Document:

Exhibit 10.06

 

 

 

	 	Deed
	 	 
	 	27 May 2016
	 	 
	General security 

agreement	 
	 	 
	
        Discovery Energy SA Pty Ltd

         

        DEC Funding LLC
	 

 

	 	MLC Centre Martin Place Sydney NSW 2000 Australia

GPO Box 4227 Sydney NSW 2001 Australia	Telephone +61 2 9225 5000  Facsimile +61 2 9322 4000

www.herbertsmithfreehills.com  DX 361 Sydney

 

     

     

    

 

 

 

Contents

 

	 	Table of contents	 
	 	 	 	 
	1	Definitions, interpretation and deed components	2
	 	 	 	 
	 	1.1	Definitions	2
	 	1.2	Interpretation	6
	 	1.3	Interpretation of inclusive expressions	7
	 	1.4	Incorporated definitions from Principal Agreement	7
	 	1.5	PPSA incorporated definitions	8
	 	1.6	Deed components	8
	 	 	 	 
	2	Security	8
	 	 	 	 
	 	2.1	Security interest	8
	 	2.2	Priority	8
	 	2.3	Collection of proceeds of debts	8
	 	2.4	Controlled Account	9
	 	2.5	Proceeds	9
	 	2.6	Authorisation	10
	 	 	 	 
	3	Discharge of the Security	10
	 	 	 	 
	 	3.1	Discharge	10
	 	3.2	Final discharge	10
	 	 	 	 
	4	Representations and warranties, undertakings	10
	 	 	 	 
	 	4.1	Representations and warranties	10
	 	4.2	Survival of representations and warranties	12
	 	4.3	Reliance	12
	 	4.4	Performance under the Finance Documents	12
	 	4.5	Notices to the Secured Party	12
	 	4.6	Negative pledge and disposal of assets	13
	 	4.7	Permitted dealings	13
	 	4.8	Revolving Assets	13
	 	4.9	Conversion to Revolving Assets	13
	 	4.10	Inventory	13
	 	4.11	Further assurances	14
	 	4.12	Title Documents and Chattel Paper	14
	 	4.13	Perfection, registration and protection of Security	15
	 	4.14	No caveats	15
	 	4.15	Term of undertakings	15
	 	 	 	 
	5	Enforcement	16
	 	 	 	 
	 	5.1	When enforceable	16
	 	5.2	No dealing with assets	16
	 	5.3	Assistance in realisation	16
	 	5.4	Postponing or delaying realisation or enforcement	16
	 	 	 	 
	6	Receiver	17
	 	 	 	 
	 	6.1	Appointment of Receiver	17
	 	6.2	Agency of Receiver	17
	 	6.3	Powers of Receiver	17
	 	6.4	Nature of Receiver’s Powers	19
	 	6.5	Status of Receiver after commencement of winding-up	19

 

    		General security agreement     Contents 1

     

    

 

 

 

Contents

 

	 	6.6	Powers exercisable by the Secured Party	19
	 	6.7	Set-off	20
	 	6.8	Notice of exercise of rights	20
	 	6.9	Termination of receivership and possession	20
	 	 	 	 
	7	Application and receipts of money	20
	 	 	 	 
	 	7.1	Order of application	20
	 	7.2	Money actually received	21
	 	7.3	Amounts contingently due	21
	 	7.4	Notice of an Encumbrance	21
	 	7.5	Secured Party’s statement of indebtedness	22
	 	7.6	Secured Party’s receipts	22
	 	7.7	Conversion of currencies on application	22
	 	7.8	Amounts payable on demand	22
	 	 	 	 
	8	Power of attorney	22
	 	 	 	 
	 	8.1	Appointment of Attorney	22
	 	8.2	Purposes of appointment	23
	 	8.3	Exercise after Event of Default	23
	 	8.4	Delegation and substitution	23
	 	 	 	 
	9	Protection	23
	 	 	 	 
	 	9.1	Protection of third parties	23
	 	9.2	Protection of the Secured Party, Receiver and Attorney	24
	 	 	 	 
	10	Savings provisions	24
	 	 	 	 
	 	10.1	Statutory powers	24
	 	10.2	No notice required unless mandatory	24
	 	10.3	Appointment of nominee for PPSA registration	25
	 	10.4	Continuing security	25
	 	10.5	No merger of security	25
	 	10.6	Exclusion of moratorium	25
	 	10.7	Exclusion of PPSA provisions	25
	 	10.8	Conflict	26
	 	10.9	Consent of Secured Party	26
	 	10.10	Completion of blank securities	26
	 	10.11	Principal obligations	26
	 	10.12	No obligation to marshal	27
	 	10.13	Non avoidance	27
	 	10.14	Increase in financial accommodation	27
	 	 	 	 
	11	Third party provisions	27
	 	 	 	 
	 	11.1	Suspense account	27
	 	11.2	Independent obligations	28
	 	11.3	Unconditional nature of obligations	28
	 	11.4	No competition	30
	 	 	 	 
	12	General	31
	 	 	 	 
	 	12.1	Confidential information	31
	 	12.2	Performance by Secured Party of the Grantor’s obligations	31
	 	12.3	Grantor to bear cost	31
	 	12.4	Notices	31
	 	12.5	Governing law and jurisdiction	31

 

 

    		General security agreement     Contents 2

     

    

 

 

 

Contents

 

	 	12.6	Prohibition and enforceability	31
	 	12.7	Waivers	32
	 	12.8	Variation	32
	 	12.9	Cumulative rights	32
	 	12.10	Assignment	32
	 	12.11	Counterparts	32
	 	12.12	Attorneys	32

 

	 	Schedules	 
	 	 	 
	 	Schedule 1	 
	 	Notice details	34
	 	 	 
	 	Schedule 2	 
	 	Serial numbered goods or intangible property	35
	 	 	 
	 	Schedule 3	 
	 	Secured Property with a value greater than $25,000 located outside Australia	37
	 	 	 
	 	Schedule 4	 
	 	Disclosed Contracts	38
	 	 	 
	 	Schedule 5	 
	 	Secured Property in relation to which the Security may be perfected by control	39
	 	 	 
	 	Signing page	40

 

Herbert Smith Freehills owns the copyright in this
document and using it without permission is strictly prohibited.

 

    		General security agreement     Contents 3

     

    

 

 

 

General security agreement

 

 

Date ►
27 May 2016

 

Between the parties

 

 

	Grantor	
        Discovery Energy SA Pty Ltd

        ABN 89 158 204 052 of Level 8, 350 Collins Street,

Melbourne 3000

Australia 

	Secured Party	
        DEC Funding LLC

        Company number 802464276 (Texas) c/o Avista Capital Partners,
        1000 Louisiana Street, Suite 3700, Houston, Texas 77002

	Recitals	
        1     The
        Grantor is, or will be, the legal and beneficial owner of or otherwise has or will have sufficient right, interest or power to
        grant a security interest in the Secured Property.

         

        2     The
Grantor has agreed to create the Security to secure the payment of the Secured Moneys. 

	This deed witnesses 	that, for valuable consideration, the receipt and sufficiency of which is acknowledged, the parties agree as follows: 

 

    		General security agreement     page 1

     

    

 

 

 

		1	Definitions, interpretation and deed
                                         components

 

		1.1	Definitions

 

The meanings of the terms used in this deed are
set out below.

 

	Term	Meaning
	Attorney	an attorney appointed under this deed.
	Australian Guarantee	the document entitled ‘Deed of Guarantee and Indemnity’ between the Grantor and the Secured Party dated on or about the date of this deed.
	Australian Specific Security Agreement	the document entitled ‘Specific Security Deed (Shares)’ between the Principal Debtor and the Secured Party dated on or about the date of this deed.
	Collateral Security 	any present or future Encumbrance, Guarantee or other document or agreement created or entered into by a Transaction Party or any other person as security for, or to credit enhance, the payment of any of the Secured Moneys.
	Controlled Account	a bank account opened by the Grantor in accordance with clause 2.4. 
	Control Event	
        1    In
        respect of any Secured Property that is, or would have been, a Revolving Asset:

         

        ·    the
        Grantor breaches, or attempts to breach clause 4.6(a) in respect of the Secured Property or takes any step which would result in
        it doing so;

         

        ·    a
        person takes a step (including signing a notice or direction) which may result in Taxes or an amount owing to a Government Agency,
        ranking ahead of the Security; or

         

        ·    the
        Secured Party gives a notice to the Grantor that the Secured Property is not a Revolving Asset. (However, the Secured Party may
        only give a notice if the Secured Party reasonably considers that it is necessary to do so to protect its rights under this document
        or if an Event of Default is continuing); or

         

        2    In
        respect of all Secured Property that is or would have been Revolving Assets:

 

    		General security agreement     page 2

     

    

 

	 	1    Definitions, interpretation and deed components

 

	Term	Meaning
	 	
        ·    an
        administrator, liquidator or provisional liquidator is appointed in respect of the Grantor or the winding up of the Grantor begins;

         

        ·    a
        receiver, receiver and manager or Controller is appointed to any of the Grantor’s property; or

         

        ·    something
        having a substantially similar effect to the above 2 paragraphs or either of them happens under any law.

	Corporations Act 	the Corporations Act 2001 (Cth).
	debt	includes debts owing by a bank or other financial institution, including in relation to a current trading account.
	Designated Bank	the bank with which a Controlled Account is maintained.
	Disclosed Contract	a contract described in Schedule 4 or any other contract which the Secured Party and the Grantor agree is a Disclosed Contract for the purposes of this deed. 
	Event of Default 	an Event of Default as defined in the Principal Agreement and any other event of default (however described) under, or as defined in, any Finance Document.
	Finance Document 	
        1    this
        deed;

         

        2    each
        Collateral Security;

         

        3    the
        Principal Agreement;

         

        4    the
        Australian Guarantee;

         

        5    the
        Australian Specific Security Agreement;

         

        6    the
        US Security Agreement;

         

        7    the
        Securities Purchase Agreement;

         

        8    any
        other Finance Document as defined in the Principal Agreement;

         

        9    any
        document which the Grantor and the Secured Party agree, now or in the future, is a Finance Document for the purposes of this deed,

         

        or any document or agreement entered into
        or given under any of the above.

	Intellectual Property Rights 	all patents, trade marks, service marks, designs, copyrights, business names, trade secrets, know how and other intellectual property rights and interests (in each case whether registered under any statute or not).

 

    		General security agreement     page 3

     

    

 

	 	1    Definitions, interpretation and deed components

 

	Term	Meaning
	Marketable Securities	
        1    marketable
        securities as defined in section 9 of the Corporations Act; and

         

        2    any
        units (whatever called) in a trust estate which represent a legal or beneficial interest in any of the income or assets of that
        trust estate and includes any options to acquire any units as described.

	Permitted Encumbrance	the meaning given to the term “Permitted Lien” in the Debentures (as defined in the Securities Purchase Agreement).
	Petroleum Exploration Licence	as defined in the Principal Agreement.
	Power	any right, power, authority, discretion or remedy conferred on the Secured Party, a Receiver or an Attorney by any Finance Document or any applicable law.
	PPSA	the Personal Property Securities Act 2009 (Cth).
	PPSA Security Interest	a security interest as defined in the PPSA.
	Principal Agreement 	the terms of the Senior Secured Convertible Debenture issued by the Principal Debtor to the Secured Party dated 27 May 2016.
	Principal Debtor 	Discovery Energy Corporation 
	Priority Encumbrance	
        1    a
        mandatorily preferred by law; or

         

        2    approved
        by the Secured Party as a Priority Encumbrance for the purposes of this deed.

	Receiver	a receiver or receiver and manager appointed under this deed.
	Related Body Corporate	a “related body corporate” as defined in section 50 of the Corporations Act.

 

    		General security agreement     page 4

     

    

 

	 	1    Definitions, interpretation and deed components

 

	Term	Meaning
	Revolving Asset	
        any Secured Property:

         

        ·    which
        is;

         

        –    inventory;

         

        –    a
        negotiable instrument;

         

        –    machinery,
        plant, or equipment which is not inventory and has a value of less than A$1,000 or its equivalent;

         

        –    money
        (including money withdrawn or transferred to a third party from an account of the Grantor with a bank or other financial institution);
        and

         

        ·    in
        relation to which no Control Event has occurred, subject to clause 4.9.

	Secured Moneys 	
        all debts and monetary liabilities of the Grantor and the Principal
        Debtor to the Secured Party under or in relation to any Finance Document and in any capacity, irrespective of whether the debts
        or liabilities:

         

        1    are
        present or future;

         

        2    are
        actual, prospective, contingent or otherwise;

         

        3    are
        at any time ascertained or unascertained;

         

        4    are
        owed or incurred by or on account of the Grantor or the Principal Debtor alone, or severally or jointly with any other person;

         

        5    are
        owed to or incurred for the account of the Secured Party alone, or severally or jointly with any other person;

         

        6    are
        owed to any other person as agent (whether disclosed or not) for or on behalf of the Secured Party;

         

        7    are
        owed or incurred as principal, interest, fees, charges, Taxes, damages (whether for breach of contract or tort or incurred on any
        other ground), losses, costs or expenses, or on any other account;

         

        8    are
        owed to or incurred for the account of the Secured Party directly or as a result of:

         

        ·    the
        assignment or transfer to the Secured Party of any debt or liability of the Grantor or the Principal Debtor; or

         

        ·    any
        other dealing with any such debt or liability;

         

        9    are
        owed to or incurred for the account of the Secured Party before the date of this deed or before the date of any assignment of this
        deed to the Secured Party by any other person or otherwise; or

         

        10    comprise
        any combination of the above.

	Secured Property	all the Grantor’s present and after-acquired property. It includes anything in respect of which the Grantor has at any time sufficient right, interest or power to grant a security interest, excluding for all purposes, the Petroleum Exploration Licence, but including any proceeds thereof.

 

    		General security agreement     page 5

     

    

 

	 	1    Definitions, interpretation and deed components

 

	Term	Meaning
	Securities Purchase Agreement	the purchase agreement for the Senior Secured Convertible Debentures dated 27 May 2016 between the Principal Debtor and the Secured Party.
	Security	the security created or expressed to be created by this deed. 
	Title Document 	any original, duplicate or counterpart certificate or document of title including any real property certificate of title, a certificate of units in a unit trust, share certificate or certificate evidencing an Investment Instrument or Negotiable Instrument.
	Transaction Party	
        1     the
        Grantor; or

         

        2     the
        Principal Debtor.

	US Security Agreement	the security agreement for the Senior Secured Convertible Debentures dated 27 May 2016 between the Principal Debtor, all of the Principal Debtor’s subsidiaries and the Noteholder.

 

		1.2	Interpretation

 

In this deed:

 

		(a)	Headings and bold type are for convenience only and do not affect the interpretation of this deed.

 

		(b)	The singular includes the plural and the plural includes the singular.

 

		(c)	Words of any gender include all genders.

 

		(d)	Other parts of speech and grammatical forms of a word or phrase defined in this deed have a corresponding meaning.

 

		(e)	An expression importing a person includes any company, partnership, joint venture, association, corporation or other body corporate
and any Government Agency as well as an individual.

 

		(f)	A reference to any thing (including any right) includes a part of that thing but nothing in this clause 1.2(f) implies that
performance of part of an obligation constitutes performance of the obligation.

 

		(g)	A reference to a clause, party, schedule, attachment or exhibit is a reference to a clause of, and a party, schedule, attachment
or exhibit to, this deed.

 

		(h)	A reference to any legislation includes all delegated legislation made under it and amendments, consolidations, replacements
or re-enactments of any of them.

 

    		General security agreement     page 6

     

    

 

	 	1    Definitions, interpretation and deed components

 

		(i)	A reference to a document includes all amendments or supplements to, or replacements or novations of, that document.

 

		(j)	A reference to a party to a document includes that party’s successors and permitted assignees.

 

		(k)	A promise on the part of 2 or more persons binds them jointly and severally.

 

		(l)	A reference to an agreement other than this deed includes a deed and any legally enforceable undertaking, agreement, arrangement
or understanding, whether or not in writing.

