounts represented by such Grantor to the Administrative Agent or the Secured Persons from time to time as owing to such Grantor
in respect of the Receivables will at such times be accurate in all material respects (subject to offsets and refunds in the ordinary
course of business).

 

Section 4.6           Commercial
Tort Claims.

 

(a)          On
the date hereof, no Grantor has knowledge that it has any rights in any Commercial Tort Claim with potential value in excess of
$100,000.

 

(b)          Upon
the filing of a financing statement covering any Commercial Tort Claim referred to in Section 5.8 against such Grantor in
the jurisdiction specified under the heading “Uniform Commercial Code Filings” in Schedule 3 hereto, the security
interest granted in such Commercial Tort Claim will constitute a valid perfected security interest in favor of the Administrative
Agent, for the ratable benefit of the Secured Persons, as collateral security for such Grantor’s Secured Obligations, enforceable
in accordance with the terms hereof against all creditors of such Grantor and any Persons purporting to purchase such Collateral
from Grantor, which security interest shall be prior to all other Liens on such Collateral except for unrecorded liens permitted
by the Credit Agreement which have priority over the Liens on such Collateral by operation of law.

 

Section 4.7           Deposit
Accounts, Security Accounts and Commodity Accounts. Such Grantor does not maintain any Deposit Accounts, Security Accounts
or Commodity Accounts with any Person, in each case, except as set forth on Schedule 6.

 

ARTICLE
5.

COVENANTS

 

Each Grantor covenants
and agrees with the Administrative Agent and the Lenders that, from and after the date of this Agreement until the Termination
Date:

 

Section 5.1           Delivery
of Instruments, Certificated Securities and Chattel Paper. If any amount payable under or in connection with any of the Collateral
shall be or become evidenced by any Instrument, Certificated Security or Chattel Paper, such Instrument, Certificated Security
or Chattel Paper shall be immediately delivered to the Administrative Agent, duly indorsed in a manner satisfactory to the Administrative
Agent, to be held as Collateral pursuant to this Agreement; provided that no such Instrument, Certificated Security or Chattel
Paper shall be required to be delivered to the Administrative Agent so long as the aggregate amount payable evidenced by all such
undelivered Instruments, Certificated Securities or Chattel Papers does not exceed $100,000.

 

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Section 5.2           Maintenance
of Insurance. Such Grantor will maintain, with financially sound and reputable companies, insurance policies as required by
Section 5.5 of the Credit Agreement.

 

Section 5.3           Maintenance
of Perfected Security Interest; Further Documentation.

 

(a)          Such
Grantor shall maintain the security interest created by this Agreement as a perfected security interest (to the extent required
to be perfected hereunder) having at least the priority described in Section 4.2 and shall defend such security interest
against the claims and demands of all Persons whomsoever, subject to the rights of such Grantor under the Loan Documents to dispose
of the Collateral.

 

(b)          Such
Grantor will furnish to the Administrative Agent from time to time statements and schedules further identifying and describing
the assets and property of such Grantor and such other reports in connection therewith as the Administrative Agent may reasonably
request, all in reasonable detail.

 

(c)          At
any time and from time to time, upon the written request of the Administrative Agent, and at the sole expense of such Grantor,
such Grantor will promptly and duly execute and deliver, and have recorded, such further instruments and documents and take such
further actions as the Administrative Agent may reasonably request for the purpose of obtaining or preserving the full benefits
of this Agreement and of the rights and powers herein granted, including, without limitation, (i) filing any financing or continuation
statements under the Uniform Commercial Code (or other similar laws) in effect in any jurisdiction with respect to the security
interests created hereby and (ii) in the case of Investment Property, Deposit Accounts, Letter-of-Credit Rights and any other relevant
Collateral, taking any actions necessary to enable the Administrative Agent to obtain “control” (within the meaning
of the applicable Uniform Commercial Code) with respect thereto.

 

Section 5.4           Changes
in Name, etc. Such Grantor will not, except upon 15 days’ (or such shorter period of time permitted by the Administrative
Agent in its sole discretion) prior written notice to the Administrative Agent and delivery to the Administrative Agent of all
additional financing statements and other documents reasonably requested by the Administrative Agent to maintain the validity,
perfection and priority of the security interests provided for herein, (i) change its jurisdiction of organization or, if it is
not a “registered organization” (within the meaning of Section 9-102(a)(70) of the Applicable UCC), the location of
its chief executive office or sole place of business or principal residence from that referred to in Section 4.3 or (ii)
change its name.

 

Section 5.5           Notices.
Such Grantor will advise the Administrative Agent promptly, in reasonable detail, of:

 

(a)          any
Lien (other than security interests created hereby or Liens permitted under the Credit Agreement or created pursuant to the Permitted
Secured Notes Documents) on any of the Collateral which would adversely affect the ability of the Administrative Agent to exercise
any of its remedies hereunder; and

 

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(b)          the
occurrence of any other event which could reasonably be expected to have a material adverse effect on the aggregate value of the
Collateral or on the security interests created hereby.

 

Section 5.6           Investment
Property.

 

(a)          If
such Grantor shall become entitled to receive or shall receive any certificate (including, without limitation, any certificate
representing a dividend or a distribution in connection with any reclassification, increase or reduction of capital or any certificate
issued in connection with any reorganization), option or rights in respect of the Equity Interests of any Issuer, whether in addition
to, in substitution of, as a conversion of, or in exchange for, any shares of the Pledged Securities, or otherwise in respect thereof,
such Grantor shall accept the same as the agent of the Administrative Agent and the other Secured Persons, hold the same in trust
for the Administrative Agent and the other Secured Persons and deliver the same forthwith to the Administrative Agent in the exact
form received, duly indorsed by such Grantor to the Administrative Agent, if required, together with an undated stock power covering
such certificate duly executed in blank by such Grantor and with, if the Administrative Agent so requests, signature guaranteed,
to be held by the Administrative Agent, subject to the terms hereof, as additional collateral security for the Secured Obligations.
In case any property shall be distributed upon or with respect to any Investment Property included in the Collateral pursuant to
the recapitalization or reclassification of the capital of any Issuer or pursuant to the reorganization thereof, the property so
distributed shall, unless otherwise subject to a security interest in favor of the Administrative Agent, be delivered to the Administrative
Agent to be held by it hereunder as additional collateral security for the Secured Obligations. Each Grantor hereby authorizes
and instructs each Issuer of any Investment Property pledged by such Grantor hereunder to notify the Administrative Agent promptly
in writing of the occurrence of any of the events described in this Section 5.6(a).

 

(b)          Without
the prior written consent of the Administrative Agent, such Grantor will not (i) vote to enable, or take any other action to permit,
any Issuer to issue any Equity Interests of any nature or to issue any other securities convertible into or granting the right
to purchase or exchange for any Equity Interests of any nature of any Issuer, (ii) sell, assign, transfer, exchange, or otherwise
dispose of, or grant any option with respect to, the Investment Property or Proceeds thereof (except pursuant to a transaction
expressly permitted by the Credit Agreement), (iii) create, incur or permit to exist any Lien or option in favor of, or any claim
of any Person with respect to, any of the Investment Property or Proceeds thereof, or any interest therein, except for the security
interests created by this Agreement, the other Liens permitted by the Credit Agreement or the security interests created by the
Permitted Secured Notes Documents or (iv) enter into any agreement or undertaking restricting the right or ability of such Grantor
or the Administrative Agent to sell, assign or transfer any of the Investment Property or Proceeds thereof.

 

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(c)          In
the case of each Grantor which is an Issuer, such Issuer agrees that (i) it will be bound by the terms of this Agreement relating
to the Investment Property issued by it and will comply with such terms insofar as such terms are applicable to it, (ii) it will
notify the Administrative Agent promptly in writing of the occurrence of any of the events described in Section 5.6(a) with
respect to the Investment Property issued by it and (iii) the terms of Section 6.3(c) and Section 6.7 shall apply
to it, mutatis mutandis, with respect to all actions that may be required of it pursuant to Section 6.3(c) or Section
6.7 with respect to the Investment Property issued by it. In the case of any Issuer of any Pledged Note or Pledged Security
that is not a Grantor hereunder, such Grantor shall promptly cause such Issuer to execute and deliver to the Administrative Agent
an Acknowledgment and Consent.