 

		(m)	A reference to property or an asset includes any real or personal, present or future, tangible or intangible property, asset
or undertaking (including Intellectual Property Rights) and any right, benefit, interest or revenue in, under or derived from the
property or asset.

 

		(n)	A reference to liquidation or insolvency includes appointment of an administrator, compromise, arrangement, merger, amalgamation,
reconstruction, winding-up, dissolution, deregistration, assignment for the benefit of creditors, scheme, composition or arrangement
with creditors, insolvency, bankruptcy, or any similar procedure or, where applicable, changes in the constitution of any partnership
or person, or death.

 

		(o)	A reference to a document includes any agreement in writing, or any certificate, notice, deed, instrument or other document
of any kind.

 

		(p)	No provision of this deed will be construed adversely to a party because that party was responsible for the preparation of
this deed or that provision.

 

		(q)	A reference to a body, other than a party to this deed (including an institute, association or authority), whether statutory
or not:

 

		(1)	which ceases to exist; or

 

		(2)	whose powers or functions are transferred to another body,

 

is a reference to the body which replaces it or which
substantially succeeds to its powers or functions.

 

		(r)	References to time are to Melbourne time.

 

		(s)	Where this deed confers any power or authority on a person that power or authority may be exercised by that person acting personally
or through an agent or attorney.

 

		(t)	An Event of Default is ‘continuing’ or ‘subsisting’ if it has not been:

 

		(1)	remedied to the satisfaction of the Secured Party before a Power relating to that Event of Default is exercised; or

 

		(2)	waived in writing by the Secured Party.

 

		1.3	Interpretation of inclusive expressions

 

Specifying anything in this deed after the words
‘include’ or ‘for example’ or similar expressions does not limit what else is included unless there is
express wording to the contrary.

 

		1.4	Incorporated definitions from Principal Agreement

 

A word or phrase (other than one defined in clause
1.1) defined in the Principal Agreement has the same meaning in this deed.

 

    		General security agreement     page 7

     

    

 

	 	2    Security

 

		1.5	PPSA incorporated definitions

 

The following words and phrases defined in the PPSA
have the same meaning in this deed:

 

		(a)	Accession;

 

		(b)	Account;

 

		(c)	Chattel Paper;

 

		(d)	Commingled;

 

		(e)	Investment Instrument; and

 

		(f)	Negotiable Instrument.

 

		1.6	Deed components

 

This deed includes any schedule.

 

		2	Security

 

		2.1	Security interest

 

		(a)	The Grantor grants a security interest in the Secured Property to the Secured Party to secure payment of the Secured Moneys.

 

		(b)	This security interest is a transfer by way of security of Secured Property consisting of Accounts and Chattel Paper which
are not, or cease to be, Revolving Assets.

 

		(c)	To the extent any Secured Property is not transferred, this security interest is a charge. If for any reason it is necessary
to determine the nature of this charge, it is a floating charge over Revolving Assets and a fixed charge over all other Secured
Property.

 

		2.2	Priority

 

		(a)	The parties intend that the Security take priority over all other Encumbrances and other interests in the Secured Property
at any time other than any Priority Encumbrance.

 

		(b)	Nothing in this deed will be construed as an agreement by the Secured Party to subordinate the Security to any other Encumbrance
or interest affecting the Secured Property at any time.

 

		2.3	Collection of proceeds of debts

 

The Grantor may collect as agent for the Secured
Party for this purpose the proceeds of any debts or other amounts now or in the future payable to the Grantor subject to using
those proceeds as permitted under the Finance Documents.

 

    		General security agreement     page 8

     

    

 

	 	2    Security

 

		2.4	Controlled Account

 

		(a)	The Secured Party may require the Grantor to open and maintain a bank account at a bank and branch approved by the Secured
Party on terms that:

 

		(1)	nominated Officers of the Secured Party must be signatories to the Controlled Account;

 

		(2)	no withdrawals can be made from the Controlled Account without the signature of one of those Officers;

 

		(3)	funds may be disposed of from the Controlled Account at the direction of the Secured Party without further consent by the Grantor;
and

 

		(4)	depositing an amount in the Controlled Account will not result in any person coming under a present liability (within the meaning
of section 341(3)(d) of the PPSA) to pay:

 

		·	the Grantor; or

 

		·	a Related Body Corporate of the Grantor.

 

		(b)	If the Secured Party is not the Designated Bank, the Grantor must cause the Designated Bank to enter into an agreement between
the Designated Bank, the Grantor and the Secured Party in form and substance satisfactory to the Secured Party in which the Designated
Bank agrees that:

 

		(1)	it will comply with and give effect to the terms set out in clause 2.4(a);

 

		(2)	it has no Encumbrance or other interest in the Controlled Account and it waives all rights of set-off and combination in respect
of the Controlled Account;

 

		(3)	if despite clause 2.4(b)(2) it has any Encumbrance or other interest in the Controlled Account, that Encumbrance or other interest
is subordinated in right and priority of payment to the Secured Party's Encumbrance or other interest and will not be exercised
without the Secured Party’s consent; and

 

		(4)	it agrees that the laws specified in clause 12.5(b) will govern the Secured Party’s PPSA Security Interest in the Controlled
Account.

 

		2.5	Proceeds

 

		(a)	If a Control Event occurs in respect of any proceeds or in respect of any Secured Property the Grantor must immediately and
until notified otherwise by the Secured Party deposit in the Controlled Account any proceeds the Grantor receives in respect of
any book debt, insurance policy in relation to the Secured Property or any other debts or other amounts now or in the future payable
to the Grantor which are Secured Property.

 

		(b)	Clause 2.5(a) does not apply to proceeds received from any workers’ compensation or public liability policy or reinstatement
policy to the extent that the proceeds are paid to a person:

 

		(1)	entitled to be compensated under the workers’ compensation or public liability policy; or

 

		(2)	under a contract for the reinstatement of the Secured Property.

 

		(c)	The Grantor must give all notices and directions and execute all necessary documents as requested by the Secured Party to ensure
clause 2.5(a) is complied with.

 

    		General security agreement     page 9

     

    

 

	 	3    Discharge of the Security

 

		(d)	A Power created under this clause 2.5 is not waived by any failure or delay in exercise, or by the partial exercise, of that
Power.

 

		2.6	Authorisation

 

		(a)	The Grantor must ensure that it obtains all Authorisations (other than an Authorisation that would be required under a Disclosed
Contract) necessary to permit the grant of the Security in respect of any asset before it acquires any rights in that asset.

 

		(b)	Without limiting clauses 2.6(a) and 12.6, if the grant of the Security in respect of an asset would:

 

		(1)	invalidate, avoid or render ineffective any Security, whether in respect of that asset only or otherwise; or

 

		(2)	breach any Disclosed Contract relating to that asset,

 

then that asset is excluded from the Security, but
only for so long as that effect prevails.

 

		(c)	If the Security could be granted in respect of an asset referred to in clause 2.6(b) without clause 2.6(b) applying if
an Authorisation was obtained or other action taken, the Grantor must promptly obtain that Authorisation (other than an
Authorisation under a Disclosed Contract) or take that action).

 

		3	Discharge of the Security

 

		3.1	Discharge

 

Subject to clause 3.2, at the written request of
the Grantor, the Secured Party must discharge the Security and retransfer to the Grantor its right and interest in all Accounts
and Chattel Paper transferred under clause 2.1(b) (or clause 4.8(c)) if:

 

		(a)	the Secured Moneys have been paid in full; and

 

		(b)	the Grantor and each other Transaction Party has fully observed and performed its respective obligations under this deed and
each other Finance Document.

 

		3.2	Final discharge

 

		(a)	The Secured Party is not obliged to discharge the Security under clause 3.1 if, at the time the requirements of clause
3.1 are satisfied, the Secured Party (acting reasonably) is of the opinion that the Grantor or any other Transaction Party owes
further Secured Moneys contingently or otherwise to the Secured Party.

 

		(b)	Clause 3.2(a) overrides any other clause to the contrary in this deed.

 

		4	Representations and warranties, undertakings

 

		4.1	Representations and warranties

 

The Grantor represents and warrants that:

 

    		General security agreement     page 10

     

    

 

	 	4    Representations and warranties, undertakings

 

		(a)	representations true: each of its representations and warranties contained in the Finance Documents is correct and not
misleading when made or repeated;

 

		(b)	legal and beneficial owner: it is the legal and beneficial owner of or otherwise has sufficient right, interest or power
to grant a security interest in the Secured Property;

 

		(c)	no other interests:

 

		(1)	no person other than the Secured Party holds or has the benefit of an Encumbrance or other interest in the Secured Property
other than under a Disclosed Contract;

 

		(2)	there is no agreement, filing or registration that would enable another person to obtain a priority over the Security which
is inconsistent with the priority contemplated by this deed;

 

		(d)	Security:

 

		(1)	this deed creates the Encumbrance purported to be created by it over the assets purported to be encumbered by it; and

 

		(2)	all information supplied by the Grantor in connection with a registration is accurate and up to date and that the Grantor has
taken all steps required by the Secured Party under clause 4.13; and

 

		(3)	the Security has the priority contemplated by this deed;

 

		(e)	serial numbers: Schedule 2 shows accurate serial numbers for each item of Secured Property (if any) other than property
the Grantor acquired for disposal in the ordinary course of the Grantor’s ordinary business, if any which the PPSA Regulations
require to be described by serial number in a registration under the PPSA;

 

		(f)	location of assets: Schedule 3 shows all Secured Property with a value greater than $25,000 located outside Australia
(if any);

 

		(g)	Authorisations: it has obtained all Authorisations (other than an Authorisation that would be required under a Disclosed
Contract) necessary to permit the grant of the Security in respect of any asset in which it presently has rights; and

 

perfection by control:

 

    		General security agreement     page 11

     

    

 

	 	4    Representations and warranties, undertakings

 

		(h)	Schedule 5 shows all Secured Property in relation to which the Security may be perfected by control other than Marketable Securities
issued by a Transaction Party.

 

		4.2	Survival of representations and warranties

 

The representations and warranties given under this
deed survive the execution of this deed.

 

		4.3	Reliance

 

		(a)	The Grantor acknowledges that it has not entered into this deed or any Finance Document in reliance on any representation,
warranty, promise or statement made by the Secured Party or any person on behalf of the Secured Party.

 

		(b)	The Grantor acknowledges that the Secured Party has entered into each Finance Document in reliance on the representations and
warranties given by the Grantor under this deed.

 

		4.4	Performance under the Finance Documents

 

		(a)	The Grantor must fully and punctually perform its obligations under each Finance Document.

 

		(b)	Without limiting the generality of clause 4.4(a), the Grantor must pay the Secured Moneys to the Secured Party in accordance
with this deed, each other Finance Document and each other obligation under which the Secured Moneys are payable.

 

		(c)	The Grantor must ensure that no Event of Default occurs. Without affecting the liability of the Grantor or the Powers in any
other respect (including where a breach of this clause 4.4(c) is also a breach of another provision of a Finance Document), the
Grantor is not liable in damages for breach of this clause 4.4(c) but the Secured Party may exercise its Powers consequent upon
or following that breach.

 

		4.5	Notices to the Secured Party

 

In addition to its obligations in any other Finance
Document, the Grantor must notify the Secured Party as soon as the Grantor becomes aware of any of the following:

 

		(a)	the acquisition by it of, or the entry by it into, an agreement to acquire:

 

		(1)	any interest in real property;

 

		(2)	any Marketable Securities or other property in relation to which the Security may be perfected by control;

 

		(3)	any motor vehicles or other property with a value greater than $25,000 which the PPS Regulations provide may or must be described
by serial number in a registration under the PPSA;

 

		(4)	any property with a value greater than $25,000 which is situated outside Australia;

 

		(b)	any change of the jurisdiction in which any of the Secured Property with a value greater than $25,000 is situated; and

 

		(c)	any data contained in a registration under the PPSA with respect to the Security being or becoming incorrect.

 

    		General security agreement     page 12

     

    

 

	 	4    Representations and warranties, undertakings

 

		4.6	Negative pledge and disposal of assets

 

		(a)	The Grantor must not do, or agree to do, any of the following unless it is permitted to do so by clause 4.7 or another provision
in a Finance Document:

 

		(1)	create or allow another interest in any Secured Property which is not a Permitted Encumbrance; or

 

		(2)	dispose, or part with possession, of any Secured Property; or

 

		(3)	enter into any agreement which causes further debt to accrue which is not a Permitted Indebtedness.

 

		(b)	The Grantor must not permit any of the Secured Property to become:

 

		(1)	Commingled with any asset that is not Secured Property except in the ordinary course of the Grantor’s ordinary business;
or

 

		(2)	an Accession to or to be affixed to any asset that is not Secured Property.

 

		4.7	Permitted dealings

 

The Grantor may do any of the following in the ordinary
course of the Grantor’s ordinary business unless it is prohibited from doing so by another provision in a Finance Document:

 

		(a)	create or allow another interest in, or dispose or part with possession of, any Secured Property which is a Revolving Asset;
or

 

		(b)	withdraw or transfer money from an account with a bank or other financial institution.

 

		4.8	Revolving Assets

 

If a Control Event occurs in respect of any Secured
Property then automatically:

 

		(a)	that Secured Property is not (and immediately ceases to be) a Revolving Asset;

 

		(b)	any floating charge over that Secured Property immediately operates as a fixed charge;

 

		(c)	if the Secured Property is Accounts or Chattel Paper it is transferred to the Secured Party by way of security; and

 

		(d)	the Grantor may no longer deal with the Secured Property under clause 4.7.

 

		4.9	Conversion to Revolving Assets

 

If any Secured Property is not or ceases to be a
Revolving Asset, and becomes subject to a fixed charge or transfer under clause 4.8, the Secured Party may give the Grantor a notice
stating that, from a date specified in the notice, the Secured Property specified in the notice is a Revolving Asset, or becomes
subject to a floating charge or is transferred back to the Grantor. This may occur any number of times.

 

		4.10	Inventory

 

Any inventory which is not, or ceases to be, a Revolving
Asset is specifically appropriated to a security interest under this document. The Grantor may not remove it without obtaining
the specific and express authority of the Secured Party to do so.

 

    		General security agreement     page 13

     

    

 

	 	4    Representations and warranties, undertakings

 

		4.11	Further assurances

 

The Grantor must:

 

		(a)	do anything which the Secured Party reasonably requests to:

 

		(1)	ensure, or enable the Secured Party to ensure, that this deed, the Security and the Powers are fully effective, enforceable
and perfected with the contemplated priority;

 

		(2)	more satisfactorily assure or secure to the Secured Party the Secured Property in a manner consistent with the Finance Documents;
or

 

		(3)	aid the exercise of any Power,

 

including executing any document, delivering Title
Documents or Chattel Paper, executing and delivering blank transfers or giving notice of the Security to any third party;

 

		(b)	without limiting clause 4.11(a), when the Secured Party requests, execute:

 

		(1)	a legal or statutory mortgage in favour of the Secured Party over any real property; or

 

		(2)	any other form of security which the Secured Party considers appropriate for the property to be subject to that security,

 

each in form and substance required by the Secured
Party and

 

		(c)	without limiting clause 4.11(a), cause a third party to provide any Authorisation (other than an Authorisation that would be
required under a Disclosed Contract) or take any other action (including executing any document) required to give effect to clause
4.11(a).

 

		4.12	Title Documents and Chattel Paper

 

		(a)	The Grantor must deposit with the Secured Party, or as the Secured Party directs, all the Title Documents in respect of any
of the Secured Property together with executed blank transfers in respect of the Secured Property to which the Title Documents
relate and all Chattel Paper forming part of the Secured Property with a value greater than $25,000 immediately on:

 

		(1)	its execution of this deed; and

 

		(2)	acquisition of any asset which forms part of the Secured Property.

 

		(b)	At any time after an Event of Default occurs, if required by the Secured Party, the Grantor must deposit with the Secured Party
all Chattel Paper which forms part of the Secured Property regardless of value and which has not already been deposited under clause
4.12(a).

 

		(c)	Subject to clause 4.12(d), the Secured Party may retain the Title Documents and Chattel Paper deposited with the Secured Party
until the Security in respect of all the Secured Property is discharged under clause 3.

 

		(d)	If the Security is enforced by the Secured Party, the Secured Party, Receiver or Attorney is entitled:

 

		(1)	to deal with the Title Documents and the Chattel Paper as if it was the absolute and unencumbered owner of the Secured Property
to which the Title Documents relate and of the Chattel Paper; and

 

    		General security agreement     page 14

     

    

 

	 	4    Representations and warranties, undertakings

 

		(2)	in exercising a power of sale, to deliver any Title Document or Chattel Paper to a purchaser of the Secured Property to which
the Title Document relates or of the Chattel Paper.

 

		4.13	Perfection, registration and protection of Security

 

		(a)	4.13(a)(b)(c)4.13(a)4.1(d)(2)4.13The Grantor must take all steps reasonably required by the Secured Party to ensure that:

 

		(1)	the Security is perfected in relation to all the Secured Property in all jurisdictions; and

 

		(2)	this deed and the Security are registered and filed in all registers in all jurisdictions

 

in which it must be perfected, registered and filed,
to ensure its enforceability, validity, perfection and priority against all persons and to be effective as a security.

 

		(b)	Whenever the Secured Party requires that the Security be perfected in a particular way in relation to any part of the Secured
Property, the Grantor must ensure that the Security is perfected in that way.

 

		(c)	The Grantor will not be in breach of its obligation under this clause 4.13 and its representation and warranty under clause
4.1(d)(2) will not be incorrect or misleading if the Secured Party fails to take any action which can only be taken by the Secured
Party to enable the Security to be perfected as required under this clause 4.13, after written request from the Grantor to take
that action.

 

		(d)	Whenever any part of the Secured Property is transferred to or retained in a place where this deed or the Security, because
of an increase in the Secured Moneys or otherwise, bears insufficient stamp duty or is not registered or recorded, or for any other
reason is of limited or of no force or effect, unenforceable, inadmissible in evidence or of reduced priority, the Grantor must
within 14 days after that transfer or retention ensure that:

 

		(1)	this deed is stamped to the satisfaction of the Secured Party;

 

		(2)	this deed is in full force and effect, enforceable, perfected, admissible in evidence and not of reduced priority; and

 

		(3)	this deed and the Security are registered in that place, or that part of the Secured Property is removed from that place.

 

		4.14	No caveats

 

The Grantor must ensure that any caveat lodged in
respect of the Secured Property, other than a caveat lodged by the Secured Party, is removed as soon as reasonably practicable
but in any event within 5 days after the date that it becomes aware of its existence.

 

		4.15	Term of undertakings

 

Each of the Grantor’s undertakings in this
clause 4 continue in full force and effect from the date of this deed until the Security in respect of all the Secured Property
is discharged under clause 3.

 

    		General security agreement     page 15

     

    

 

	 	5    Enforcement

 

		5	Enforcement

 

		5.1	When enforceable

 

		(a)	If an Event of Default occurs:

 

		(1)	the Security and each Collateral Security are immediately enforceable without the need for any demand or notice to be given
to the Grantor or any other person; and

 

		(2)	the Secured Moneys are immediately due and payable by the Grantor without the need for any demand or notice to be given to
the Grantor or any other person other than a notice expressly required by a Finance Document.

 

		(b)	The Secured Party agrees that it will not exercise any Power to enforce the Security under Chapter 4 of the PPSA until an Event
of Default occurs.

 

		5.2	No dealing with assets

 

Any right of the Grantor to deal, for any purpose,
with any asset which forms part of the Secured Property (including under clause 2.3), other than by or through a Receiver appointed
under this deed, immediately ceases if:

 

		(a)	the Secured Party declares that the Secured Moneys are immediately due and payable; or

 

		(b)	the Secured Party takes any step to enforce the Security; or

 

		(c)	subject to clause 4.9 a Control Event occurs in relation to the asset.

 

		5.3	Assistance in realisation

 

After the Security has become enforceable, the Grantor
must take all action required by the Secured Party, Receiver or Attorney to assist any of them to realise the Secured Property
and exercise any Power including:

 

		(a)	executing all transfers, conveyances, assignments and assurances of any of the Secured Property;

 

		(b)	doing anything necessary or desirable under the law in force in any place where the Secured Property is situated;

 

		(c)	giving all notices, orders, directions and consents which the Secured Party, Receiver or Attorney thinks expedient; and

 

		(d)	doing anything necessary:

 

		(1)	for a call to be made on the uncalled capital of the Grantor; or

 

		(2)	to collect all called but unpaid capital of the Grantor.

 

		5.4	Postponing or delaying realisation or enforcement

 

The Secured Party, a Receiver or Attorney may postpone
or delay the exercise of any Power for such period as the Secured Party, Receiver or Attorney may in its absolute discretion decide.

 

    		General security agreement     page 16

     

    

 

	 	6    Receiver

 

		6	Receiver

 

		6.1	Appointment of Receiver

 

If an Event of Default occurs, the Secured Party
may at any time after its occurrence:

 

		(a)	appoint any person or any 2 or more persons jointly, or severally, or jointly and severally to be a receiver or a receiver
and manager of the Secured Property;

 

		(b)	remove any Receiver and on the removal, retirement or death of any Receiver, appoint another Receiver; and

 

		(c)	fix the remuneration and direct payment of that remuneration and any costs, charges and expenses of the Receiver out of the
proceeds of any realisation of the Secured Property.

 

		6.2	Agency of Receiver

 

		(a)	Subject to clause 6.5, each Receiver is the agent of the Grantor.

 

		(b)	The Grantor is responsible for the acts, defaults and remuneration of the Receiver.

 

		6.3	Powers of Receiver

 

Subject to any express exclusion by the terms of
the Receiver’s appointment, the Receiver has, in addition to any powers conferred on the Receiver by applicable law, and
whether or not in possession of the Secured Property, or any part of it, the following powers:

 

		(a)	manage, possession or control: to manage, enter into possession or assume control of any of the Secured Property;

 

		(b)	lease or licence: to accept the surrender of, determine, grant or renew any lease or licence in respect of the use or
occupation of any of the Secured Property:

 

		(1)	on any terms or special conditions that the Secured Party or Receiver thinks fit; and

 

		(2)	in conjunction with the sale, lease or licence of any other property by any person;

 

		(c)	sale: to sell or concur in selling any of the Secured Property to any person:

 

		(1)	by auction, private treaty or tender;

 

		(2)	on such terms and special conditions as the Secured Party or the Receiver thinks fit;

 

		(3)	for cash or for a deferred payment of the purchase price, in whole or in part, with or without interest or security;

 

		(4)	in conjunction with the sale of any property by any other person; and

 

		(5)	in one lot or in separate parcels;

 

		(d)	grant options to purchase: to grant to any person an option to purchase any of the Secured Property;

 

		(e)	acquire property: to acquire any interest in any property, in the name or on behalf of the Grantor, which on acquisition
forms part of the Secured Property;

 

    		General security agreement     page 17

     

    

 

	 	6    Receiver

 

		(f)	carry on business: to carry on or concur in carrying on any business of the Grantor in respect of the Secured Property;

 

		(g)	borrowings and security:

 

		(1)	to raise or borrow any money, in its name or the name or on behalf of the Grantor, from the Secured Party or any person approved
by the Secured Party in writing; and

 

		(2)	to secure money raised or borrowed under clause 6.3(g)(1) by an Encumbrance over any of the Secured Property, ranking in priority
to, equal with, or after, the Security or any Collateral Security;

 

		(h)	maintain or improve Secured Property: to do anything to maintain, protect or improve any of the Secured Property including
completing, repairing, erecting a new improvement on, demolishing or altering any of the Secured Property;

 

		(i)	income and bank accounts: to do anything to manage or obtain income or revenue from any of the Secured Property including
operating any bank account which forms part of the Secured Property or opening and operating a new bank account;

 

		(j)	access to Secured Property: to have access to any of the Secured Property, the premises at which the business of the
Grantor is conducted and any of the administrative services of the business of the Grantor;

 

		(k)	insure Secured Property: to insure any of the Secured Property;

 

		(l)	sever fixtures: to sever fixtures in respect of any of the Secured Property;

 

		(m)	compromise: to make or accept any compromise or arrangement;

 

		(n)	surrender Secured Property: to surrender or transfer any of the Secured Property to any person;

 

		(o)	exchange Secured Property: to exchange with any person any of the Secured Property for any other property whether of
equal value or not;

 

		(p)	employ or discharge: to employ or discharge any person as an employee, contractor, agent, professional advisor or auctioneer
for any of the purposes of this deed;

 

		(q)	delegate: to delegate to any person any Power of the Receiver;

 

		(r)	perform or enforce documents: to observe, perform, enforce, exercise or refrain from exercising any right, power, authority,
discretion or remedy of the Grantor under, or otherwise obtain the benefit of:

 

		(1)	any document, agreement or right which attaches to or forms part of the Secured Property; and

 

		(2)	any document or agreement entered into in exercise of any Power by the Receiver;

 

		(s)	receipts: to give effectual receipts for all moneys and other assets which may come into the hands of the Receiver;

 

		(t)	take proceedings: to commence, discontinue, prosecute, defend, settle or compromise in its name or the name or on behalf
of the Grantor, any proceedings including proceedings in relation to any insurance in respect of any of the Secured Property;

 

		(u)	insolvency proceedings: to make any debtor bankrupt, wind-up any company, corporation or other entity and do all things
in relation to any bankruptcy or winding-up which the Receiver thinks necessary or desirable including attending and voting at
creditors’ meetings and appointing proxies for those meetings;

 

    		General security agreement     page 18

     

    

 

	 	6    Receiver

 

		(v)	execute documents: to enter into and execute any document or agreement in the name of the Receiver or the name or on
behalf of the Grantor including bills of exchange, cheques or promissory notes for any of the purposes of this deed;

 

		(w)	make calls: to make calls on any member of the Grantor in respect of uncalled capital of the Grantor;

 

		(x)	vote: to exercise any voting rights or powers in respect of any part of the Secured Property;

 

		(y)	collect called capital: to collect or enforce payment of any called but unpaid capital of the Grantor whether or not
the calls were made by the Receiver;

 

		(z)	ability of Grantor: to do anything the Grantor could do in relation to the Secured Property; and

 

		(aa)	incidental power: to do anything necessary or incidental to the exercise of any Power of the Receiver.

 

		6.4	Nature of Receiver’s Powers

 

The Powers of the Receiver must be construed independently
and no one Power limits the generality of any other Power. Any dealing under any Power of the Receiver will be on the terms and
conditions the Receiver thinks fit.

 

		6.5	Status of Receiver after commencement of winding-up

 

		(a)	The power to appoint a Receiver under clause 6.1 may be exercised even if, at the time an Event of Default occurs or if at
the time a Receiver is appointed, an order has been made or a resolution has been passed for the winding-up of the Grantor.

 

		(b)	If for any reason, including operation of law, a Receiver:

 

		(1)	appointed in the circumstances described in clause 6.5(a); or

 

		(2)	appointed at any other time,

 

ceases to be the agent of the Grantor as a result
of an order being made or a resolution being passed for the winding-up of the Grantor, then the Receiver immediately becomes the
agent of the Secured Party.

 

		6.6	Powers exercisable by the Secured Party

 

		(a)	Whether or not a Receiver is appointed under clause 6.1, the Secured Party may, on or after the occurrence of an Event of Default
and without giving notice to any person, exercise any Power that could be conferred on a Receiver in addition to any Power of the
Secured Party.

 

		(b)	The exercise of any Power by the Secured Party, Receiver or Attorney does not cause or deem the Secured Party, Receiver or
Attorney:

 

		(1)	to be a mortgagee in possession;

 

		(2)	to account as mortgagee in possession; or

 

		(3)	to be answerable for any act or omission for which a mortgagee in possession is liable.

 

    		General security agreement     page 19

     

    

 

	 	7    Application and receipts of money

 

		6.7	Set-off

 

If any Event of Default is subsisting, the Secured
Party may apply any credit balance in any currency in any of the Grantor’s accounts with the Secured Party in and towards
satisfaction of any of the Secured Moneys.

 

		6.8	Notice of exercise of rights

 

The Secured Party, Receiver or Attorney is not required:

 

		(a)	to give notice of the Security or any Collateral Security to any debtor or creditor of the Grantor or to any other person;

 

		(b)	to enforce payment of any money payable to the Grantor including any of the debts or monetary liabilities secured by this deed
or by any Collateral Security; or

 

		(c)	to obtain the consent of the Grantor to any exercise of a Power.

 

		6.9	Termination of receivership and possession

 

The Secured Party may, at any time, terminate the
appointment of a Receiver and may, at any time, give up, or re-take, possession of the Secured Property.

 

		7	Application and receipts of money

 

		7.1	Order of application

 

		(a)	At any time after the Security is enforceable, all money received by the Secured Party, Receiver, Attorney or any other person
acting on their behalf under this deed or any Collateral Security may be appropriated and applied towards any amount and in any
order that the Secured Party, Receiver, Attorney or that other person determines in its absolute discretion, to the extent not
prohibited by law.

 

		(b)	Failing a determination under clause 7.1(a), the money must be applied in the following manner and order:

 

		(1)	first, in payment of all costs, charges and expenses (including any GST) of the Secured Party, Receiver or Attorney incurred
in or incidental to the exercise or performance or attempted exercise or performance of any Power;

 

		(2)	second, in payment of any other outgoings the Secured Party, Receiver or Attorney thinks fit to pay;

 

		(3)	third, in payment to the Receiver of his remuneration;

 

		(4)	fourth, in payment and discharge, in order of their priority, of any Encumbrances of which the Secured Party, Receiver or Attorney
is aware and which have priority to the Security;

 

		(5)	fifth, in payment to the Secured Party towards satisfaction of the Secured Moneys and applied against interest, principal or
any other amount the Secured Party, Receiver or Attorney thinks fit;

 

		(6)	sixth, in payment only to the extent required by law, in order of their priority, of other Encumbrances in respect of the Secured
Property of which the Secured Party, Receiver or Attorney is aware and which are due and payable in accordance with their terms;
and

 

    		General security agreement     page 20

     

    

 

	 	7    Application and receipts of money

 

		(7)	seventh, in payment of the surplus, if any, without interest to the Grantor. The Secured Party, Receiver or Attorney may pay
the surplus to the credit of an account in the name of the Grantor in the books of any bank carrying on business within Australia
and having done so is under no further liability in respect of that surplus.

 

		(c)	Any amount required by law to be paid in priority to any amount specified in clause 7.1(b) must be paid before any money is
applied in payment of the amount specified in clause 7.1(b).

 

		7.2	Money actually received

 

In applying any money towards satisfaction of the
Secured Moneys, the Grantor is to be credited only with so much of the money which is available for that purpose (after deducting
any GST imposed) and which is actually received by the Secured Party, Receiver or Attorney. The credit dates from the time of receipt.

 

		7.3	Amounts contingently due

 

		(a)	If at the time of a distribution of any money under clause 7.1 any part of the Secured Moneys is contingently owing to the
Secured Party, the Secured Party, Receiver or Attorney may retain an amount equal to the amount contingently owing or any part
of it.

 

		(b)	If the Secured Party, Receiver or Attorney retains any amount under clause 7.3(a) it must place that amount on short-term interest
bearing deposit until the amount contingently owing becomes actually due and payable or otherwise ceases to be contingently owing
at which time the Secured Party, Receiver or Attorney must:

 

		(1)	pay to the Secured Party the amount which has become actually due to it; and

 

		(2)	apply the balance of the amount retained, together with any interest on the amount contingently owing, in accordance with clause
7.1.

 

		7.4	Notice of an Encumbrance

 

		(a)	If the Secured Party receives actual or constructive notice of an Encumbrance over the Secured Property or of the perfection
of an Encumbrance, the Secured Party:

 

		(1)	may open a new account in the name of the Grantor in its books; or

 

		(2)	is regarded as having opened a new account in the name of the Grantor in its books,

 

on the date it received or was regarded as having
received notice of the Encumbrance or perfection.