 

(d)          In
the case of each Grantor that is a partner in a Partnership, such Grantor hereby consents to the extent required by the applicable
Partnership Agreement to the pledge by each other Grantor, pursuant to the terms hereof, of the Pledged Partnership Interests in
such Partnership and to the transfer of such Pledged Partnership Interests to the Administrative Agent or its nominee and to the
substitution of the Administrative Agent or its nominee as a substituted partner in such Partnership with all the rights, powers
and duties of a general partner or a limited partner, as the case may be. In the case of each Grantor that is a member of an LLC,
such Grantor hereby consents to the extent required by the applicable LLC Agreement to the pledge by each other Grantor, pursuant
to the terms hereof, of the Pledged LLC Interests in such LLC and to the transfer of such Pledged LLC Interests to the Administrative
Agent or its nominee and to the substitution of the Administrative Agent or its nominee as a substituted member of the LLC with
all the rights, powers and duties of a member of such LLC.

 

(e)          Such
Grantor shall not agree to any amendment of a Partnership Agreement or an LLC Agreement that (i) in any way adversely affects the
perfection of the security interest of the Administrative Agent in the Pledged Partnership Interests or Pledged LLC Interests pledged
by such Grantor hereunder or (ii) causes any Partnership Agreement or LLC Agreement to include an election to treat the membership
interests or partnership interests of such Grantor as a security under Section 8-103 of the Applicable UCC.

 

Section 5.7           Receivables.

 

(a)          Other
than in the ordinary course of business consistent with its past practice, such Grantor will not (i) grant any extension of the
time of payment of any Receivable, (ii) compromise or settle any Receivable for less than the full amount thereof, (iii) release,
wholly or partially, any Person liable for the payment of any Receivable, (iv) allow any credit or discount whatsoever on any Receivable
or (v) amend, supplement or modify any Receivable in any manner that could adversely affect the value thereof.

 

(b)          Such
Grantor will deliver to the Administrative Agent a copy of each material demand, notice or document received by it that questions
or calls into doubt the validity or enforceability of more than 5% of the aggregate amount of the then outstanding Receivables.

 

Section 5.8           Commercial
Tort Claims. If such Grantor shall obtain an interest in any Commercial Tort Claim with a potential value in excess of $100,000,
such Grantor shall within 30 days of a Responsible Officer obtaining knowledge of such interest sign and deliver documentation
acceptable to the Administrative Agent granting a security interest under the terms and provisions of this Agreement in and to
such Commercial Tort Claim.

 

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Section 5.9           Covenants
in Credit Agreement. Such Grantor shall take, or shall refrain from taking, as the case may be, each action that is necessary
to be taken or not taken, as the case may be, by it so that no Default or Event of Default is caused by the failure to take such
action or to refrain from taking such action by such Grantor.

 

ARTICLE
6.

REMEDIAL PROVISIONS

 

Section 6.1           Certain
Matters Relating to Receivables.

 

(a)          The
Administrative Agent shall have the right to make test verifications of the Receivables in any manner and through any medium that
it reasonably considers advisable, and each Grantor shall furnish all such assistance and information as the Administrative Agent
may require in connection with such test verifications.

 

(b)          The
Administrative Agent hereby authorizes each Grantor to collect such Grantor’s Receivables, subject to the Administrative
Agent’s direction and control, and the Administrative Agent may curtail or terminate said authority at any time after the
occurrence and during the continuance of an Event of Default. If required by the Administrative Agent at any time after the occurrence
and during the continuance of an Event of Default, any payments of Receivables, when collected by any Grantor, (i) shall be forthwith
(and, in any event, within two Business Days) deposited by such Grantor in the exact form received, duly indorsed by such Grantor
to the Administrative Agent if required, in a Collateral Account maintained under the sole dominion and control of the Administrative
Agent, subject to withdrawal by the Administrative Agent for the account of the Secured Persons only as provided in Section
6.5, and (ii) until so turned over, shall be held by such Grantor in trust for the Administrative Agent and the other Secured
Persons, segregated from other funds of such Grantor. Each such deposit of Proceeds of Receivables shall be accompanied by a report
identifying in reasonable detail the nature and source of the payments included in the deposit.

 

(c)          At
the Administrative Agent’s request at any time after the occurrence and during the continuance of an Event of Default, each
Grantor shall deliver to the Administrative Agent all original and other documents evidencing, and relating to, the agreements
and transactions which gave rise to the Receivables payable to such Grantor, including, without limitation, all original orders,
invoices and shipping receipts.

 

Section 6.2           Communications
with Obligors; Grantors Remain Liable.

 

(a)          The
Administrative Agent in its own name or in the name of others may at any time after the occurrence and during the continuance of
an Event of Default communicate with obligors under the Receivables to verify with them to the Administrative Agent’s satisfaction
the existence, amount and terms of any Receivables.

 

(b)          Upon
the request of the Administrative Agent at any time after the occurrence and during the continuance of an Event of Default, each
Grantor shall notify obligors on the Receivables payable to such Grantor that such Receivables have been assigned to the Administrative
Agent for the ratable benefit of the Secured Persons and that payments in respect thereof shall be made directly to the Administrative
Agent.

 

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(c)          Anything
herein to the contrary notwithstanding, each Grantor shall remain liable under each of the Receivables to observe and perform all
the conditions and obligations to be observed and performed by it thereunder, all in accordance with the terms of any agreement
giving rise thereto. Neither the Administrative Agent nor any other Secured Person shall have any obligation or liability under
any Receivable (or any agreement giving rise thereto) by reason of or arising out of this Agreement or the receipt by the Administrative
Agent or any other Secured Person of any payment relating thereto, nor shall the Administrative Agent or any other Secured Person
be obligated in any manner to perform any of the obligations of any Grantor under or pursuant to any Receivable (or any agreement
giving rise thereto), to make any payment, to make any inquiry as to the nature or the sufficiency of any payment received by it
or as to the sufficiency of any performance by any party thereunder, to present or file any claim, to take any action to enforce
any performance or to collect the payment of any amounts which may have been assigned to it or to which it may be entitled at any
time or times.

 

Section 6.3           Pledged
Securities.

 

(a)          Unless
an Event of Default shall have occurred and be continuing and the Administrative Agent shall have given notice to the relevant
Grantor of the Administrative Agent’s intent to exercise its corresponding rights pursuant to Section 6.3(b), each
Grantor shall be permitted to receive all cash dividends paid in respect of the Pledged Securities and all payments made in respect
of the Pledged Notes, to the extent permitted in the Credit Agreement, and to exercise all voting and corporate or other organizational
rights with respect to such Investment Property; provided, however, that no vote shall be cast or corporate or other organizational
right exercised or other action taken which, in the Administrative Agent’s reasonable judgment, would impair the Collateral
or which would be inconsistent with or result in any violation of any provision of the Credit Agreement, this Agreement or any
other Loan Document.

 

(b)          If
an Event of Default shall occur and be continuing and the Administrative Agent shall give notice of its intent to exercise such
rights to the relevant Grantor or Grantors, (i) the Administrative Agent shall have the right to receive any and all cash dividends,
payments or other Proceeds paid in respect of the Investment Property included in the Collateral and make application thereof to
the Secured Obligations in accordance with Section 6.5, and (ii) any or all of such Investment Property shall be registered
in the name of the Administrative Agent or its nominee, and the Administrative Agent or its nominee may thereafter exercise (x)
all voting, corporate and other rights pertaining to such Investment Property at any meeting of shareholders of the relevant Issuer
or Issuers or otherwise and (y) any and all rights of conversion, exchange and subscription and any other rights, privileges or
options pertaining to such Investment Property as if it were the absolute owner thereof (including, without limitation, the right
to exchange at its discretion any and all of such Investment Property upon the merger, consolidation, reorganization, recapitalization
or other fundamental change in the corporate or other organizational structure of any Issuer, or upon the exercise by any Grantor
or the Administrative Agent of any right, privilege or option pertaining to such Investment Property, and in connection therewith,
the right to deposit and deliver any and all of such Investment Property with any committee, depositary, transfer agent, registrar
or other designated agency upon such terms and conditions as the Administrative Agent may determine), all without liability except
to account for property actually received by it, but the Administrative Agent shall have no duty to any Grantor to exercise any
such right, privilege or option and shall not be responsible for any failure to do so or delay in so doing.