 

		(b)	From the date on which that new account is opened or regarded as opened:

 

		(1)	all payments made by the Grantor to the Secured Party; and

 

		(2)	all financial accommodation and advances by the Secured Party to the Grantor, are or are regarded as credited and debited,
as the case may be, to the new account unless otherwise specified by the Secured Party.

    		General security agreement     page 21

     

    

 

	 	8    Power of attorney

 

		(c)	The payments by the Grantor under clause 7.4(b) must be applied in the manner determined by the Secured Party or, failing a
determination:

 

		(1)	first, in reduction of the debit balance, if any, in the new account; and

 

		(2)	second, if there is no debit balance in the new account, in reduction of the Secured Moneys which have not been debited or
regarded as debited to the new account.

 

		7.5	Secured Party’s statement of indebtedness

 

A certificate signed by any Officer of the Secured
Party stating:

 

		(a)	the amount of the Secured Moneys due and payable; or

 

		(b)	the amount of the Secured Moneys, whether currently due and payable or not,

 

is sufficient evidence of that amount as at the date
stated on the certificate, or failing that as at the date of the certificate, unless the contrary is proved.

 

		7.6	Secured Party’s receipts

 

		(a)	The receipt of any Officer of the Secured Party for any money payable to or received by the Secured Party under this deed exonerates
the payer from all liability to enquire whether any of the Secured Moneys have become payable.

 

		(b)	Every receipt of an Officer of the Secured Party effectually discharges the payer from:

 

		(1)	any future liability to pay the amount specified in the receipt; and

 

		(2)	being concerned to see to the application of, or being answerable or accountable for any loss or misapplication of, the amount
specified in the receipt.

 

		7.7	Conversion of currencies on application

 

In making an application under clause 7.1, the Secured
Party, Receiver or Attorney may itself, or through its bankers, purchase one currency with another, whether or not through an intermediate
currency, whether spot or forward, in the manner and amounts and at the time it thinks fit.

 

		7.8	Amounts payable on demand

 

If an amount payable under a Finance Document is
not expressed to be payable on a specified date, that amount is payable by the Grantor on demand by the Secured Party.

 

		8	Power of attorney

 

		8.1	Appointment of Attorney

 

For consideration received, the Grantor irrevocably
appoints the Secured Party and each Receiver severally its attorney for the purposes set out in clause 8.2.

 

    		General security agreement     page 22

     

    

 

	 	9    Protection

 

		8.2	Purposes of appointment

 

The Attorney may, in its name or in the name of
the Grantor, Secured Party or Receiver, do any of the following:

 

		(a)	do any thing which ought to be done by the Grantor under this deed or any other Finance Document;

 

		(b)	exercise any right, power, authority, discretion or remedy of the Grantor under:

 

		(1)	this deed;

 

		(2)	any other Finance Document; or

 

		(3)	any agreement forming part of the Secured Property;

 

		(c)	do any thing which in the opinion of the Secured Party, Receiver or Attorney is necessary or desirable for securing or perfecting
the Security and any Collateral Security;

 

		(d)	execute in favour of the Secured Party any legal mortgage, transfer, assignment and any other assurance of any of the Secured
Property;

 

		(e)	execute deeds of assignment, composition or release;

 

		(f)	sell or otherwise part with the possession of any of the Secured Property; and

 

		(g)	generally, do any other thing, whether or not of the same kind as those set out in clause 8.2(a) to (f), which in the opinion
of the Secured Party, Receiver or Attorney is necessary or desirable:

 

		(1)	to more satisfactorily secure to the Secured Party the payment of the Secured Moneys; or

 

		(2)	in relation to any of the Secured Property.

 

		8.3	Exercise after Event of Default

 

An Attorney must not exercise any Power under clause
8.2 until an Event of Default occurs but a breach of this clause 8.3 does not affect the validity of the Attorney’s act.

 

		8.4	Delegation and substitution

 

The Attorney may appoint a substitute attorney to
perform any of its Powers.

 

		9	Protection

 

		9.1	Protection of third parties

 

		(a)	No person dealing with the Secured Party, Receiver or Attorney is bound to enquire whether:

 

		(1)	the Security has become enforceable;

 

		(2)	the Receiver or Attorney is duly appointed; or

 

		(3)	any Power has been properly or regularly exercised.

 

		(b)	No person dealing with the Secured Party, Receiver or Attorney is affected by express notice that the exercise of any Power
was unnecessary or improper.

 

    		General security agreement     page 23

     

    

 

	 	10    Savings provisions

 

		(c)	The irregular or improper exercise of any Power is, as regards the protection of any person, regarded as authorised by the
Grantor and this deed, and is valid.

 

		9.2	Protection of the Secured Party, Receiver and Attorney

 

		(a)	The Secured Party, Receiver or Attorney is not liable for any loss or damage including consequential loss or damage, arising
directly or indirectly from:

 

		(1)	any omission or delay in the exercise or non-exercise of any Power; or

 

		(2)	the neglect, default or dishonesty of any manager, Officer, employee, agent, accountant, auctioneer or solicitor of the Grantor,
the Secured Party, Receiver or Attorney.

 

		(b)	Clause 9.2(a) does not apply:

 

		(1)	in respect of the Secured Party, to any loss or damage which arises from the wilful default, fraud or gross negligence of the
Secured Party; and

 

		(2)	in respect of a Receiver or Attorney, to any loss or damage which arises from the wilful default, fraud or gross negligence
of the Receiver or Attorney.

 

		10	Savings provisions

 

		10.1	Statutory powers

 

		(a)	Subject to clause 10.1(b), the powers of the Secured Party under this deed or any Collateral Security are in addition to any
powers the Secured Party has under applicable law.

 

		(b)	If the Secured Party exercises a Power in connection with this deed, that exercise is taken not to be an exercise of a Power
under the PPSA unless the Secured Party states otherwise at the time of exercise. However, this clause 10.1(b) does not apply to
a right, power or remedy which can only be exercised under the PPSA.

 

		10.2	No notice required unless mandatory

 

To the extent the law permits, the Grantor waives:

 

		(a)	its rights to receive any notice that is required by:

 

		(1)	any provision of the PPSA (including a notice of a verification statement); or

 

		(2)	any other law, before a secured party or Receiver exercises a right, power or remedy; and

 

		(b)	any time period that must otherwise lapse under any law before a secured party or receiver exercises a right, power or remedy.

 

If the law which requires a period of notice or
a lapse of time cannot be excluded, but the law provides that the period of notice or lapse of time may be agreed, that period
or lapse is one day or the minimum period the law allows to be agreed (whichever is the longer).

 

However, nothing in this clause prohibits the Secured
Party or any Receiver from giving a notice under the PPSA or any other law.

 

    		General security agreement     page 24

     

    

 

	 	10    Savings provisions

 

		10.3	Appointment of nominee for PPSA registration

 

For the purposes of section 153 of the PPSA, the
Secured Party appoints the Grantor as its nominee, and authorises the Grantor to act on its behalf, in connection with a registration
under the PPSA of any security interest in favour of the Grantor which is:

 

		(a)	evidenced or created by Chattel Paper;

 

		(b)	perfected by registration under the PPSA; and

 

		(c)	transferred to the Secured Party under this document.

 

This authority ceases when the registration is transferred
to the Secured Party.

 

		10.4	Continuing security

 

The Security is a continuing security despite:

 

		(a)	any settlement of account; or

 

		(b)	the occurrence of any other thing,

 

and remains in full force and effect until the Secured
Party has given a discharge of the Security in respect of all the Secured Property under clause 3.

 

		10.5	No merger of security

 

		(a)	Nothing in this deed merges, extinguishes, postpones, lessens or otherwise prejudicially affects:

 

		(1)	any Encumbrance or indemnity in favour of the Secured Party; or

 

		(2)	any Power.

 

		(b)	No other Encumbrance or Finance Document which the Secured Party has the benefit of in any way prejudicially affects any Power.

 

		10.6	Exclusion of moratorium

 

Without limiting clause 10.7, to the extent not
excluded by law, a provision of any legislation (other than a provision of the PPSA mentioned in section 115(1) of the PPSA) which
directly or indirectly:

 

		(a)	lessens, varies or affects in favour of the Grantor any obligations under this deed or any Finance Document;

 

		(b)	stays, postpones or otherwise prevents or prejudicially affects the exercise by the Secured Party, Receiver or Attorney of
any Power; or

 

		(c)	confers any right on the Grantor or imposes any obligation on the Secured Party or a Receiver or Attorney in connection with
the exercise of any Power,

 

is negatived and excluded from this deed and any
Finance Document and all relief and protection conferred on the Grantor by or under that legislation is also negatived and excluded.

 

		10.7	Exclusion of PPSA provisions

 

To the extent the law permits:

 

		(a)	for the purposes of sections 115(1) and 115(7) of the PPSA:

 

    		General security agreement     page 25

     

    

 

	 	10    Savings provisions

 

		(1)	the Secured Party need not comply with sections 95, 118, 121(4), 125, 132(3)(d) or 132(4); and

 

		(2)	section 143 is excluded;

 

		(b)	for the purposes of section 115(7) of the PPSA, the Secured Party need not comply with sections 132 and 137(3);

 

		(c)	if the PPSA is amended after the date of this document to permit the Grantor and the Secured Party to agree to not comply with
or to exclude other provisions of the PPSA, the Secured Party may notify the Grantor that any of these provisions are excluded
or that the Secured Party need not comply with any of those provisions as notified to the Grantor by the Secured Party; and

 

		(d)	the Grantor agrees not to exercise its rights to make any request of the Secured Party under section 275 of the PPSA, to authorise
the disclosure of any information under that section or to waive any duty of confidence that would otherwise permit non-disclosure
under that section.

 

		10.8	Conflict

 

Where any right, power, authority, discretion or
remedy conferred on the Secured Party, Receiver or Attorney by this deed or any Finance Document is inconsistent with the powers
conferred by applicable law then, to the extent not prohibited by that law, those powers conferred by applicable law are regarded
as negatived or varied to the extent of the inconsistency.

 

		10.9	Consent of Secured Party

 

		(a)	Whenever the doing of any thing by the Grantor is dependent on the consent of the Secured Party, the Secured Party may withhold
its consent or give it conditionally or unconditionally in its absolute discretion unless expressly stated otherwise in a Finance
Document.

 

		(b)	Any conditions imposed on the Grantor under clause 10.9(a) must be complied with by the Grantor.

 

		10.10	Completion of blank securities

 

		(a)	The Secured Party, a Receiver, Attorney or any Officer of the Secured Party may at any time complete, in favour of the Secured
Party, any appointee of the Secured Party or any purchaser, any instrument executed in blank by or on behalf of the Grantor and
deposited with the Secured Party as security under this deed or under any Collateral Security.

 

		(b)	The Secured Party, a Receiver, Attorney or any Officer of the Secured Party must not exercise any Power under clause 10.10(a)
until an Event of Default occurs but a breach of this clause 10.10(b) does not affect the validity of the act of the Secured Party,
Receiver, Attorney or Officer of the Secured Party.

 

		10.11	Principal obligations

 

The Security and each Collateral Security is:

 

		(a)	a principal obligation and is not ancillary or collateral to any other Encumbrance (other than another Collateral Security)
or other obligation; and

 

    		General security agreement     page 26

     

    

 

	 	11    Third party provisions

 

		(b)	independent of, and unaffected by, any other Encumbrance or other obligation which the Secured Party may hold at any time in
respect of the Secured Moneys.

 

		10.12	No obligation to marshal

 

The Secured Party is not required to marshal or
to enforce or apply under, or appropriate, recover or exercise:

 

		(a)	any Encumbrance or Collateral Security held, at any time, by the Secured Party; or

 

		(b)	any moneys or assets which the Secured Party, at any time, holds or is entitled to receive.

 

		10.13	Non avoidance

 

If any payment by the Grantor to the Secured Party
is at any time avoided for any reason including any legal limitation, disability or incapacity of or affecting the Grantor or any
other thing, and whether or not:

 

		(a)	any transaction relating to the Secured Moneys was illegal, void or substantially avoided; or

 

		(b)	any thing was or ought to have been within the knowledge of the Secured Party,

 

the Grantor:

 

		(c)	as an additional, separate and independent obligation, indemnifies the Secured Party against that avoided payment; and

 

		(d)	acknowledges that any liability of the Grantor under the Finance Documents and any Power is the same as if that payment had
not been made.

 

		10.14	Increase in financial accommodation

 

The Secured Party may at any time increase the financial
accommodation provided under any Finance Document or otherwise provide further financial accommodation.

 

		11	Third party provisions

 

		11.1	Suspense account

 

		(a)	The Secured Party may apply to the credit of a suspense account any:

 

		(1)	amounts received under this deed;

 

		(2)	dividends, distributions or other amounts received in respect of the Secured Moneys in any liquidation; and

 

		(3)	other amounts received from any Transaction Party or any other person in respect of the Secured Moneys.

 

		(b)	The Secured Party may retain the amounts in the suspense account for as long as it determines and is not obliged to apply them
in or towards satisfaction of the Secured Moneys.

 

    		General security agreement     page 27

     

    

 

	 	11    Third party provisions

 

		11.2	Independent obligations

 

This deed is enforceable against the Grantor:

 

		(a)	without first having recourse to any Collateral Security;

 

		(b)	whether or not the Secured Party or any other person has:

 

		(1)	made demand on any Transaction Party other than the Grantor;

 

		(2)	given notice to any Transaction Party (other than the Grantor) or any other person in respect of any thing; or

 

		(3)	taken any other steps against any Transaction Party (other than the Grantor) or any other person;

 

		(c)	whether or not any Secured Moneys is then due and payable; and

 

		(d)	despite the occurrence of any event described in clause 11.3.

 

		11.3	Unconditional nature of obligations

 

		(a)	The Security and the obligations of the Grantor under the Finance Documents are absolute, binding and unconditional in all
circumstances and are not released or discharged or otherwise affected by anything which but for this provision might have that
effect, including:

 

		(1)	the grant to any Transaction Party or any other person of any time, waiver, covenant not to sue or other indulgence;

 

		(2)	the release (including a release as part of any novation) or discharge of any Transaction Party or any other person;

 

		(3)	the cessation of the obligations, in whole or in part, of any Transaction Party or any other person under any Finance Document
or any other document or agreement;

 

		(4)	the liquidation of any Transaction Party or any other person;

 

		(5)	any arrangement, composition or compromise entered into by the Secured Party, any Transaction Party or any other person;

 

		(6)	any Finance Document or any other document or agreement being in whole or in part illegal, void, voidable, avoided, unenforceable
or otherwise of limited force or effect;

 

		(7)	any extinguishment, failure, loss, release, discharge, abandonment, impairment, compounding, composition or compromise, in
whole or in part of any Finance Document or any other document or agreement;

 

		(8)	any Collateral Security being given to the Secured Party, or any other person by any Transaction Party or any other person;

 

		(9)	any alteration, amendment, variation, supplement, renewal or replacement of any Finance Document or any other document or agreement
or any increase in the limit or maximum principal amount available under the Finance Documents;

 

		(10)	any moratorium or other suspension of any Power;

 

		(11)	the Secured Party, Receiver or Attorney exercising or enforcing, delaying or refraining from exercising or enforcing, or being
not entitled or unable to exercise or enforce any Power;

 

    		General security agreement     page 28

     

    

 

	 	11    Third party provisions

 

		(12)	the Secured Party obtaining a judgment against any Transaction Party or any other person for the payment of any of the Secured
Moneys;

 

		(13)	any transaction, agreement or arrangement that may take place with the Secured Party, any Transaction Party or any other person;

 

		(14)	any payment to the Secured Party, Receiver or Attorney including any payment which at the payment date or at any time after
the payment date is, in whole or in part, illegal, void, voidable, avoided or unenforceable;

 

		(15)	any failure to give effective notice to any Transaction Party or any other person of any default under any Finance Document
or any other document or agreement;

 

		(16)	any legal limitation, disability or incapacity of any Transaction Party or of any other person;

 

		(17)	any breach of any Finance Document or any other document or agreement;

 

		(18)	the acceptance of the repudiation of, or termination of, any Finance Document or any other document or agreement;

 

		(19)	any Secured Moneys being irrecoverable for any reason;

 

		(20)	any disclaimer by any Transaction Party or any other person of any Finance Document or any other document or agreement;

 

		(21)	any assignment, novation, assumption or transfer of, or other dealing with, any Powers or any other rights or obligations under
any Finance Document or any other document or agreement;

 

		(22)	the opening of a new account of any Transaction Party with the Secured Party or any transaction on or relating to the new account;

 

		(23)	any prejudice (including material prejudice) to any person as a result of any thing done, or omitted by the Secured Party,
any Transaction Party or any other person;

 

		(24)	any prejudice (including material prejudice) to any person as a result of the Secured Party, Receiver, Attorney or any other
person selling or realising any property the subject of a Collateral Security at less than the best price;

 

		(25)	any prejudice (including material prejudice) to any person as a result of any failure or neglect by the Secured Party, Receiver,
Attorney or any other person to recover the Secured Moneys from any Transaction Party or by the realisation of any property the
subject of a Collateral Security;

 

		(26)	any prejudice (including material prejudice) to any person as a result of any other thing;

 

		(27)	the receipt by the Secured Party of any dividend, distribution or other payment in respect of any liquidation;

 

		(28)	the capacity in which a Transaction Party executed a Finance Document not being the capacity disclosed to the Secured Party
before the execution of the Finance Document;

 

		(29)	the failure of any other Transaction Party or any other person who is intended to become a co-surety or co-indemnifier of that
Transaction Party to execute any Finance Document or any other document; or

 

    		General security agreement     page 29

     

    

 

	 	11    Third party provisions

 

		(30)	any other act, omission, matter or thing whether negligent or not.