 

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(c)          Each
Grantor hereby authorizes and instructs each Issuer of any Investment Property included in the Collateral pledged by such Grantor
hereunder (i) to comply with any instruction received by it from the Administrative Agent in writing that (x) states that an Event
of Default has occurred and is continuing and (y) is otherwise in accordance with the terms of this Agreement, without any other
or further instructions from such Grantor, and each Grantor agrees that each Issuer shall be fully protected in so complying, and
(ii) if expressly required hereby, to pay any dividends or other payments with respect to such Investment Property directly to
the Administrative Agent.

 

Section 6.4           Proceeds
to Be Turned Over to Administrative Agent. In addition to the rights of the Administrative Agent and the Secured Persons specified
in Section 6.1 with respect to payments of Receivables, if an Event of Default shall occur and be continuing, all Proceeds
received by any Grantor consisting of cash, checks and other near-cash items shall be held by such Grantor in trust for the Administrative
Agent and the other Secured Persons, segregated from other funds of such Grantor, and shall, forthwith upon receipt by such Grantor,
be turned over to the Administrative Agent in the exact form received by such Grantor (duly indorsed by such Grantor to the Administrative
Agent, if required). All Proceeds received by the Administrative Agent hereunder shall be held by the Administrative Agent in a
Collateral Account maintained under its sole dominion and control. All Proceeds while held by the Administrative Agent in a Collateral
Account (or by such Grantor in trust for the Administrative Agent and the other Secured Persons) shall continue to be held as collateral
security for all the Secured Obligations and shall not constitute payment thereof until applied as provided in Section 6.5.

 

Section 6.5           Application
of Proceeds. At such intervals as may be agreed upon by the Borrower and the Administrative Agent, or, if an Event of Default
shall have occurred and be continuing, at any time at the Administrative Agent’s election, the Administrative Agent may apply
all or any part of Proceeds constituting Collateral, whether or not held in any Collateral Account, and any proceeds of the guarantee
set forth in Article 2, in payment of the Secured Obligations in accordance with Section 7.2 of the Credit Agreement.

 

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Section 6.6           Code
and Other Remedies. If an Event of Default shall occur and be continuing, the Administrative Agent, on behalf of the Secured
Persons, may exercise, in addition to all other rights and remedies granted to them in this Agreement and in any other instrument
or agreement securing, evidencing or relating to the Secured Obligations, all rights and remedies of a Secured Person under the
Applicable UCC or any other applicable law. Without limiting the generality of the foregoing, if an Event of Default has occurred
and is continuing, the Administrative Agent, without demand of performance or other demand, presentment, protest, advertisement
or notice of any kind (except any notice required by law referred to below) to or upon any Grantor or any other Person (all and
each of which demands, defenses, advertisements and notices are hereby waived), may in such circumstances forthwith collect, receive,
appropriate and realize upon the Collateral, or any part thereof, and/or may forthwith sell, lease, assign, give option or options
to purchase, or otherwise dispose of and deliver the Collateral or any part thereof (or contract to do any of the foregoing), in
one or more parcels at public or private sale or sales, at any exchange, broker’s board or office of the Administrative Agent
or any other Secured Person or elsewhere upon such terms and conditions as it may deem advisable and at such prices as it may deem
best, for cash or on credit or for future delivery without assumption of any credit risk. The Administrative Agent or any other
Secured Person shall have the right upon any such public sale or sales, and, to the extent permitted by law, upon any such private
sale or sales, to purchase the whole or any part of the Collateral so sold, free of any right or equity of redemption in any Grantor,
which right or equity is hereby waived and released. Each Grantor further agrees, at the Administrative Agent’s request,
to assemble the Collateral and make it available to the Administrative Agent at places which the Administrative Agent shall reasonably
select, whether at such Grantor’s premises or elsewhere. The Administrative Agent shall apply the net proceeds of any action
taken by it pursuant to this Section 6.6, after deducting all reasonable costs and expenses of every kind incurred in connection
therewith or incidental to the care or safekeeping of any of the Collateral or in any way relating to the Collateral or the rights
of the Administrative Agent and the other Secured Persons hereunder, including, without limitation, reasonable attorneys’
fees and disbursements, to the payment in whole or in part of the Secured Obligations, in such order as provided in Section
6.5, and only after such application and after the payment by the Administrative Agent of any other amount required by any
provision of law, including, without limitation, Section 9-615(a)(3) of the Applicable UCC, need the Administrative Agent account
for the surplus, if any, to any Grantor. To the extent permitted by applicable law, each Grantor waives all claims, damages and
demands it may acquire against the Administrative Agent or any other Secured Person arising out of the exercise by them of any
rights hereunder. If any notice of a proposed sale or other disposition of Collateral shall be required by law, such notice shall
be deemed reasonable and proper if given at least 10 days before such sale or other disposition.

 

Section 6.7           Restricted
Securities.

 

(a)          Each
Grantor recognizes that the Administrative Agent may be unable to effect a public sale of any or all the Pledged Securities, by
reason of certain prohibitions contained in the Securities Act and applicable state securities laws or otherwise, and may be compelled
to resort to one or more private sales thereof to a restricted group of purchasers which will be obliged to agree, among other
things, to acquire such securities for their own account for investment and not with a view to the distribution or resale thereof.
Each Grantor acknowledges and agrees that any such private sale may result in prices and other terms less favorable than if such
sale were a public sale and, notwithstanding such circumstances, agrees that any such private sale shall be deemed to have been
made in a commercially reasonable manner. The Administrative Agent shall be under no obligation to delay a sale of any of the Pledged
Securities for the period of time necessary to permit the Issuer thereof to register such securities for public sale under the
Securities Act, or under applicable state securities laws, even if such Issuer would agree to do so.

 

(b)          Each
Grantor agrees to use its best efforts to do or cause to be done all such other acts as may be necessary to make such sale or sales
of all or any portion of the Pledged Securities pursuant to this Section 6.7 valid and binding and in compliance with any
and all other applicable Governmental Requirements. Each Grantor further agrees that a breach of any of the covenants contained
in this Section 6.7 will cause irreparable injury to the Administrative Agent and the other Secured Persons, that the Administrative
Agent and the other Secured Persons have no adequate remedy at law in respect of such breach and, as a consequence, that each and
every covenant contained in this Section 6.7 shall be specifically enforceable against such Grantor, and such Grantor hereby
waives and agrees not to assert any defenses against an action for specific performance of such covenants except for a defense
that no Event of Default has occurred under the Credit Agreement.

 

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Section 6.8           Deficiency.
Each Grantor shall remain liable for any deficiency if the proceeds of any sale or other disposition of the Collateral are insufficient
to pay its Secured Obligations and the fees and disbursements of any attorneys employed by the Administrative Agent or any other
Secured Person to collect such deficiency.

 

ARTICLE
7.

THE ADMINISTRATIVE AGENT

 

Section 7.1           Administrative
Agent’s Appointment as Attorney-in-Fact, etc.

 

(a)          Each
Grantor hereby irrevocably constitutes and appoints the Administrative Agent and any officer or agent thereof, with full power
of substitution, as its true and lawful attorney-in-fact with full irrevocable power and authority in the place and stead of such
Grantor and in the name of such Grantor or in its own name, for the purpose of carrying out the terms of this Agreement, to take
any and all appropriate action and to execute any and all documents and instruments which may be necessary or desirable to accomplish
the purposes of this Agreement, and, without limiting the generality of the foregoing, each Grantor hereby gives the Administrative
Agent the power and right, on behalf of such Grantor, without notice to or assent by such Grantor, to do any or all of the following:

 

(i)          in
the name of such Grantor or its own name, or otherwise, take possession of and indorse and collect any checks, drafts, notes, acceptances
or other instruments for the payment of moneys due under any Receivable or with respect to any other Collateral and file any claim
or take any other action or proceeding in any court of law or equity or otherwise deemed appropriate by the Administrative Agent
for the purpose of collecting any and all such moneys due under any Receivable or with respect to any other Collateral whenever
payable;

 

(ii)         in
the case of any Intellectual Property, execute and deliver, and have recorded, any and all agreements, instruments, documents and
papers as the Administrative Agent may request to evidence the Administrative Agent’s security interest in such Intellectual
Property and the goodwill and general intangibles of such Grantor relating thereto or represented thereby;

 

(iii)        pay
or discharge taxes and Liens levied or placed on or threatened against the Collateral, effect any repairs or any insurance called
for by the terms of this Agreement and pay all or any part of the premiums therefor and the costs thereof;

 

(iv)        execute,
in connection with any sale provided for in Section 6.6 or Section 6.7, any endorsements, assignments or other instruments
of conveyance or transfer with respect to the Collateral; and

 

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(v)         (1)
direct any party liable for any payment under any of the Collateral to make payment of any and all moneys due or to become due
thereunder directly to the Administrative Agent or as the Administrative Agent shall direct; (2) ask or demand for, collect, and
receive payment of and receipt for, any and all moneys, claims and other amounts due or to become due at any time in respect of
or arising out of any Collateral; (3) sign and indorse any invoices, freight or express bills, bills of lading, storage or warehouse
receipts, drafts against debtors, assignments, verifications, notices and other documents in connection with any of the Collateral;
(4) commence and prosecute any suits, actions or proceedings at law or in equity in any court of competent jurisdiction to collect
the Collateral or any portion thereof and to enforce any other right in respect of any Collateral; (5) defend any suit, action
or proceeding brought against such Grantor with respect to any Collateral; (6) settle, compromise or adjust any such suit, action
or proceeding and, in connection therewith, give such discharges or releases as the Administrative Agent may deem appropriate;
(7) assign any Copyright, Patent or Trademark (along with the goodwill of the business to which any such Copyright, Patent or Trademark
pertains), throughout the world for such term or terms, on such conditions, and in such manner, as the Administrative Agent shall
in its sole discretion determine; and (8) generally, sell, transfer, pledge and make any agreement with respect to or otherwise
deal with any of the Collateral as fully and completely as though the Administrative Agent were the absolute owner thereof for
all purposes, and do, at the Administrative Agent’s option and such Grantor’s expense, at any time, or from time to
time, all acts and things which the Administrative Agent deems necessary to protect, preserve or realize upon the Collateral and
the Administrative Agent’s security interests therein and to effect the intent of this Agreement, all as fully and effectively
as such Grantor might do.

 

Anything in this Section
7.1(a) to the contrary notwithstanding, the Administrative Agent agrees that it will not exercise any rights under the power
of attorney provided for in this Section 7.1(a) unless an Event of Default shall have occurred and be continuing.

 

(b)          If
any Grantor fails to perform or comply with any of its agreements contained herein, the Administrative Agent, at its option, but
without any obligation so to do, may perform or comply, or otherwise cause performance or compliance, with such agreement.

 

(c)          The
expenses of the Administrative Agent incurred in connection with actions undertaken as provided in this Section 7.1, together
with interest thereon at a rate per annum equal to the highest rate per annum at which interest would then be payable on any category
of past due Base Rate Loans under the Credit Agreement, from the date of payment by the Administrative Agent to the date reimbursed
by the relevant Grantor, shall be payable by such Grantor to the Administrative Agent on demand.

 

(d)          Each
Grantor hereby ratifies all that said attorneys shall lawfully do or cause to be done by virtue hereof and in accordance with the
terms hereof. All powers, authorizations and agencies contained in this Agreement are coupled with an interest and are irrevocable
until this Agreement is terminated and the security interests created hereby are released.

 

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Section 7.2           Duty
of Administrative Agent. The Administrative Agent’s sole duty with respect to the custody, safekeeping and physical preservation
of the Collateral in its possession, under Section 9-207 of the Applicable UCC or otherwise, shall be to deal with it in the same
manner as the Administrative Agent deals with similar property for its own account. Neither the Administrative Agent, any other
Secured Person nor any of their respective officers, directors, employees or agents shall be liable for failure to demand, collect
or realize upon any of the Collateral or for any delay in doing so or shall be under any obligation to sell or otherwise dispose
of any Collateral upon the request of any Grantor or any other Person or to take any other action whatsoever with regard to the
Collateral or any part thereof. The powers conferred on the Administrative Agent and the Secured Persons hereunder are solely to
protect the Administrative Agent’s and the Secured Persons’ interests in the Collateral and shall not impose any duty
upon the Administrative Agent or any Secured Person to exercise any such powers. The Administrative Agent and the other Secured
Persons shall be accountable only for amounts that they actually receive as a result of the exercise of such powers, and neither
they nor any of their officers, directors, employees or agents shall be responsible to any Grantor for any act or failure to act
hereunder, except for their own gross negligence or willful misconduct as determined by a court of competent jurisdiction in a
final, non-appealable judgement.

 

Section 7.3           Authentication
of Financing Statements. Each Grantor acknowledges that pursuant to Section 9-509(b) of the Applicable UCC and any other applicable
law, by executing this Agreement such Grantor authorizes the Administrative Agent to file or record financing or continuation statements,
and amendments thereto, and other filing or recording documents or instruments with respect to the Collateral, without the signature
of such Grantor, in such form and in such offices as the Administrative Agent reasonably determines appropriate to perfect or maintain
the perfection of the security interests of the Administrative Agent under this Agreement. Each Grantor further agrees that such
financing statements may describe the Collateral in the same manner as described in this Agreement or as “all assets,”
“all personal property” or words of similar effect, regardless of whether or not the Collateral includes all assets
or all personal property of such Grantor, or such other description as the Administrative Agent, in its sole judgment, determines
is necessary or advisable that is of an equal or lesser scope or with greater detail.

 

Section 7.4           Authority
of Administrative Agent. Each Grantor acknowledges that the rights and responsibilities of the Administrative Agent under this
Agreement with respect to any action taken by the Administrative Agent or the exercise or non-exercise by the Administrative Agent
of any option, voting right, request, judgment or other right or remedy provided for herein or resulting or arising out of this
Agreement shall, as between the Administrative Agent and the other Secured Persons, be governed by the Credit Agreement and by
such other agreements with respect thereto as may exist from time to time among them, but, as between the Administrative Agent
and the Grantors, the Administrative Agent shall be conclusively presumed to be acting as agent for the Secured Persons with full
and valid authority so to act or refrain from acting, and no Grantor shall be under any obligation, or entitlement, to make any
inquiry respecting such authority.

 

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ARTICLE
8.

SUBORDINATION OF GRANTOR CLAIMS

 

Section 8.1           Subordination
of Grantor Claims. As used herein, the term “Grantor Claims” shall mean all debts and obligations of any
Grantor to any other Grantor, whether such debts and obligations now exist or are hereafter incurred or arise, or whether the obligation
of the debtor thereon be direct, contingent, primary, secondary, several, joint and several, or otherwise, and irrespective of
whether such debts or obligations be evidenced by note, contract, open account, or otherwise, and irrespective of the Person or
Persons in whose favor such debts or obligations may, at their inception, have been, or may hereafter be created, or the manner
in which they have been or may hereafter be acquired by. After the occurrence and during the continuation of an Event of Default,
no Grantor shall receive or collect, directly or indirectly, from any obligor in respect thereof any amount upon the Grantor Claims.