 

		(b)	Clause 11.3(a) applies irrespective of:

 

		(1)	the consent or knowledge or lack of consent or knowledge, of the Secured Party, any Transaction Party or any other person of
any event described in clause 11.3(a) (and the Grantor irrevocably waives any duty on the part of the Secured Party to disclose
such information); or

 

		(2)	any rule of law or equity to the contrary.

 

		11.4	No competition

 

		(a)	Until the Secured Moneys have been fully paid and the Security has been finally discharged under clause 3, the Grantor is not
entitled to:

 

		(1)	be subrogated to the Secured Party;

 

		(2)	claim or receive the benefit of any Encumbrance, Guarantee (including any Finance Document) or other document or agreement
of which the Secured Party has the benefit;

 

		(3)	claim or receive the benefit of any moneys held by the Secured Party;

 

		(4)	claim or receive the benefit of any Power;

 

		(5)	either directly or indirectly prove in, claim or receive the benefit of any distribution, dividend or payment arising out of
or relating to the liquidation of any Transaction Party, except in accordance with clause 11.4(b);

 

		(6)	make a claim or exercise or enforce any right, power or remedy (including under an Encumbrance or Guarantee or by way of contribution)
against any Transaction Party liable to pay the Secured Moneys or against any asset of any such Transaction Party, whether such
right, power or remedy arises under or in connection with this deed, any other Finance Document or otherwise;

 

		(7)	accept, procure the grant of, or allow to exist any Encumbrance in favour of the Grantor from any Transaction Party liable
to pay the Secured Moneys;

 

		(8)	exercise or attempt to exercise any right of set-off against, nor realise any Encumbrance taken from, any Transaction Party
liable to pay the Secured Moneys; or

 

		(9)	raise any defence or counterclaim in reduction or discharge of its obligations under the Finance Documents.

 

		(b)	If required by the Secured Party, the Grantor must prove in any liquidation of a Transaction Party liable to pay the Secured
Moneys for all moneys owed to the Grantor.

 

		(c)	All moneys recovered by the Grantor from a Transaction Party liable to pay the Secured Moneys from any liquidation or under
any Encumbrance or Guarantee (whether the Encumbrance or Guarantee is a Finance Document or otherwise) must be paid to the Secured
Party to the extent of the unsatisfied liability of the Grantor under the Finance Documents.

 

		(d)	The Grantor must not do or seek, attempt or purport to do anything referred to in clause 11.4(a).

 

    		General security agreement     page 30

     

    

 

	 	12    General

 

		12	General

 

		12.1	Confidential information

 

The Secured Party must not disclose to any person:

 

		(a)	this deed; or

 

		(b)	any information about any Transaction Party,

 

except where permitted under the Principal Agreement.

 

		12.2	Performance by Secured Party of the Grantor’s obligations

 

If the Grantor defaults in fully and punctually
performing any obligation contained or implied in any Finance Document, the Secured Party may, without prejudice to any Power,
do all things necessary or desirable, in the opinion of the Secured Party, to make good or attempt to make good that default to
the satisfaction of the Secured Party.

 

		12.3	Grantor to bear cost

 

Any thing which must be done by the Grantor under
this deed, whether or not at the request of the Secured Party, must be done at the cost of the Grantor.

 

		12.4	Notices

 

Any notice or other communication including any
request, demand, consent or approval, to or by a party to this deed must be given in accordance with the notice requirements of
the Principal Agreement to the addressees set out in Schedule 1.

 

		12.5	Governing law and jurisdiction

 

		(a)	This deed is governed by the laws of Victoria.

 

		(b)	Without limiting clause 12.5(a), for the purposes of section 237 of the PPSA, the law of the Commonwealth of Australia as that
law applies in the jurisdiction specified in clause 12.5(a) governs the Security to the extent it is permitted to apply to the
Secured Property under that section.

 

		(c)	The parties irrevocably submit to the non-exclusive jurisdiction of the courts of Victoria.

 

		(d)	The parties irrevocably waive any objection to the venue of any legal process on the basis that the process has been brought
in an inconvenient forum.

 

		(e)	The parties irrevocably waive any immunity in respect of its obligations under this deed that it may acquire from the jurisdiction
of any court or any legal process for any reason including the service of notice, attachment before judgment, attachment in aid
of execution or execution.

 

		12.6	Prohibition and enforceability

 

		(a)	Any provision of, or the application of any provision of, any Finance Document or any Power which is prohibited in any jurisdiction
is, in that jurisdiction, ineffective only to the extent of that prohibition.

 

		(b)	Any provision of, or the application of any provision of, any Finance Document which is void, illegal or unenforceable in any
jurisdiction does not affect the validity, legality or enforceability of that provision in any other jurisdiction or of the remaining
provisions in that or any other jurisdiction.

 

    		General security agreement     page 31

     

    

 

	 	12    General

 

		12.7	Waivers

 

		(a)	Waiver of any right arising from a breach of this deed or of any Power arising upon default under this deed or upon the occurrence
of an Event of Default must be in writing and signed by the party granting the waiver.

 

		(b)	A failure or delay in exercise, or partial exercise, of:

 

		(1)	a right arising from a breach of this deed or the occurrence of an Event of Default; or

 

		(2)	a Power created or arising upon default under this deed or upon the occurrence of an Event of Default,

 

does not result in a waiver of that right or Power.

 

		(c)	A party is not entitled to rely on a delay in the exercise or non-exercise of a right or Power arising from a breach of this
deed or on a default under this deed or on the occurrence of an Event of Default as constituting a waiver of that right or Power.

 

		(d)	A party may not rely on any conduct of another party as a defence to exercise of a right or Power by that other party.

 

		(e)	This clause may not itself be waived except by writing.

 

		12.8	Variation

 

A variation of any term of this deed must be in
writing and signed by the parties.

 

		12.9	Cumulative rights

 

The Powers are cumulative and do not exclude any
other right, power, authority, discretion or remedy of the Secured Party, Receiver or Attorney.

 

		12.10	Assignment

 

		(a)	Subject to any Finance Document, the Secured Party may assign its rights under this deed and each Collateral Security without
the consent of the Grantor.

 

		(b)	The Grantor must not assign any of its rights under this deed or any Collateral Security without the prior written consent
of the Secured Party.

 

		12.11	Counterparts

 

This deed may be executed in any number of counterparts.
All counterparts taken together, constitute one instrument. A party may execute this deed by signing any counterpart.

 

		12.12	Attorneys

 

Each of the attorneys executing this deed states
that the attorney has no notice of the revocation of the power of attorney appointing that attorney.

 

    		General security agreement     page 32

     

    

 

 

 

Schedules

 

	Table of contents	 
	 	 
	Notice details	35
	 	 
	Serial numbered goods or intangible property	36
	 	 
	Secured Property with a value greater than $25,000 located outside Australia	38
	 	 
	Disclosed Contracts	39
	 	 
	Secured Property in relation to which the Security may be perfected by control	40

 

    		General security agreement     page 33

     

    

 

 

 

Schedule 1

 

Notice details

 

	 	Discovery Energy SA Pty Ltd
	 	 
	Address	Level 8, 350 Collins Street, 

Melbourne 3000 

Australia
	 	 
	Attention	Andrew Adams and Keith Spickelmier
	 	 
	Phone	+61.3.8601.1131
	 	 
	Fax	
        +61.3.8601.1180

        (713) 622-1937

	Email	Andrew@adamsmanagement.com.au; kspickelmier1@comcast.net; kim@discoveryenergy.com
	 	 

 

	 	DEC Funding LLC
	 	 
	Address	
        c/o Avista Capital Partners

        1000 Louisiana Street, Suite 3700

        Houston, Texas 77002

        United States of America

	 	 
	Attention	Steven Webster
	 	 
	Phone	(713) 328-1051
	 	 
	Fax	(713) 328-1097
	 	 
	Email	webster@avistacap.com
	 	 

 

    		General security agreement     page 34

     

    

 

 

 

Schedule 2

 

Serial numbered goods or
intangible property

 

Clause 4.1(e)

 

	Goods	Serial Number
	
        Motor vehicle:

        Vehicle identification number (VIN)

        If no VIN, chassis number

        If no chassis number, manufacturer’s number
	None
	
        Watercraft:

        official number

        if none, the hull identification number

        If an outboard motor, manufacturer’s number
	None
	
        Aircraft: 

        For engine, airframe or helicopter:

        manufacturer’s serial number

        manufacturer’s name

        manufacturer’s generic model description
	None
	
        Goods

        For small aircraft: nationality and registration marks assigned
        to it under the Chicago Convention
	
        None

         

	Intangible property	Serial Number
	Trade mark: IP Australia trade mark number/trade mark application number	None
	Patent: IP Australia patent number/patent application number	None

 

    		General security agreement     page 35

     

    

 

	 	Schedule 2    Serial numbered goods or intangible property

 

	Intangible property	Serial Number
	Design: IP Australia design number/design application number	None
	Plant breeder’s right: IP Australia plant breeder’s right number/plant breeder’s right application number	None
	Licence over a Trade Mark, Patent, Design or Plant Breeder’s right	None
	IP Australia serial number (use serial number of corresponding trade mark, patent, design or plant breeder’s right)	None

 

    		General security agreement     page 36

     

    

 

 

 

Schedule 3

 

Secured Property with a value
greater than $25,000 located outside Australia

 

None

 

    		General security agreement     page 37

     

    

 

 

 

Schedule 4

 

Disclosed Contracts

 

None.

 

    		General security agreement     page 38

     

    

 

	 	Schedule 5    Serial numbered goods or intangible property

 

Schedule 5

 

Secured Property in relation
to which the Security may be perfected by control

 

None

 

    		General security agreement     page 39

     

    

 

 

 

Signing page

 

Executed as a deed

 

	 	Grantor
	 	 
	 	
        Signed sealed and delivered by

        Discovery Energy SA Pty Ltd

        by

	 	 
	sign here ►	/s/ William E. Begley	 
	 	Company Secretary/Director	 
	 	 	 
	print name	 	 
	 	 	 
	sign here ►	/s/ Michael D. Dahlke	 
	 	Director	 
	 	 	 
	print name	 	 

 

    		General security agreement     page 40

     

    

 

	 	Schedule 5    Signing page

 

	 	Secured Party
	 	 
	 	Signed sealed and delivered for

DEC Funding LLC	 
	 	 	 
	sign here ►	/s/ Steven Webster	 
	 	Authorised Signatory	 
	 	 	 
	print name	 	 
	 	 	 
	 	in the presence of	 
	 	 	 
	sign here ►	 	 
	 	Witness	 
	 	 	 
	print name	 	 
	 	 	 
	print address	 	 

 

    		General security agreement     page 41Exhibit 10.07

 

		 

 

Deed

 

	Deed of guarantee and	 
	indemnity	 

 

Discovery Energy SA Pty Ltd

 

DEC Funding LLC 

 

	 	ANZ Tower 161
    Castlereagh Street Sydney NSW 2000 Australia
 GPO Box 4227
    Sydney NSW 2001 Australia 	 	T +61 2 9225 5000 F +61 2 9322 4000

herbertsmithfreehills.com DX 361 Sydney 

 

      
 

     

    

 

Contents

 

	 	Table of contents	 
	 	 	 	 
	 	 	 	 
	1	Definitions, interpretation and deed components	2
	 	 	 
	 	1.1	Definitions	2
	 	1.2	Interpretation	7
	 	1.3	Incorporated definitions	8
	 	1.4	Interpretation of inclusive expressions	8
	 	1.5	Business Day	8
	 	1.6	Unconditional and irrevocable obligations	8
	 	1.7	Accounting Standards	8
	 	1.8	Deed components	8
	 	 	 	 
	2	Guarantee	8
	 	 	 
	 	2.1	Guarantee	8
	 	2.2	Payment	8
	 	 	 	 
	3	Payments	9
	 	 	 
	 	3.1	Manner of payment	9
	 	3.2	Payments in gross	9
	 	3.3	Additional payments	9
	 	3.4	Taxation deduction procedures	9
	 	3.5	Tax Credit	10
	 	3.6	Tax affairs	10
	 	3.7	Noteholder’s statement of indebtedness	10
	 	3.8	Securities for other moneys	10
	 	3.9	Amounts payable on demand	10
	 	3.10	Set off	11
	 	 	 	 
	4	Representations and warranties	11
	 	 	 
	 	4.1	Representations and warranties	11
	 	4.2	Survival of representations and warranties	12
	 	4.3	Reliance by the Noteholder	12
	 	4.4	No reliance on the Noteholder	12
	 	 	 	 
	5	Undertakings, consents and acknowledgments	12
	 	 	 
	 	5.1	Amount of the Guaranteed Moneys	12
	 	5.2	Proof by Noteholder	13
	 	5.3	Retention of deed	13
	 	5.4	Further assurances	13
	 	5.5	Negative pledge	14
	 	5.6	Provision of information and reports	14
	 	5.7	Proper accounts	14
	 	5.8	Notices to the Noteholder	14
	 	5.9	Term of undertakings	14
	 	 	 	 
	6	Indemnities	15
	 	 	 
	 	6.1	General indemnity	15
	 	6.2	Indemnity for avoidance of Guaranteed Moneys	15
	 	6.3	Foreign currency indemnity	16
	 	6.4	Conversion of Currencies	16
	 	6.5	Indemnity payment	16

 

    		Contents 1

     

    

 

 

Contents

 

	7	Tax,
    costs and expenses	16
	 	 	 
	 	7.1	Tax	16
	 	7.2	Costs and expenses	17
	 	7.3	GST	17
	 	 	 	 
	8	Interest
    on overdue amounts	17
	 	 	 
	 	8.1	Payment of interest	17
	 	8.2	Accrual of interest	18
	 	8.3	Rate of interest	18
	 	 	 	 
	9	Saving
    provisions	18
	 	 	 
	 	9.1	No merger of security	18
	 	9.2	Exclusion of moratorium	18
	 	9.3	Exclusion of PPSA
    provisions	19
	 	9.4	Conflict	19
	 	9.5	Consent of Noteholder	19
	 	9.6	Non-exercise of
    Guarantor’s rights	19
	 	9.7	Principal obligations	19
	 	9.8	No obligation to
    marshal	19
	 	9.9	Non avoidance	20
	 	9.10	Continuing guarantee
    and indemnities	20
	 	 	 	 
	10	Third
    party provisions	20
	 	 	 
	 	10.1	Suspense account	20
	 	10.2	Independent obligations	21
	 	10.3	Unconditional nature
    of obligations	21
	 	10.4	No competition	23
	 	 	 	 
	11	General	24
	 	 	 
	 	11.1	Confidential information	24
	 	11.2	Guarantor to bear
    cost	25
	 	11.3	Notices	25
	 	11.4	Governing law and
    jurisdiction	25
	 	11.5	Prohibition and
    enforceability	26
	 	11.6	Waivers	26
	 	11.7	Variation	26
	 	11.8	Cumulative rights	26
	 	11.9	Assignment	27
	 	11.10	Counterparts	27
	 	11.11	Attorneys	27
	 	 	 	 
	 	Signing
    page	28
	 	 	 
	 	Herbert Smith Freehills owns the copyright in this document and using it without
    permission is strictly prohibited.