 

Section 8.2           Claims
in Bankruptcy. In the event of receivership, bankruptcy, reorganization, arrangement, debtor’s relief, or other insolvency
proceedings involving any Grantor, the Administrative Agent on behalf of the Administrative Agent and the Secured Persons shall
have the right to prove their claim in any proceeding, so as to establish their rights hereunder and receive directly from the
receiver, trustee or other court custodian, dividends and payments which would otherwise be payable upon Grantor Claims. After
any such event, each Grantor hereby assigns such dividends and payments to the Administrative Agent for the benefit of the Administrative
Agent and the Secured Persons for application against the Obligations as provided under Section 7.2 of the Credit Agreement. Should
the Administrative Agent or any Secured Person receive, for application upon the Obligations, any such dividend or payment which
is otherwise payable to any Grantor, and which, as between such Grantors, shall constitute a credit upon the Grantor Claims, then
upon the Termination Date, the intended recipient shall become subrogated to the rights of the Administrative Agent and the Secured
Persons to the extent that such payments to the Administrative Agent and the Secured Persons on the Grantor Claims have contributed
toward the liquidation of the Obligations, and such subrogation shall be with respect to that proportion of the Obligations which
would have been unpaid if the Administrative Agent and the Secured Persons had not received dividends or payments upon the Grantor
Claims.

 

Section 8.3           Payments
Held in Trust. In the event that, notwithstanding Section 8.1 and Section 8.2, any Grantor should receive any
funds, payments, claims or distributions which is prohibited by such Sections, then it agrees: (a) to hold in trust for the Administrative
Agent and the other Secured Persons an amount equal to the amount of all funds, payments, claims or distributions so received and
(b) that it shall have absolutely no dominion over the amount of such funds, payments, claims or distributions except to pay them
promptly to the Administrative Agent, for the benefit of the Secured Persons; and each Grantor covenants promptly to pay the same
to the Administrative Agent.

 

Section 8.4           Liens
Subordinate. Each Grantor agrees that, until the Termination Date, any Liens securing payment of the Grantor Claims shall be
and remain inferior and subordinate to any Liens securing payment of the Obligations, regardless of whether such encumbrances in
favor of such Grantor, the Administrative Agent or any other Secured Person presently exist or are hereafter created or attach.
Without the prior written consent of the Administrative Agent, no Grantor shall, until the Termination Date, (a) exercise or enforce
any creditor’s right it may have against any debtor in respect of the Grantor Claims or (b) foreclose, repossess, sequester
or otherwise take steps or institute any action or proceeding (judicial or otherwise, including without limitation the commencement
of or joinder in any liquidation, bankruptcy, rearrangement, debtor’s relief or insolvency proceeding) to enforce any Lien
held by it.

 

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Section 8.5           Notation
of Records. Upon the request of the Administrative Agent, all promissory notes and all accounts receivable ledgers or other
evidence of the Grantor Claims accepted by or held by any Grantor shall contain a specific written notice thereon that the indebtedness
evidenced thereby is subordinated under the terms of this Agreement.

 

ARTICLE
9.

MISCELLANEOUS

 

Section 9.1           Amendments
in Writing. None of the terms or provisions of this Agreement may be waived, amended, supplemented or otherwise modified except
in accordance with Section 9.2(b) of the Credit Agreement.

 

Section 9.2           Notices.
All notices, requests and demands to or upon the Administrative Agent or any Grantor hereunder shall be effected in the manner
provided for in Section 9.1 of the Credit Agreement; provided that any such notice, request or demand to or upon any Guarantor
shall be addressed to such Guarantor at its notice address set forth on Schedule 1.

 

Section 9.3           No
Waiver by Course of Conduct; Cumulative Remedies. Neither the Administrative Agent nor any other Secured Person shall by any
act (except by a written instrument pursuant to Section 9.1), delay, indulgence, omission or otherwise be deemed to have
waived any right or remedy hereunder or to have acquiesced in any Default or Event of Default. No failure to exercise, nor any
delay in exercising, on the part of the Administrative Agent or any other Secured Person, any right, power or privilege hereunder
shall operate as a waiver thereof. No single or partial exercise of any right, power or privilege hereunder shall preclude any
other or further exercise thereof or the exercise of any other right, power or privilege. A waiver by the Administrative Agent
or any other Secured Person of any right or remedy hereunder on any one occasion shall not be construed as a bar to any right or
remedy which the Administrative Agent or such other Secured Person would otherwise have on any future occasion. The rights and
remedies herein provided are cumulative, may be exercised singly or concurrently and are not exclusive of any other rights or remedies
provided by law.

 

Section 9.4           Enforcement
Expenses; Indemnification.

 

(a)          Each
Grantor agrees to pay or reimburse the Administrative Agent and each other Secured Person for all advances, charges, costs and
expenses (including, without limitation, all costs and expenses of holding, preparing for sale and selling, collecting or otherwise
realizing upon the Collateral and all attorneys’ fees, legal expenses and court costs) incurred by the Administrative Agent
or any other Secured Person in connection with the exercise of its respective rights and remedies hereunder, including, without
limitation, any advances, charges, costs and expenses that may be incurred in any effort to enforce any of the provisions of this
Agreement or any obligation of any Grantor in respect of the Collateral or in connection with (i) the preservation of the Lien
of, or the rights of the Administrative Agent or any other Secured Person under this Agreement, (ii) any actual or attempted sale,
lease, disposition, exchange, collection, compromise, settlement or other realization in respect of, or care of, the Collateral,
including all such costs and expenses incurred in any bankruptcy, reorganization, workout or other similar proceeding, or (iii)
collecting against any Guarantor under the guarantee contained in Article 2 or otherwise enforcing or preserving any rights
under this Agreement and the other Loan Documents to which any Grantor is a party, including, without limitation, the reasonable
out-of-pocket fees and disbursements of counsel to each Secured Person and of counsel to the Administrative Agent.

 

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(b)          Each
Grantor agrees to pay, and to save the Administrative Agent and the other Secured Persons harmless from, any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever
(including, without limitation, court costs and reasonable out-of-pocket attorneys’ fees, any and all liabilities with respect
to, or resulting from any delay in paying, any and all stamp, excise, sales or other taxes which may be payable or determined to
be payable with respect to any of the Collateral or in connection with any of the transactions contemplated by this Agreement)
incurred because of, incident to, or with respect to, the Collateral (including, without limitation, any exercise of rights or
remedies in connection therewith) with respect to the execution, delivery, enforcement, performance and administration of this
Agreement to the extent that the Borrower would be required to do so pursuant to Section 9.3 of the Credit Agreement. All amounts
for which any Grantor is liable pursuant to this Section 9.4 shall be due and payable by such Grantor to the Secured Persons
upon demand.

 

(c)          The
agreements in this Section 9.4 shall survive the termination of this Agreement and the other Loan Documents and the repayment
of the Obligations and all other amounts payable under the Credit Agreement and the other Loan Documents.

 

Section 9.5           Successors
and Assigns. This Agreement shall be binding upon the successors and assigns of each Grantor and shall inure to the benefit
of the Administrative Agent and the other Secured Persons and their successors and assigns; provided that no Grantor may
assign, transfer or delegate any of its rights or obligations under this Agreement without the prior written consent of the Administrative
Agent.

 

Section 9.6           Set-Off.
In addition to any rights and remedies of the Secured Persons provided by law, each Secured Person shall have the right, without
notice to any Grantor, any such notice being expressly waived by each Grantor to the extent permitted by applicable law, upon any
Secured Obligations becoming due and payable by any Grantor (whether at the stated maturity, by acceleration or otherwise), to
apply to the payment of such Secured Obligations, by setoff or otherwise, any and all deposits (general or special, time or demand,
provisional or final), in any currency, and any other credits, indebtedness or claims, in any currency, in each case whether direct
or indirect, absolute or contingent, matured or unmatured, at any time held or owing by such Secured Person, any affiliate thereof
or any of their respective branches or agencies to or for the credit or the account of such Grantor. Each Secured Person agrees
promptly to notify the relevant Grantor and the Administrative Agent after any such application made by such Secured Person; provided
that the failure to give such notice shall not affect the validity of such application.

 

Section 9.7           Counterparts.
This Agreement may be executed by one or more of the parties to this Agreement on any number of separate counterparts, and all
of said counterparts taken together shall be deemed to constitute one and the same instrument. Delivery of an executed signature
page of this Agreement by e-mail or facsimile transmission shall be effective as delivery of a manually executed counterpart hereof.

 

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Section 9.8           Severability.
Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition
or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

 

Section 9.9           Section
Headings. The Section headings used in this Agreement are for convenience of reference only and are not to affect the construction
hereof or be taken into consideration in the interpretation hereof.