 

    		Contents 2

     

    

 

 

	Deed of guarantee and indemnity	 
	 	 
	 	 
	Date ►	27 May 2016	
	 	 
	Between the parties	 
	 	 

 

	Guarantor	
        Discovery Energy SA Pty Ltd

         

        ABN 89 158 204 052 of Level 8, 350 Collins Street,

        Melbourne 3000

        Australia

	 	 
	 	 
	Noteholder	
        DEC Funding LLC, a Texas limited liability company

         

        c/o Avista Capital Partners, 1000 Louisiana Street, Suite 3700,

        Houston, Texas 77002

	 	 
	 	 
	Recitals	The Guarantor agrees to grant the guarantee and indemnities in this deed.
	 	 
	 	 
	This deed witnesses:	
        that, for valuable consideration, the receipt
and sufficiency of which is acknowledged, the parties agree as follows:

	 	 

 

    		page 1

     

    

 

 

	1	Definitions, interpretation and deed
    components

 

	1.1	Definitions
	 	 
	 	The meanings of the terms used in this deed are set out below.
	 	 

	 	Term	Meaning
	 	 	 
	 	 	 
	 	Accounting Standards	generally accepted accounting principles in Australia.
	 	 	 
	 	Attorney	an attorney appointed under any Transaction Document.
	 	 	 
	 	Australian Security Agreement	the general security deed between the Guarantor and the Noteholder dated on or about the date of this deed.
	 	 	 
	 	 	 
	 	Authorisation	
        1    any consent,
        registration, filing, agreement, notice of non-objection, notarisation, certificate, licence, approval, permit, authority or exemption;
        or

         

        2    in relation
        to anything that a Government Agency may prohibit or restrict within a specific period, the expiry of that period without intervention
        or action or notice of intended intervention or action.

	 	 	 
	 	 	 
	 	Business Day	
        1    for the
        purposes of clause 11.3, a day on which banks are open for business in the city where the notice or other communication is received
        excluding a Saturday, Sunday or public holiday; and

         

        2    for all
        other purposes, a day on which banks are open for business in New York excluding a Saturday, Sunday or public holiday.

	 	 	 
	 	 	 
	 	Collateral Security	any present or future Encumbrance, Guarantee or other document or agreement created or entered into by a Transaction Party or any other person as security for, or to credit enhance the payment of any of the Guaranteed Moneys.
	 	 	 
	 	 	 
	 	Corporations Act	the Corporations Act 2001 (Cth).
	 	 	 
	 	 	 
	 	Debtor	Discovery Energy Corp., a Nevada corporation, having its principal place of business at One Riverway Drive, Suite 1700, Houston, Texas 77056
	 	 	 

 

    		page 2

     

    

 

 

	 	Term	Meaning
	 	 	 
	 	 	 
	 	Dollars, A$ and $	the lawful currency of the Commonwealth of Australia.	 
	 	 	 	 
	 	 	 	 
	 	Encumbrance	
        an interest or power:

         

        1     reserved
        in or over an interest in any asset including any retention of title; or.

         

        2     created
        or otherwise arising in or over any interest in any asset under a security agreement, bill of sale, mortgage, charge, lien, pledge,
        trust or power or any other agreement having similar effect,

         

        by way of, or having similar commercial effect to, security
        for the payment of a debt, any other monetary obligation or the performance of any other obligation, and includes any agreement
        to grant or create any of the above and includes a security interest within the meaning of section 12(1) of the PPSA.
	 
	 	 	 	 
	 	 	 	 
	 	Event of Default	has the same meaning as in the Principal Agreement.	 
	 	 	 	 
	 	 	 	 
	 	Excluded Tax	
        a Tax imposed by any jurisdiction on the net income of the Noteholder
        but not a Tax:

         

        1    calculated
        on or by reference to the gross amount of any payment (without allowance for any deduction) derived by the Noteholder under a Transaction
        Document or any other document referred to in a Transaction Document; or

         

        2    imposed
        as a result of the Noteholder being considered a resident of or organised or doing business in that jurisdiction solely as a result
        of it being a party to a Transaction Document or any transaction contemplated by a Transaction Document.
	 
	 	 	 	 
	 	 	 	 
	 	Financial Report	
        in relation to an entity, the following financial statements
        and information in relation to the entity, prepared for its financial half year or financial year:

         

        1     a statement of financial
        performance;

         

        2     a statement of financial
        position; and

         

        3     a statement of cashflows,

         

        together with any notes to those documents and any accompanying
        reports, statements, declarations and other documents or information.
	 
	 	 	 	 
	 	 	 	 
	 	Government Agency	any government or any governmental, semi-governmental, administrative, fiscal or judicial body, department, commission, authority, tribunal, agency or entity.	 
	 	 	 	 

 

    		page 3

     

    

 

 

	 	Term	Meaning
	 	 	 
	 	 	 
	 	GST	the goods and services tax levied under the GST Act.
	 	 	 
	 	 	 
	 	GST Act	the A New Tax System (Goods and Services Tax) Act 1999 (Cth).
	 	 	 
	 	 	 
	 	Guarantee	
        any guarantee, suretyship, letter of credit, letter of comfort
        or any other obligation:

         

        1     to provide
        funds (whether by the advance or payment of money, the purchase of or subscription for shares or other securities, the purchase
        of assets or services, or otherwise) for the payment or discharge of;3

         

        2     to indemnify
        any person against the consequences of default in the payment of; or

         

        3     to be responsible
        for,

         

        any debt or monetary liability or obligation (whether or not
        it involves the payment of money) of another person or the assumption of any responsibility or obligation in respect of the insolvency
        or the financial condition of any other person but excludes this deed.

	 	 	 
	 	 	 
	 	Guaranteed Moneys	
        all debts and monetary liabilities of the Debtor to the Noteholder
        under or in relation to any Transaction Document, and in any capacity, irrespective of whether the debts or liabilities:

         

        1     are present
        or future;

         

        2     are actual,
        prospective, contingent or otherwise;

         

        3     are at any
        time ascertained or unascertained;

         

        4     are owed
        or incurred by or on account of the Debtor alone, or severally or jointly with any other person;

         

        5     are owed
        to or incurred for the account of the Noteholder alone, or severally or jointly with any other person;

         

        6     are owed
        or incurred as principal, interest, fees, charges, Taxes, damages (whether for breach of contract or tort or incurred on any other
        ground), losses, costs or expenses, or on any other account;

         

        7     are owed
        to or incurred for the account of the Noteholder directly or as a result of:

         

        ·    the
        assignment or transfer to the Noteholder of any debt or liability of the Debtor (whether by way of assignment, transfer or otherwise);
        or

         

        ·    any
        other dealing with any such debt or liability; or

         

        8    comprise
        any combination of the above.

	 	 	 
	 	 	 
	 	Loss	any claim, action, damage, loss, liability, cost, charge, expense, outgoing or payment.
	 	 	 

 

    		page 4

     

    

 

 

	 	Term	Meaning
	 	 	 
	 	 	 
	 	Marketable Securities	marketable securities as defined in section 9 of the Corporations Act.
	 	 	 
	 	 	 
	 	Material Adverse Effect	
        a material adverse effect on:

         

        1     the ability
        of the Guarantor to perform any of its payment obligations under any Transaction Document to which it is a party;

         

        2     the enforceability
        or priority of a Transaction Document or any Encumbrance provided for by a Transaction Document; or

         

        3    the assets,
        business or operations of the Guarantor.

	 	 	 
	 	 	 
	 	Officer	
        1     in relation
        to the Guarantor, a director or a secretary or a person notified to the Noteholder to be an authorised officer of the Guarantor;
        and

         

        2     in relation
        to the Noteholder, any person whose title includes the word ‘Director’, ‘Managing Director’, ‘Manager’
        or ‘Vice President’, and any other person appointed by the Noteholder to act as its authorised officer for the purposes
        of this deed.

	 	 	 
	 	 	 
	 	Payment Currency	the currency in which a payment is actually made.
	 	 	 
	 	 	 
	 	Power	any right, power, authority, discretion or remedy conferred on the Noteholder by any Transaction Document or any applicable law.
	 	 	 
	 	 	 
	 	PPSA	the Personal Property Securities Act 2009 (Cth).
	 	 	 
	 	 	 
	 	PPSA Security Interest	a security interest as defined in the PPSA.
	 	 	 
	 	 	 
	 	Principal Agreement	the terms of the Senior Secured Convertible Debentures issued by the Debtor to the Noteholder on [#] 2016 and thereafter.
	 	 	 
	 	 	 
	 	Receiver	a receiver or receiver and manager appointed under a Transaction Document.
	 	 	 
	 	 	 
	 	Related Body Corporate	a ‘related body corporate’ as defined in section 50 of the Corporations Act.
	 	 	 
	 	 	 
	 	Relevant Currency	the currency in which a payment is required to be made under the Transaction Documents and, if not expressly stated to be another currency, is US Dollars.
	 	 	 

 

    		page 5

     

    

 

 

	 	Term	Meaning
	 	 	 
	 	 	 
	 	Same Day Funds	immediately available and freely transferable funds.
	 	 	 
	 	 	 
	 	Securities Purchase Agreement	the purchase agreement for the Senior Secured Convertible Debentures dated 27 May 2016 between the Debtor and the Noteholder.
	 	 	 
	 	 	 
	 	Specific Security Agreement	the document entitled ‘Specific Security Agreement (Shares)’ between the Guarantor and the Noteholder dated on or about the date of this deed.
	 	 	 
	 	 	 
	 	Subsidiary	a subsidiary as defined in section 46 of the Corporations Act.
	 	 	 
	 	 	 
	 	Tax	
        1      any tax
        including GST, levy, charge, impost, duty, fee, deduction, compulsory loan or withholding; or

         

        2     any income,
        stamp or transaction duty, tax or charge,

         

        which is assessed, levied, imposed or collected by any Government
        Agency and includes any interest, fine, penalty, charge, fee or other amount imposed on, or in respect of, any of the above.

	 	 	 
	 	 	 
	 	Transaction Document	
        1     this deed;

         

        2     the Principal
        Agreement;

         

        3     the US Security
        Agreement;

         

        4     the Securities
        Purchase Agreement;

         

        5     the Australian
        Security Agreement;

         

        6     the Specific
        Security Agreement,

         

        or any document or agreement entered into or given under any
        of the above.

	 	 	 
	 	 	 
	 	Transaction Party	
        1the Guarantor; or

         

        2the Debtor.

	 	 	 
	 	 	 
	 	US Security Agreement	the security agreement for the Senior Secured Convertible Debentures dated 27 May 2016 between the Debtor, all of the Debtor’s subsidiaries and the Noteholder.
	 	 	 

 

    		page 6

     

    

 

 

		1.2	Interpretation

 

In this deed:

 

		(a)	Headings and bold type are for convenience only and do not affect the interpretation of this deed.

 

		(b)	The singular includes the plural and the plural includes the singular.

 

		(c)	Words of any gender include all genders.

 

		(d)	Other parts of speech and grammatical forms of a word or phrase defined in this deed have a corresponding meaning.

 

		(e)	An expression importing a person includes any company, partnership, joint venture, association, corporation or other body corporate
and any Government Agency as well as an individual.

 

		(f)	A promise on the part of 2 or more persons binds them jointly and severally.

 

		(g)	A reference to any thing (including any right) includes a part of that thing but nothing in this clause 1.2(g) implies that
performance of part of an obligation constitutes performance of the obligation.

 

		(h)	A reference to a clause, party, schedule, attachment or exhibit is a reference to a clause of, and a party, schedule, attachment
or exhibit to, this deed.

 

		(i)	A reference to any legislation includes all delegated legislation made under it and amendments, consolidations, replacements
or re-enactments of any of them.

 

		(j)	A reference to a document includes all amendments or supplements to, or replacements or novations of, that document.

 

		(k)	A reference to a party to a document includes that party’s successors and permitted assignees.

 

		(l)	A reference to an agreement other than this deed includes a deed and any legally enforceable undertaking, agreement, arrangement
or understanding, whether or not in writing.

 

		(m)	A reference to an asset includes all property of any nature, including a business, and all rights, revenues and benefits.

 

		(n)	A reference to liquidation or insolvency includes appointment of an administrator, compromise, arrangement, merger, amalgamation,
reconstruction, winding up, dissolution, deregistration, assignment for the benefit of creditors, scheme, composition or arrangement
with creditors, insolvency, bankruptcy, or a similar procedure or, where applicable, changes in the constitution of any partnership
or person, or death.

 

		(o)	A reference to a document includes any agreement in writing, or any certificate, notice, instrument or other document of any
kind.

 

		(p)	No provision of this deed will be construed adversely to a party because that party was responsible for the preparation of
this deed or that provision.

 

		(q)	A reference to a body, other than a party to this deed (including an institute, association or authority), whether statutory
or not:

 

		(1)	which ceases to exist; or

 

		(2)	whose powers or functions are transferred to another body,

 

is a reference to the body that replaces it or that
substantially succeeds to its powers or functions.

 

    		page 7

     

    

 

 

		(r)	References to time are to Melbourne time.

 

		(s)	Where this deed confers any power or authority on a person that power or authority may be exercised by that person acting personally
or through an agent or attorney.

 

		1.3	Incorporated definitions

 

A word or phrase (other than one defined in clause
1.1) defined in the Principal Agreement has the same meaning in this deed.

 

		1.4	Interpretation of inclusive expressions

 

Specifying anything in this deed after the words
‘include’ or ‘for example’ or similar expressions does not limit what else is included unless there is
express wording to the contrary.

 

		1.5	Business Day

 

Where the day on or by which any thing is to be
done is not a Business Day, that thing must be done on or by the next Business Day.

 

		1.6	Unconditional and irrevocable obligations

 

Each of the obligations of the Guarantor under this
deed is unconditional and irrevocable.

 

		1.7	Accounting Standards

 

Any accounting practice or concept relevant to this
deed is to be construed or determined in accordance with the Accounting Standards.

 

		1.8	Deed components

 

This deed includes any schedule.

 

	2	Guarantee

 

		2.1	Guarantee

 

The Guarantor guarantees to the Noteholder the payment
of the Guaranteed Moneys.

 

		2.2	Payment

 

		(a)	If the Guaranteed Moneys are not paid when due, the Guarantor must immediately on demand from the Noteholder pay to the Noteholder
the Guaranteed Moneys in the same manner and currency as the Guaranteed Moneys are required to be paid.

 

		(b)	A demand under clause 2.2(a) may be made at any time and from time to time.

 

    		page 8

     

    

 

 

	3	Payments

 

		3.1	Manner of payment

 

All payments to the Noteholder under this deed must
be made:

 

		(a)	in Same Day Funds;

 

		(b)	in the Relevant Currency;

 

		(c)	not later than 11.00am on the date specified in the demand made under clause 2.2,

 

to the Noteholder’s account as specified by
the Noteholder to the Guarantor or in any other manner the Noteholder directs from time to time.

 

		3.2	Payments in gross

 

All payments which the Guarantor is required to
make under this deed must be without:

 

		(a)	any set off, counterclaim or condition; and

 

		(b)	any deduction or withholding for any Tax or any other reason, unless the Guarantor is required to make a deduction or withholding
by applicable law.