 

Section 9.10         INTEGRATION.
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE ENTIRE AGREEMENT OF THE GRANTORS, THE ADMINISTRATIVE AGENT AND THE OTHER
SECURED PERSONS WITH RESPECT TO THE SUBJECT MATTER HEREOF AND THEREOF, AND THERE ARE NO PROMISES, UNDERTAKINGS, REPRESENTATIONS
OR WARRANTIES BY THE ADMINISTRATIVE AGENT OR ANY OTHER SECURED PERSON RELATIVE TO SUBJECT MATTER HEREOF AND THEREOF NOT EXPRESSLY
SET FORTH OR REFERRED TO HEREIN OR IN THE OTHER LOAN DOCUMENTS. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

 

Section 9.11         GOVERNING
LAW. THIS AGREEMENT, THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT AND ANY CLAIM OR CONTROVERSY ARISING OUT
OF OR RELATED TO THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
NEW YORK.

 

Section 9.12         JURISDICTION.

 

(a)          EACH
PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE
COURT FROM EITHER THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE NOTES, OR THE OTHER LOAN
DOCUMENTS, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY
AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR,
TO THE EXTENT PERMITTED BY LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION
OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED
BY LAW. NOTHING IN THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT, ANY OF THE OTHER
AGENTS, THE ISSUING BANK OR ANY OTHER SECURED PERSON MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT
AGAINST THE BORROWER OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION. EACH OF THE PARTIES HERETO AGREES THAT NOTHING HEREIN
SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT TO SUE IN ANY
OTHER JURISDICTION.

 

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(b)          EACH
PARTY TO THIS AGREEMENT IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 9.2. NOTHING
IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY TO THIS AGREEMENT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.

 

(c)          EACH
PARTY TO THIS AGREEMENT WAIVES, TO THE MAXIMUM EXTENT NOT PROHIBITED BY LAW, ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY LEGAL
ACTION OR PROCEEDING REFERRED TO IN THIS SECTION 9.12 ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES.

 

Section 9.13         Acknowledgements.
Each Grantor hereby acknowledges that:

 

(a)          it
has been advised by counsel in the negotiation, execution and delivery of this Agreement and the other Loan Documents to which
it is a party;

 

(b)          neither
the Administrative Agent nor any other Secured Person has any fiduciary relationship with or duty to any Grantor arising out of
or in connection with this Agreement or any of the other Loan Documents, and the relationship between the Grantors, on the one
hand, and the Administrative Agent and the other Secured Persons, on the other hand, in connection herewith or therewith is solely
that of debtor and creditor;

 

(c)          no
joint venture is created hereby or by the other Loan Documents or otherwise exists by virtue of the transactions contemplated hereby
among the Secured Persons or among the Grantors and the Secured Persons;

 

(d)          it
has a duty to read this Agreement and the other Loan Documents and agrees that it is charged with notice and knowledge of the terms
of this Agreement and the other Loan Documents; that it has in fact read this Agreement and is fully informed and has full notice
and knowledge of the terms, conditions and effects of this Agreement; that it has been represented by independent legal counsel
of its choice throughout the negotiations preceding its execution of this Agreement and the other Loan Documents; and has received
the advice of its attorney in entering into this Agreement and the Loan Documents to which it is a party; and that it recognizes
that certain of the terms of this Agreement and the other Loan Documents result in one party assuming the liability inherent in
some aspects of the transaction and relieving the other party of its responsibility for such liability. SUCH GRANTOR AGREES
AND COVENANTS THAT IT WILL NOT CONTEST THE VALIDITY OR ENFORCEABILITY OF ANY EXCULPATORY PROVISION OF THIS AGREEMENT AND THE OTHER
LOAN DOCUMENTS ON THE BASIS THAT THE PARTY HAD NO NOTICE OR KNOWLEDGE OF SUCH PROVISION OR THAT THE PROVISION IS NOT “CONSPICUOUS”;
and

 

    	28

    	 

    

 

(e)          each
of the waivers and consents set forth in this Agreement are made voluntarily and unconditionally after consultation with outside
legal counsel and with full knowledge of their significance and consequences, with the understanding that events giving rise to
any defense or right waived may diminish, destroy or otherwise adversely affect rights which such Grantor otherwise may have against
the Borrower, any other Grantor, the Secured Persons or any other Person or against any collateral. If, notwithstanding
the intent of the parties that the terms of this Agreement shall control in any and all circumstances, any such waivers or consents
are determined to be unenforceable under applicable law, such waivers and consents shall be effective to the maximum extent permitted
by law.

 

Section 9.14         Additional
Grantors; Additional Pledged Securities. Each Subsidiary of the Borrower that is required to become a party to this Agreement
pursuant to Section 5.9 of the Credit Agreement shall become a Grantor for all purposes of this Agreement upon execution and delivery
by such Subsidiary of an Assumption Agreement. Each Grantor that is required to pledge additional Equity Interests pursuant
to the Credit Agreement shall execute and deliver to the Administrative Agent a Supplement.

 

Section 9.15         Releases.

 

(a)          Upon
the Termination Date, the Collateral shall be released from the Liens created hereby, and this Agreement and all obligations (other
than those expressly stated to survive such termination) of the Administrative Agent and each Grantor hereunder shall terminate,
all without delivery of any instrument or performance of any act by any party, and all rights to the Collateral shall revert to
the Grantors. At the request and sole expense of any Grantor following any such termination, the Administrative Agent shall
deliver to such Grantor any Collateral held by the Administrative Agent hereunder, and execute and deliver to such Grantor such
documents as such Grantor shall reasonably request to evidence such termination.

 

(b)          If
any of the Collateral shall be sold, transferred or otherwise disposed of by any Grantor in a transaction permitted by the Credit
Agreement, then the Administrative Agent, at the request and sole expense of such Grantor, shall execute and deliver to such Grantor
all releases or other documents reasonably necessary or desirable for the release of the Liens created hereby on such Collateral.
At the request and sole expense of the Borrower, a Guarantor shall be released from its obligations hereunder in the event
that all the Equity Interests of such Guarantor shall be sold, transferred or otherwise disposed of in a transaction permitted
by the Credit Agreement; provided that the Borrower shall have delivered to the Administrative Agent, at least 10 Business
Days prior to the date of the proposed release, a written request for release identifying the relevant Guarantor and the terms
of the sale or other disposition in reasonable detail, including the price thereof and any expenses in connection therewith, together
with a certification by the Borrower stating that such transaction is in compliance with the Credit Agreement and the other Loan
Documents.

 

Section 9.16         Acceptance.
Each Grantor hereby expressly waives notice of acceptance of this Agreement, acceptance on the part of the Administrative Agent
and the other Secured Persons being conclusively presumed by their request for this Agreement and delivery of the same to the Administrative
Agent.

 

    	29

    	 

    

 

Section 9.17         Retention
in Satisfaction. Except as may be expressly applicable pursuant to Section 9-620 of the Applicable UCC, no action taken or
omission to act by the Administrative Agent or the other Secured Persons hereunder, including, without limitation, any exercise
of voting or consensual rights or any other action taken or inaction, shall be deemed to constitute a retention of the Collateral
in satisfaction of the Obligations or otherwise to be in full satisfaction of the Obligations, and the Obligations shall remain
in full force and effect, until the Administrative Agent and the other Secured Persons shall have applied payments (including,
without limitation, collections from Collateral) towards the Obligations in the full amount then outstanding or until such subsequent
time as is provided in Section 6.5.

 

Section 9.18         Reinstatement.
The obligations of each Grantor under this Agreement (including, without limitation, with respect to the guarantee contained in
Article 2 and the provision of collateral herein) shall continue to be effective, or be reinstated, as the case may be,
if at any time payment, or any part thereof, of any of the Secured Obligations is rescinded or must otherwise be restored or returned
by the Administrative Agent or any other Secured Person upon the insolvency, bankruptcy, dissolution, liquidation or reorganization
of the Borrower or any other Grantor, or upon or as a result of the appointment of a receiver, intervenor or conservator of, or
trustee or similar officer for, the Borrower or any other Grantor or any substantial part of its property, or otherwise, all as
though such payments had not been made.