 

		3.3	Additional payments

 

If:

 

		(a)	the Guarantor is required to make a deduction or withholding in respect of Tax (other than an Excluded Tax) from any payment
it is required to make to the Noteholder under this deed; or

 

		(b)	the Noteholder is required to pay any Tax (other than an Excluded Tax) in respect of any payment it receives from the Guarantor
under this deed,

 

the Guarantor:

 

		(c)	indemnifies the Noteholder against that Tax; and

 

		(d)	must pay to the Noteholder an additional amount that the Noteholder determines to be necessary to ensure that the Noteholder
receives when due a net amount (after payment of any Tax (other than an Excluded Tax) in respect of each additional amount) that
is equal to the full amount it would have received if a deduction or withholding or payment of Tax had not been made.

 

		3.4	Taxation deduction procedures

 

If clause 3.3 applies:

 

		(a)	the Guarantor must pay the amount deducted or withheld to the appropriate Government Agency as required by law; and

 

		(b)	the Guarantor must:

 

		(1)	use reasonable endeavours to obtain a payment receipt or from the Government Agency (and any other documentation ordinarily
provided by the Government Agency in connection with the payment); and

 

		(2)	within 2 Business Days after receipt of the documents referred to in clause 3.4(b)(1), deliver copies to the Noteholder.

 

    		page 9

     

    

 

 

		3.5	Tax Credit

 

If the Guarantor makes an additional payment under
clause 3.3, and the Noteholder determines that:

 

		(a)	a credit against, relief or remission for, or repayment of any Tax (Tax Credit) is attributable to that additional payment;
and

 

		(b)	the Noteholder has obtained, utilised and retained that Tax Credit,

 

then the Noteholder must pay an amount to the Guarantor
which the Noteholder determines will leave it (after that payment) in the same after Tax position as it would have been in had
the additional payment not been made by the Guarantor.

 

		3.6	Tax affairs

 

Nothing in clause 3.5:

 

		(a)	interferes with the right of the Noteholder to arrange its tax affairs in any manner it thinks fit;

 

		(b)	obliges the Noteholder to investigate the availability of, or claim, any Tax Credit; or

 

		(c)	obliges the Noteholder to disclose any information relating to its tax affairs or any tax computations.

 

		3.7	Noteholder’s statement of indebtedness

 

A certificate signed by an Officer of the Noteholder
stating:

 

		(a)	the amount of the Guaranteed Moneys due and payable;

 

		(b)	the amount due and payable by the Guarantor under this deed; or

 

		(c)	the amount of the Guaranteed Moneys, whether currently due and payable or not,

 

is sufficient evidence, unless the contrary is proved,
of that amount at the date stated on the certificate or failing that as at the date of that certificate.

 

		3.8	Securities for other moneys

 

		(a)	The Noteholder may apply any amounts received by it or recovered under:

 

		(1)	any Collateral Security; and
	 	 	 
	 	(2)	any other document or agreement,

 

			
	 	that is a security for any of the Guaranteed Moneys
and any other moneys in such manner as it determines in its absolute discretion.

  

		(b)	The Noteholder need not apply any amounts referred to in clause 3.8(a) in or towards satisfaction of the Guaranteed Moneys.

 

		(c)	Clause 3.8(b) does not limit clause 3.8(a).

 

		3.9	Amounts payable on demand

 

If any amount payable by the Guarantor under this
deed is not expressed to be payable on a specified date, that amount is payable by the Guarantor on demand by the Noteholder.

 

    		page 10

     

    

 

 

		3.10	Set off

 

If the Guarantor or the Debtor fails to pay any
Guaranteed Moneys when due, the Noteholder may:

 

		(a)	apply any credit balance in any currency in any account of the Guarantor with the Noteholder in and towards satisfaction of
the Guaranteed Moneys; and

 

		(b)	effect any currency conversion that may be required to make any application under clause 3.10(a).

 

	4	Representations
                                         and warranties

 

		4.1	Representations and warranties

 

The Guarantor represents and warrants that:

 

		(a)	registration: it is a corporation, duly incorporated or registered (or taken to be registered) and validly existing
under the Corporations Act;

 

		(b)	corporate power: it has the corporate power to own its assets and to carry on its business as it is now being conducted;

 

		(c)	authority: it has power and authority to enter into and perform its obligations under the Transaction Documents to which
it is expressed to be a party;

 

		(d)	authorisations: it has taken all necessary action to authorise the execution, delivery and performance of the Transaction
Documents to which it is expressed to be a party;

 

		(e)	binding obligations: the Transaction Documents to which it is expressed to be a party constitute its legal, valid and
binding obligations and, subject to any necessary stamping and registration, are enforceable in accordance with their terms subject
to laws generally affecting creditors’ rights and to principles of equity;

 

		(f)	transaction permitted: the execution, delivery and performance by it of the Transaction Documents to which it is expressed
to be a party will not breach, or result in a contravention of:

 

		(1)	any law, regulation or Authorisation;

 

		(2)	its constitution or other constituent documents; or

 

		(3)	any Encumbrance or agreement that is binding on the Guarantor;

 

and will not result in:

 

		(4)	the creation or imposition of any Encumbrance on any assets of the Guarantor other than as permitted under a Transaction Document;
or

 

		(5)	the acceleration of the date of payment of any obligation under any agreement that is binding upon the Guarantor;

 

		(g)	financial information: the most recent Financial Reports and any other information that it and any of its Subsidiaries
have provided to the Noteholder before the execution of this deed or under clause 5.6:

 

		(1)	give a true and fair view of the financial condition and state of affairs of it as at the date they were prepared and of the
results of its operations for the period they cover; and

 

    		page 11

     

    

  

 

		(2)	were prepared in accordance with the Accounting Standards;

 

		(h)	no change in affairs: there has been no change in its state of affairs since the end of the accounting period for its
most recent Financial Reports referred to in clause 4.1(g) which has had or is likely to have a Material Adverse Effect;

 

		(i)	representations true: each of its representations and warranties contained in the Transaction Documents is correct and
not misleading when made or repeated;

 

		(j)	disclosure: all information provided to the Noteholder by or on its behalf in relation to it, its assets, business or
affairs or the Transaction Documents was correct and not misleading (by omission or otherwise) as at the time it was provided;

 

		(k)	no failure to disclose: it has not withheld from the Noteholder any information material to the decision of the Noteholder
to enter into the Transaction Documents to which the Noteholder is a party;

 

		(l)	not a trustee: it does not enter into any Transaction Document as trustee of any trust or settlement; and

 

		(m)	commercial benefit: the entering into and performance by it of its obligations under the Transaction Documents to which
it is expressed to be a party is for its commercial benefit and is in its commercial interests.

 

		4.2	Survival of representations and warranties

 

The representations and warranties in clause 4.1:

 

		(a)	survive the execution of this deed; and

 

		(b)	(except for the representations and warranties in clauses 4.1(i) and 4.1(j) are regarded as repeated on each describe
event with respect to the facts and circumstances then subsisting.

 

		4.3	Reliance by the Noteholder

 

The Guarantor acknowledges that the Noteholder has
entered into each Transaction Document in reliance on the representations and warranties given under this deed.

 

		4.4	No reliance on the Noteholder

 

The Guarantor acknowledges that it has not entered
into this deed or any Transaction Document in reliance on any representation, warranty, promise or statement of the Noteholder
or of any person on behalf of the Noteholder.

 

		5	Undertakings,
                                         consents and acknowledgments

 

		5.1	Amount of the Guaranteed Moneys

 

		(a)	This deed applies to any amount that forms part of the Guaranteed Moneys from time to time.

 

		(b)	The obligations of the Guarantor under this deed extend to any increase in the Guaranteed Moneys as a result of:

 

    		page 12

     

    

  

 

		(1)	any amendment, supplement, renewal or replacement of any Transaction Document to which a Transaction Party and the Noteholder
is a party; or

 

		(2)	the occurrence of any other thing.

 

		(c)	Clause 5.1(b):

 

		(1)	applies regardless of whether the Guarantor is aware of, has consented to, or is given notice of any amendment, supplement,
renewal or replacement of any agreement to which a Transaction Party and the Noteholder is a party or the occurrence of any other
thing; and

 

		(2)	does not limit the obligations of the Guarantor under this deed.

 

		5.2	Proof by Noteholder

 

In the event of the liquidation of the Debtor or
any other person liable to pay the Guaranteed Moneys, the Guarantor authorises the Noteholder to prove for all moneys that the
Guarantor has paid or is or may be obliged to pay under any Transaction Document, any other document or agreement or otherwise
in respect of the Guaranteed Moneys.

 

		5.3	Retention of deed

 

The Noteholder may retain this deed for:

 

		(a)	7 months after the payment in full of the Guaranteed Moneys; or

 

		(b)	if anything referred to in clause 9.9 has occurred or in the opinion of the Noteholder may occur, such longer period as the
Noteholder determines.

 

		5.4	Further assurances

 

The Guarantor must:

 

		(a)	do anything which the Noteholder requests to:

 

		(1)	ensure or enable the Noteholder to ensure that this deed, any PPSA Security Interest under this deed and the Powers are fully
effective, enforceable and perfected with the contemplated priority; or
	 	 	 
	 	(2)	aid the exercise of any Power,

 

			
	 	including the execution of any document or agreement;

  

		(b)	without limiting clause 5.4(a)(1), obtain and renew when necessary all Authorisations required under any law or document or
agreement, or require a third party to take any other action (including executing any document):

 

		(1)	to enable the Guarantor to perform the obligations of the Guarantor under this deed;

 

		(2)	for the validity or enforceability perfection or priority of this deed or any PPSA Security Interest under this deed; or

 

		(3)	as required to give effect to clause 5.4(a)(1); and

 

		(c)	comply with the terms of the Authorisations referred to in clause 5.4(b).

 

    		page 13

     

    

 

 

		5.5	Negative pledge

 

The Guarantor must not:

 

		(a)	sell, assign, transfer or otherwise dispose of or part with possession of;

 

		(b)	create or allow to exist, or agree to, any Encumbrance (other than an Encumbrance in favour of the Noteholder) over; or

 

		(c)	attempt to do anything listed in clause 5.5(a) and 5.5(b) in respect of,

 

any of its assets, except in the ordinary course
of its ordinary business, without the prior written consent of the Noteholder.

 

		5.6	Provision of information and reports

 

The Guarantor must provide to the Noteholder the
following:

 

		(a)	documents issued: copies of all documents issued by it to holders of its Marketable Securities;

 

		(b)	Know your client: documentation and other evidence requested by the Noteholder which is required to satisfy or comply
with the ‘know your customer’, ‘know your client’ or ‘client vetting’ procedures of the Noteholder
or any potential assignee or any other person who is considering contracting with the Noteholder in connection with a Transaction
Document; and

 

		(c)	other information: any other information that the Noteholder requests in relation to it or any of its assets.

 

		5.7	Proper accounts

 

The Guarantor must keep accounting records that
give a true and fair view of the financial condition and state of affairs of it and its Subsidiaries.

 

		5.8	Notices to the Noteholder

 

The Guarantor must notify the Noteholder as soon
as it becomes aware of:

 

		(a)	any Event of Default occurring;

 

		(b)	any litigation, arbitration, administration or other proceeding in respect of it or any of its assets being commenced or threatened
that is if adversely determined would have or be likely to have a Material Adverse Effect;

 

		(c)	any Encumbrance or Guarantee, other than any Transaction Document, being created or entered into by the Guarantor or any Subsidiary
of the Guarantor; and

 

		(d)	any proposal of any Government Agency to compulsorily acquire any asset of the Guarantor or any Subsidiary of the Guarantor.

 

		5.9	Term of undertakings

 

Each of the Guarantor’s undertakings in this
clause 5 continues in full force and effect for the term of this deed.

 

    		page 14

     

    

 

 

		6	Indemnities

 

		6.1	General indemnity

 

		(a)	The Guarantor indemnifies the Noteholder against any Loss which the Noteholder pays, suffers, incurs or is liable for, in respect
of any of the following:

 

		(1)	the occurrence of any Event of Default;

 

		(2)	the Noteholder exercising its Powers consequent upon or arising out of the occurrence of any Event of Default;

 

		(3)	the non-exercise, attempted exercise, exercise or delay in exercising of any Power;

 

		(4)	any failure by the Debtor to pay any of the Guaranteed Moneys when due or in the manner or currency in which they were required
to be paid;

 

		(5)	any failure of the Debtor or the Guarantor or any other person to observe, perform or comply with any provision of any Transaction
Document or any other document or agreement;

 

		(6)	any fact or circumstance not being as represented or warranted to the Noteholder by the Debtor or the Guarantor or any Transaction
Party; and

 

		(7)	the Noteholder acting in connection with this deed or a Transaction Document in good faith on fax instructions purporting to
originate from the offices of the Guarantor or a Transaction Party or to be given by the Guarantor or the Transaction Party.

 

		(b)	The indemnity contained in clause 6.1(a) includes:

 

		(1)	the amount determined by the Noteholder as being incurred by reason of the liquidation or re-employment of deposits or other
funds acquired or contracted for by the Noteholder to fund or maintain the Guaranteed Moneys; and

 

		(2)	loss of margin.

 

		6.2	Indemnity for avoidance of Guaranteed Moneys

 

		(a)	If any of the Guaranteed Moneys (or moneys that would have been Guaranteed Moneys had they not been irrecoverable) are irrecoverable
by the Noteholder:

 

		(1)	from the Debtor; or

 

		(2)	from the Guarantor on the footing of a guarantee,

 

the Guarantor, as a separate and principal obligation:

 

		(3)	indemnifies the Noteholder against any Loss suffered, paid or incurred by the Noteholder in relation to the non-payment of
that money; and

 

		(4)	must pay the Noteholder an amount equal to that money.

 

		(b)	Clause 6.2(a) applies to the Guaranteed Moneys (or moneys that would have been Guaranteed Moneys had they not been irrecoverable)
that are or may be irrecoverable irrespective of whether:

 

		(1)	they are or may be irrecoverable by reason of any event described in clause 10.3;

 

    		page 15

     

    

  

 

		(2)	they are or may be irrecoverable by reason of any other fact or circumstance;

 

		(3)	the transactions or any of them relating to those moneys are void or illegal or avoided or otherwise unenforceable; and

 

		(4)	any matters relating to the Guaranteed Moneys are or should have been within the knowledge of the Noteholder.

 

		6.3	Foreign currency indemnity

 

If, at any time:

 

		(a)	the Noteholder receives or recovers any part of the Guaranteed Moneys or any amount payable by the Guarantor under this deed
including:

 

		(1)	under any judgment or order of any Government Agency;

 

		(2)	for any breach of any Transaction Document;

 

		(3)	on the liquidation of the Debtor, the Guarantor or any other person liable to pay the Guaranteed Moneys or any proof or claim
in that liquidation; or

 

		(4)	any other thing into which the obligations of the Guarantor, Debtor or other person liable to pay the Guaranteed Moneys may
have become merged, and

 

		(b)	the Payment Currency is not the Relevant Currency,

 

the Guarantor indemnifies the Noteholder against
any shortfall between the amount payable in the Relevant Currency and the amount actually received or recovered by the Noteholder
after the Payment Currency is converted or translated into the Relevant Currency in accordance with clause 6.4.

 

		6.4	Conversion of Currencies

 

The Noteholder may itself or through its bankers
purchase one currency with another, whether or not through an intermediate currency, whether spot or forward, in the manner and
amounts and at the times it thinks fit.

 

		6.5	Indemnity payment

 

The Guarantor must pay to the Noteholder upon demand
all amounts that the Noteholder states are owing to it under any indemnity under this deed.

 

		7	Tax,
                                         costs and expenses

 

		7.1	Tax

 

		(a)	The Guarantor must pay any Tax (other than an Excluded Tax) that is payable in respect of a Transaction Document (including
in respect of the execution, delivery, performance, release, discharge, amendment or enforcement of a Transaction Document).

 

		(b)	The Guarantor must pay any fine, penalty or other cost in respect of a failure to pay any Tax described in clause 7.1(a) except
to the extent that the fine, penalty or other cost is caused by the Noteholder’s failure to lodge moneys received from the
Guarantor within 5 Business Days before the due date for lodgment.