 

Section 9.19         WAIVER
OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO
A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THE LOAN DOCUMENTS OR THE TRANSACTIONS
CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (a) CERTIFIES THAT NO REPRESENTATIVE,
AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (b) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO
ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.19.

 

Section 9.20         Keepwell.
Each Qualified ECP Guarantor hereby jointly and severally absolutely, unconditionally and irrevocably undertakes to provide such
funds or other support as may be needed from time to time by each other Grantor to honor all of its obligations under this Agreement
in respect of Hedging Obligations (provided, however, that each Qualified ECP Guarantor shall only be liable under this
Section 9.20 for the maximum amount of such liability that can be hereby incurred without rendering its obligations under
this Section 9.20, or otherwise under this Agreement, voidable under applicable law relating to fraudulent conveyance or
fraudulent transfer, and not for any greater amount). The obligations of each Qualified ECP Guarantor under this Section
9.20 shall remain in full force and effect until all amounts owing to the Secured Persons on account of the Obligations are
irrevocably and indefeasibly paid in full in cash, no Letter of Credit shall be outstanding and all of the Commitments are terminated.
Each Qualified ECP Guarantor intends that this Section 9.20 constitute, and this Section 9.20 shall be deemed
to constitute, a “keepwell, support, or other agreement” for the benefit of each other Grantor for all purposes of
Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

 

[Signature Pages Follow]

 

    	30

    	 

    

 

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

 

	BORROWER:	AMERICAN EAGLE ENERGY CORPORATION
	 	 	 
	 	By:	/s/ Brad Colby
	 	Name: Brad Colby
	 	Title:   Chief Executive Officer
	 	 	 
	GUARANTOR:	AMZG, INC.
	 	 	 
	 	By:	/s/ Brad Colby 
	 	Name: Brad Colby
	 	Title:   President

 

Signature Page to Guarantee and Collateral
Agreement

 

    	 

    	 

    

  

Acknowledged and Agreed to

as of the date first above written by:

 

	ADMINISTRATIVE AGENT:	SUNTRUST BANK, as Administrative Agent
	 	 	 
	 	By:	/s/ Scott A. Mackey 
	 	Name:  Scott A. Mackey
	 	Title:    Director

 

Signature Page to Guarantee and Collateral
Agreement

  

    	 

    	 

    

Schedule 1

 

NOTICE ADDRESSES OF GUARANTORS

 

AMZG, Inc.

c/o American Eagle Energy
Corporation

2549 W. Main Street, Suite
202,

Littleton, Colorado 80120

Attention: Brad Colby, Chief
Executive Officer

Telecopy No. 303-798-5767

 

With copies to:

 

Baker &
Hostetler LLP

600 Anton
Blvd., Suite 900

Costa Mesa,
California 92626

Attention:
Randolf W. Katz, Esq.

Telecopy
No. 714-966-8802

 

and

 

Roberts &
Olivia, LLC

2060 Broadway;
Suite 250

Boulder,
Colorado 80302

Attention:
William R. Roberts, Esq.

Telecopy
No. 720-210-5447

    	Schedule 1 - 1

    	 

    

Schedule 2

 

DESCRIPTION OF INVESTMENT PROPERTY

 

Pledged Securities:

 

	

Owner/Grantor	Issuer	Percentage 

Owned	Percentage of

Owned

Shares

Pledged	Class of 

Stock or 

Other Equity 

Interests	No. of 

Shares	Certificated or 

Uncertificated	Certificate 

No.
	American Eagle Energy Corporation	AMZG, Inc.	100%	100%	Common	100	Certificated	1001
	American Eagle Energy Corporation	EERG Energy ULC	100%	65%	Class “A” Common	100	Certificated	A-2
	AMZG, Inc.	AEE Canada Inc.	100%	65%	Class “A” Common	100	Certificated	A-2
	American Eagle Energy Corporation	Crescent Point Energy Corp.	Minority Interest	100%	Common Shares	30,640 as of July 31, 2014	Uncertificated	N/A
	American Eagle Energy Corporation	Powder Mountain Energy LTD.1	Minority Interest	100%	Common Shares	33,333	Certificated	4466006 and 3820954
	AMZG, Inc.	Powder Mountain Energy LTD.1	Minority Interest	100%	Common Shares	33,333	Certificated	
        4207028

        and 446605

 

1. The certificates reflect (i) 1,000,000
shares issued by Passport Energy Ltd. to Eternal Energy Corp. (the predecessor to American Eagle Energy Corporation) and American
Eagle Energy Corporation and (ii) 1,000,000 shares issued by Passport Energy Ltd. to American Eagle Energy Inc. (the predecessor
to AMZG, Inc. In May 2014, Passport declared a 1-for-6 reverse stock split, with reduced the aggregate number of shares owned by
each entity from 1,000,000 to 166,667. In June 2014, Passport was merged into Amarok Energy to on a 1-for-1 share basis. Amarok
then proceeded to declare a 5-for-1 reverse stock split, which further reduced the aggregate number of shares owned by each entity
from 166,667 to 33,333. Immediately after the merger and reverse split, Amarok changed its name to Powder Mountain Energy Ltd.
The shares represent the current ownership interests of American Eagle Energy Corporation and AMZG, Inc.

 

Pledged Notes:

 

None.

 

    	Schedule 2 - 1

    	 

    

Schedule 3

 

FILINGS AND OTHER ACTIONS

REQUIRED TO PERFECT SECURITY INTERESTS

 

Uniform Commercial Code Filings

 

Filing of UCC-1 Financing Statements naming
the Administrative Agent as Secured Person with respect to the following Grantors as debtors in the Office of the Secretary of
State in the State indicated below:

 

	Debtor	 	State
	American Eagle Energy Corporation	 	Nevada
	AMZG, Inc.	 	Nevada

 

As-Extracted Collateral Filings

 

Filing of UCC-1 Financing Statements or original
executed Mortgages in the form agreed upon by the applicable Grantors and the Administrative Agent notating that the applicable
Collateral is As-Extracted Collateral, naming the Administrative Agent as Secured Party with respect to the following Grantors
as debtors in the recorder’s office of the following counties:

 

	Debtor	 	County
	American Eagle Energy Corporation	 	
        Divide County, ND

        Williams County, ND

        Daniels County, MT

        Richland County, MT

        Roosevelt County, MT

        Sheridan County, MT

  

    	Schedule 3 - 1

    	 

    

 

	AMZG, Inc.	 	
        Divide County, ND

        Williams County, ND

        Daniels County, MT

        Richland County, MT

        Roosevelt County, MT

        Sheridan County, MT

 

Fixture Filings

 

Filing of UCC-1 Financing Statements or original
executed Mortgages in the form agreed upon by the applicable Grantors and the Administrative Agent notating that the applicable
Collateral is Fixtures, naming the Administrative Agent as Secured Party with respect to the following Grantors as debtors in the
recorder’s office of the following counties:

 

	Debtor	 	County
	American Eagle Energy Corporation	 	
        Divide County, ND

        Williams County, ND

        Daniels County, MT

        Richland County, MT

        Roosevelt County, MT

        Sheridan County, MT

	AMZG, Inc.	 	
        Divide County, ND

        Williams County, ND

        Daniels County, MT

        Richland County, MT

        Roosevelt County, MT

        Sheridan County, MT

 

    	Schedule 3 - 2

    	 

    

Schedule 4

 

LOCATION OF JURISDICTION OF ORGANIZATION

AND CHIEF EXECUTIVE OFFICE

 

Grantor: American Eagle Energy Corporation

Other Names and Trade Names Used in the Last
Five Years: Eternal Energy Corp.

Jurisdictions of Organization over the Last
Five Years: Nevada

Current Jurisdiction of Organization: Nevada

Organizational Number:  C17822-2003

Tax ID Number: 20-0237026

Location of Chief Executive Office over the
last Five Years: 2549 W. Main Street, Suite 202, Littleton, Colorado 80120

Current Location of Chief
Executive: 2549 W. Main Street, Suite 202, Littleton, Colorado 80120

 

Grantor: AMZG, Inc.

Other Names and Trade Names Used in the Last
Five Years: Yellow Hill Energy Inc. and American Eagle Energy, Inc.

Jurisdictions of Organization over the Last
Five Years: Nevada

Current Jurisdiction of Organization: Nevada

Organizational Number: E0181062007-5

Tax ID Number: 20-8642477

Location of
Chief Executive Office over the last Five Years:

 

Since December
2011:

2549 W. Main
Street, Suite 202

Littleton,
Colorado 80120

 

Previous:

27 North 27th
Street, Suite 12G

Billings, Montana
59101

  

Current Location
of Chief Executive: 2549 W. Main Street, Suite 202, Littleton, Colorado 80120

 

    	Schedule 4 - 1

    	 

    

Schedule 5

 

COPYRIGHTS AND COPYRIGHT LICENSES

 

None.

 

PATENTS AND PATENT LICENSES

 

None.

 

TRADEMARKS AND TRADEMARK LICENSES

 

None.

 

    	Schedule 5 - 1

    	 

    

Schedule 6

 

DEPOSIT ACCOUNTS, SECURITIES ACCOUNTS
AND COMMODITY ACCOUNTS

 

	Grantor	 	Type
    of Account	 	Name
    & Address of Financial 

    Institutions
	American Eagle Energy Corporation	 	Payables Account

765070012958	 	Key Bank

PO Box 93885, Cleveland, OH 44101-5885
	American Eagle Energy Corporation	 	Revenue Account

765071003428	 	Key Bank

PO Box 93885, Cleveland, OH 44101-5885
	American Eagle Energy Corporation	 	Money Market Account

765070014905	 	Key Bank

PO Box 93885, Cleveland, OH 44101-5885
	AMZG, Inc.	 	Payables Account

765071002552	 	Key Bank

PO Box 93885, Cleveland, OH 44101-5885
	American Eagle Energy Corporation	 	Brokerage Account

	 	Wells Fargo Advisors

1333 Noel Road, Suite 1500, Dallas, Texas 75240

 

    	Schedule 6 - 1

    	 

    

Annex 1 to

Guarantee and Collateral Agreement

 

ACKNOWLEDGEMENT AND CONSENT***

 

The undersigned hereby
acknowledges receipt of a copy of the Guarantee and Collateral Agreement dated as of August 27, 2014 (the “Agreement”),
made by the Grantors parties thereto for the benefit of SunTrust Bank, as Administrative Agent. The undersigned agrees for
the benefit of the Administrative Agent and the other Secured Persons as follows:

 

1.          The
undersigned will be bound by the terms of the Agreement and will comply with such terms insofar as such terms are applicable to
the undersigned.

 

2.          The
undersigned will notify the Administrative Agent promptly in writing of the occurrence of any of the events described in Section
5.6(a) of the Agreement.

 

3.          The
terms of Sections 6.3(c) and Section 6.7 of the Agreement shall apply to it, mutatis mutandis, with
respect to all actions that may be required of it pursuant to Sections 6.3(c) or Section 6.7 of the Agreement.

 

	 	[NAME OF ISSUER]
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:

 

	 	Address for Notices:
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	Fax:

 

 

 

		***	This consent is necessary only with respect to any Issuer
which is not also a Grantor. This consent may be modified or eliminated with respect to any Issuer that is not controlled
by a Grantor. If a consent is required, its execution and delivery should be included among the conditions to the initial
borrowing specified in the Credit Agreement.

 

    	Annex 1 - 1

    	 

    

Annex 2 to

Guarantee and Collateral Agreement

 

ASSUMPTION AGREEMENT
(this “Assumption Agreement”), dated as of [●], 201[●], made by [●] (the “Additional
Grantor”), in favor of SunTrust Bank, as administrative agent (in such capacity, the “Administrative Agent”)
for the banks and other financial institutions or entities (the “Lenders”) parties to the Credit Agreement referred
to below. All capitalized terms not defined herein shall have the meaning ascribed to them in such Credit Agreement.

 

WITNESSETH:

 

WHEREAS, American Eagle
Energy Corporation, a Nevada corporation (the “Borrower”), the Lenders and the Administrative Agent have entered
into a Credit Agreement, dated as of August 27, 2014 (as amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”);

 

WHEREAS, in connection
with the Credit Agreement, the Borrower and certain of its Affiliates (other than the Additional Grantor) have entered into the
Guarantee and Collateral Agreement, dated as of August 27, 2014 (as amended, supplemented or otherwise modified from time to time,
the “Guarantee and Collateral Agreement”) in favor of the Administrative Agent for the ratable benefit of the
Secured Persons;

 

WHEREAS, the Credit
Agreement requires the Additional Grantor to become a party to the Guarantee and Collateral Agreement; and

 

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

 

NOW, THEREFORE, IT
IS AGREED:

 

1.          Guarantee
and Collateral Agreement. By executing and delivering this Assumption Agreement, the Additional Grantor, as provided
in Section 9.14 of the Guarantee and Collateral Agreement, hereby becomes a party to the Guarantee and Collateral Agreement
as a Grantor and a Guarantor thereunder with the same force and effect as if originally named therein as a Grantor and a Guarantor
and, without limiting the generality of the foregoing, hereby expressly (a) assumes all obligations and liabilities of a Grantor
and a Guarantor thereunder; (b) guarantees the Obligations pursuant to Article 2 of the Guarantee and Collateral Agreement;
and (c) 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 the Schedules to the Guarantee and Collateral Agreement. The Additional
Grantor hereby represents and warrants that each of the representations and warranties contained in Article 4 of the Guarantee
and Collateral Agreement, as they relate to the Additional Grantor and its Collateral, is true and correct in all material respects
on and as the date hereof (after giving effect to this Assumption Agreement) as if made on and as of such date, except to the extent
that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct in
all material respects as of such earlier date (except that any such representations and warranties that are qualified materially
shall be true and correct in all respects).

 

    	Annex 2 - 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 2 - 2

    	 

    

Annex 1-A to

Assumption Agreement

 

Supplement to Schedule 1

 

Supplement to Schedule 2

 

Supplement to Schedule 3

 

Supplement to Schedule 4

 

Supplement to Schedule 5

 

Supplement to Schedule 6

 

    	Annex 1-A - 1

    	 

    

Annex 3 to

Guarantee and Collateral Agreement

 

SUPPLEMENT (this “Supplement”),
dated as of [●], 201[●], made by (the “Grantor”), in favor of SunTrust, Bank, as administrative
agent (in such capacity, the “Administrative Agent”) for the banks and other financial institutions or entities
(the “Lenders”) parties to the Credit Agreement referred to below. All capitalized terms not defined
herein shall have the meaning ascribed to them in such Credit Agreement.

 

WITNESSETH:

 

WHEREAS, American Eagle
Energy Corporation, a Nevada corporation (the “Borrower”), the Lenders and the Administrative Agent have entered
into a Credit Agreement, dated as of August 27, 2014 (as amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”);

 

WHEREAS, in connection
with the Credit Agreement, the Borrower and certain of its Affiliates (including the Grantor) have entered into the Guarantee and
Collateral Agreement, dated as of August 27, 2014 (as amended, supplemented or otherwise modified from time to time, the “Guarantee
and Collateral Agreement”) in favor of the Administrative Agent for the ratable benefit of the Secured Persons;

 

WHEREAS, the 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.          Guarantee
and Collateral Agreement. By executing and delivering this Assumption Agreement, the information set forth in Annex
1-A hereto is hereby added to the information set forth in the Schedule 2 and Schedule 3 to the Guarantee and
Collateral Agreement. The Grantor hereby represents and warrants that each of the representations and warranties contained
in Article 4 of the Guarantee and Collateral Agreement is true and correct in all material respects on and as the date hereof
(after giving effect to this Supplement) as if made on and as of such date, except to the extent that such representations and
warranties specifically refer to an earlier date, in which case they shall be true and correct in all material respects as of such
earlier date (except that any such representations and warranties that are qualified materially shall be true and correct in all
respects).

 

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 3 - 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 Persons 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 3 - 2

    	 

    

Annex 1-A to

Supplement

 

Supplement to Schedule 2

 

Supplement to Schedule 3

  

    	Annex 1-A

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