 

    		page 16

     

    

 

 

		(c)	The Guarantor indemnifies the Noteholder against any amount payable under clause 7.1(a) or clause 7.1(b).

 

		7.2	Costs and expenses

 

The Guarantor must pay to the Noteholder:

 

		(a)	all costs and expenses of the Noteholder in relation to the negotiation, preparation, execution, delivery, stamping, registration,
perfection, completion, variation and discharge of any Transaction Document or any Encumbrance provided for by a Transaction Document;

 

		(b)	all costs and expenses of the Noteholder in relation to the enforcement, protection or waiver, or attempted or contemplated
enforcement or protection, of any rights under any Transaction Document;

 

		(c)	all costs and expenses of the Noteholder in relation to the consent or approval of the Noteholder given under any Transaction
Document; and

 

		(d)	all costs and expenses of the Noteholder in relation to any enquiry by a Government Agency involving the Guarantor,

 

including:

 

		(e)	any administration costs of the Noteholder in connection with the matters described in clauses 7.2(b) and 7.2(d); and

 

		(f)	any legal costs and expenses and any professional consultant’s fees on a full indemnity basis.

 

		7.3	GST

 

		(a)	If GST is or will be imposed on a supply made under or in connection with this deed by the Noteholder, the Noteholder may,
to the extent that the consideration otherwise provided for that supply is not stated to include an amount in respect of GST on
the supply:

 

		(1)	increase the consideration otherwise provided for that supply under this deed by the amount of that GST; or

 

		(2)	otherwise recover from the recipient of the supply the amount of that GST.

 

		(b)	The Noteholder must issue a Tax Invoice to the recipient of the supply no later than 5 Business Days after payment to
the Noteholder of the GST inclusive consideration for that supply.

 

		8	Interest
                                         on overdue amounts

 

		8.1	Payment of interest

 

		(a)	Subject to clause 8.1(b), the Guarantor must pay interest:

 

		(1)	on any amount due and payable under this deed but unpaid; and

 

		(2)	on any interest payable under this clause 8.

 

    		page 17

     

    

 

 

		(b)	Clause 8.1(a) does not apply to any amount due under clause 2 where interest continues to be payable by the Debtor on the corresponding
part of the Guaranteed Moneys and accordingly forms part of the Guaranteed Moneys.

 

		8.2	Accrual of interest

 

The interest payable under clause 8.1:

 

		(a)	accrues from day to day from and including the due date for payment up to the actual date of payment, before and, as an additional
and independent obligation, after any judgment or other thing into which the liability to pay any amount under this deed becomes
merged; and

 

		(b)	may be capitalised by the Noteholder at monthly intervals.

 

		8.3	Rate of interest

 

The rate of interest payable under this clause 8
is the higher of:

 

		(a)	any rate specified in a Transaction Document; and

 

		(b)	the rate fixed or payable under a judgment, decree or order referred to in clause 8.2(a).

 

		9	Saving
                                         provisions

 

		9.1	No merger of security

 

		(a)	Nothing in this deed merges, extinguishes, postpones, lessens or otherwise prejudicially affects:

 

		(1)	any Encumbrance or indemnity in favour of the Noteholder; or

 

		(2)	any Power.

 

		(b)	No other Encumbrance or Transaction Document which the Noteholder has the benefit of in anyway prejudicially affects any Power.

 

		9.2	Exclusion of moratorium

 

To the extent not excluded by law, a provision of
any legislation that directly or indirectly:

 

		(a)	lessens, varies or affects in favour of the Guarantor any obligations under this deed or any Collateral Security;

 

		(b)	stays, postpones or otherwise prevents or prejudicially affects the exercise by the Noteholder of any Power; or

 

		(c)	confers any right on the Guarantor or imposes any obligation on the Noteholder or an Attorney in connection with the exercise
of any Power,

 

is negatived and excluded from this deed and any
Collateral Security and all relief and protection conferred on the Guarantor by or under that legislation is also negatived and
excluded.

 

    		page 18

     

    

  

 

		9.3	Exclusion of PPSA provisions

 

Without limiting clause 9.2, except as set forth
in the Australian Security Agreement and the Specific Security Agreement:

 

		(a)	the provisions of the PPSA specified in section 115(1) of that Act and (in the circumstances permitted under section 115(7)
of the PPSA) section 115(7) of that Act are excluded and will not apply to any PPSA Security Interest under this deed; and

 

		(b)	to the extent not prohibited by the PPSA, the Guarantor waives its right to receive any notice otherwise required to be given
by the Noteholders under section 157 (verification statements) or any other provision of the PPSA.

 

		9.4	Conflict

 

Where any right, power, authority, discretion or
remedy conferred on the Noteholder under this deed or any Collateral Security is inconsistent with the powers conferred by applicable
law then, to the extent not prohibited by that law, those powers conferred by applicable law are regarded as negatived or varied
to the extent of the inconsistency.

 

		9.5	Consent of Noteholder

 

		(a)	Whenever the doing of any thing by the Guarantor is dependent on the consent or approval of the Noteholder, the Noteholder
may withhold its consent or approval or give it conditionally or unconditionally in its absolute discretion unless expressly stated
otherwise in this deed.

 

		(b)	Any conditions imposed on the Guarantor by the Noteholder under clause 9.5(a) must be complied with by the Guarantor.

 

		9.6	Non-exercise of Guarantor’s rights

 

The Guarantor must not exercise any right it may
have (whether arising under this deed, any other Transaction Document or otherwise) inconsistent with this deed.

 

		9.7	Principal obligations

 

This deed and each Collateral Security is:

 

		(a)	a principal obligation and is not to be treated as ancillary or collateral to any other right or obligation; and

 

		(b)	independent of and unaffected by any other Collateral Security that the Noteholder may hold in respect of the Guaranteed Moneys
or any obligations of any Transaction Party or any other person.

 

		9.8	No obligation to marshal

 

The Noteholder is not required to marshal or to
enforce or apply under, appropriate, recover or exercise:

 

		(a)	any Encumbrance, Guarantee or Collateral Security or other document or agreement held, at any time, by the Noteholder; or

 

		(b)	any money or asset that the Noteholder, at any time, holds or is entitled to receive.

 

    		page 19

     

    

  

 

		9.9	Non avoidance

 

		(a)	If any payment, conveyance, transfer or other transaction relating to or affecting the Guaranteed Moneys is:

 

		(1)	void, voidable or unenforceable in whole or in part; or

 

		(2)	claimed to be void, voidable or unenforceable and that claim is upheld, conceded or compromised in whole or in part,

 

the liability of the Guarantor under this deed and
any Power is the same as if:

 

		(3)	that payment, conveyance, transfer or transaction (or the void, voidable or unenforceable part of it); and

 

		(4)	any release, settlement or discharge made in reliance on any thing referred to in clause 9.9(a)(3),

 

had not been made and the Guarantor must immediately
take all action and sign all documents necessary or required by the Noteholder to restore to the Noteholder this deed and any Encumbrance
held by the Noteholder immediately before the payment, conveyance, transfer or transaction.

 

		(b)	Clause 9.9(a) applies whether or not the Noteholder knew, or ought to have known, of anything referred to in clause 9.9(a).

 

		9.10	Continuing guarantee and indemnities

 

		(a)	The guarantee and each indemnity contained in this deed is a continuing obligation of the Guarantor, despite:

 

		(1)	any settlement of account; or

 

		(2)	the occurrence of any other thing,

 

and remains in full force and effect until:

 

		(3)	the Guaranteed Moneys and all other moneys owing, contingently or otherwise, under any of the Transaction Documents, have been
paid in full; and

 

		(4)	this deed has been finally discharged by the Noteholder.

 

		(b)	The guarantee and each indemnity contained in this deed is an additional, separate and independent obligation of the Guarantor
and neither the guarantee nor any indemnity limits the general nature of the guarantee or any other indemnity.

 

		(c)	The guarantee and each indemnity contained in this deed survives the termination of any Transaction Document.

 

		10	Third
                                         party provisions

 

		10.1	Suspense account

 

		(a)	The Noteholder may apply to the credit of a suspense account any:

 

		(1)	amounts received under this deed;

 

		(2)	dividends, distributions or other amounts received in respect of the Guaranteed Moneys in any liquidation; and

 

    		page 20

     

    

  

 

		(3)	other amounts received from the Guarantor, the Debtor, Transaction Party or any other person in respect of the Guaranteed Moneys.

 

		(b)	The Noteholder may retain the amounts in the suspense account for as long as it determines and is not obliged to apply them
in or towards satisfaction of the Guaranteed Moneys.

 

		(c)	The Noteholder may apply the amounts referred to in clause 10.1(b) in or towards satisfaction of the Guaranteed Moneys in such
manner as it determines.

 

		10.2	Independent obligations

 

This deed is enforceable against the Guarantor:

 

		(a)	without first having recourse to any Collateral Security;

 

		(b)	whether or not the Noteholder has:

 

		(1)	made demand on any Transaction Party other than the Guarantor (other than any demand specifically required to be given, or
notice required to be issued, to the Guarantor under clause 2.2 or any other provision of a Transaction Document);

 

		(2)	given notice to any Transaction Party (other than the Guarantor) or any other person in respect of any thing; or

 

		(3)	taken any other steps against any Transaction Party or any other person;

 

		(c)	whether or not any Guaranteed Moneys are then due and payable; and

 

		(d)	despite the occurrence of any event described in clause 10.3.

 

		10.3	Unconditional nature of obligations

 

		(a)	The Transaction Documents and the obligations of the Guarantor under the Transaction Documents are absolute, binding and unconditional
in all circumstances and are not released, discharged or otherwise affected by anything that but for this provision might have
that effect, including:

 

		(1)	the grant to any Transaction Party or any other person of any time, waiver, covenant not to sue or other indulgence;

 

		(2)	the release (including a release as part of any novation) or discharge of any Transaction Party or any other person;

 

		(3)	the cessation of the obligations, in whole or in part, of any Transaction Party or any other person under any Transaction Document
or any other document or agreement;

 

		(4)	the liquidation of the Noteholder or any Transaction Party or any other person;

 

		(5)	any arrangement, composition or compromise entered into by the Noteholder, any Transaction Party or any other person;

 

		(6)	any Transaction Document or any other document or agreement being in whole or in part illegal, void, voidable, avoided, unenforceable
or otherwise of limited force or effect;

 

    		page 21

     

    

 

  

		(7)	any extinguishment, failure, loss, release, discharge, abandonment, impairment, compounding, composition or compromise, in
whole or in part, of any Transaction Document or any other document or agreement;

 

		(8)	any Collateral Security being given to the Noteholder by any Transaction Party or any other person;

 

		(9)	any alteration, amendment, variation, supplement, renewal or replacement of any Transaction Document or any other document
or agreement or any increase in the limit or maximum principal amount available under such document;

 

		(10)	any moratorium or other suspension of any Power;

 

		(11)	the Noteholder exercising or enforcing, delaying or refraining from exercising or enforcing, or being not entitled or unable
to exercise or enforce, any Power;

 

		(12)	the Noteholder obtaining a judgment against any Transaction Party or any other person for the payment of any of the Guaranteed
Moneys;

 

		(13)	any transaction, agreement or arrangement that may take place with the Noteholder, any Transaction Party or any other person;

 

		(14)	any payment to the Noteholder, a Receiver or an Attorney, including any payment that at the payment date or at any time after
the payment date is, in whole or in part, illegal, void, voidable, avoided or unenforceable;

 

		(15)	any failure to give effective notice to any Transaction Party or any other person of any default under any Transaction Document
or any other document or agreement;

 

		(16)	any legal limitation, disability or incapacity of the Noteholder, or any Transaction Party or of any other person;

 

		(17)	any breach of any Transaction Document or any other document or agreement;

 

		(18)	the acceptance of the repudiation of, or termination of, any Transaction Document or any other document or agreement;

 

		(19)	any Guaranteed Moneys being irrecoverable for any reason;

 

		(20)	any disclaimer by any Transaction Party or any other person of any Transaction Document or any other document or agreement;

 

		(21)	any assignment, novation, assumption or transfer of, or other dealing with, any Powers or any other rights or obligations under
any Transaction Document or any other document or agreement;

 

		(22)	the opening of a new account of the Debtor (whether alone or with others) with the Noteholder or any transaction on or relating
to the new account;

 

		(23)	any prejudice (including material prejudice) to any person as a result of any thing done, or omitted by the Noteholder, any
Transaction Party or any other person;

 

		(24)	any prejudice (including material prejudice) to any person as a result of the Noteholder, Receiver, Attorney or any other person
selling or realising any property the subject of a Collateral Security at less than the best price;

 

    		page 22

     

    

  

 

		(25)	any prejudice (including material prejudice) to any person as a result of any failure or neglect by the Noteholder, Receiver,
Attorney or any other person to recover the Guaranteed Moneys from the Debtor or by the realisation of any property the subject
of a Collateral Security;

 

		(26)	any prejudice (including material prejudice) to any person as a result of any other thing;

 

		(27)	the receipt by the Noteholder of any dividend, distribution or other payment in respect of any liquidation;

 

		(28)	the capacity in which a Transaction Party executed a Transaction Document not being the capacity disclosed to the Noteholder
before the execution of the Transaction Document;

 

		(29)	the failure of any other Transaction Party or any other person to execute any Transaction Document or any other document; or

 

		(30)	any other act, omission, matter or thing whether negligent or not.

 

		(b)	Clause 10.3(a) applies irrespective of:

 

		(1)	the consent or knowledge or lack of consent or knowledge, of the Noteholder, any Transaction Party or any other person of any
event described in clause 10.3(a) (and the Guarantor irrevocably waives any duty on the part of the Noteholder to disclose such
information); or

 

		(2)	any rule of law or equity to the contrary.

 

		10.4	No competition

 

		(a)	Until the Guaranteed Moneys have been fully paid and this deed has been finally discharged, the Guarantor is not entitled to:

 

		(1)	be subrogated to the Noteholder;

 

		(2)	claim or receive the benefit of any Encumbrance, Guarantee (including any Transaction Document) or other document or agreement
of which the Noteholder has the benefit;

 

		(3)	claim or receive the benefit of any moneys held by the Noteholder;

 

		(4)	claim or receive the benefit of any Power;

 

		(5)	except in accordance with clause 10.4(b), either directly or indirectly prove in, claim or receive the benefit of any distribution,
dividend or payment arising out of or relating to the liquidation of the Debtor or any other person liable to pay the Guaranteed
Moneys;

 

		(6)	make a claim or exercise or enforce any right, power or remedy (including under an Encumbrance or Guarantee or by way of contribution)
against the Debtor or any other person liable to pay the Guaranteed Moneys or against any asset of the Debtor or any other person
liable to pay the Guaranteed Moneys, whether such right power or remedy arises under or in connection with this deed, any other
Transaction Document or otherwise;

 

		(7)	accept, procure the grant of, or allow to exist any Encumbrance in favour of the Guarantor from the Debtor or any other person
liable to pay the Guaranteed Moneys;

 

		(8)	exercise or attempt to exercise any right of set off against, nor realise any Encumbrance taken from, the Debtor or any other
person liable to pay the Guaranteed Moneys; or

 

    		page 23

     

    

  

 

		(9)	raise any defence or counterclaim in reduction or discharge of its obligations under the Transaction Documents.

 

		(b)	If required by the Noteholder, the Guarantor must prove in any liquidation of the Debtor or any other person liable to pay
the Guaranteed Moneys for all moneys owed to the Guarantor.

 

		(c)	All moneys recovered by the Guarantor from the Debtor or any other person liable to pay the Guaranteed Moneys from any liquidation
or under any Encumbrance (whether the Encumbrance is a Transaction Document or otherwise) must be paid to the Noteholder to the
extent of the unsatisfied liability of the Guarantor under the Transaction Documents.

 

		(d)	The Guarantor must not do, or seek, attempt or purport to do, any thing referred to in clause 10.4(a).

 

		11	General

 

		11.1	Confidential information

 

The Noteholder must not disclose to any person:

 

		(a)	this deed; or

 

		(b)	any information about any Transaction Party,

 

except:

 

		(c)	in connection with an actual or proposed permitted assignment, novation, participation or securitisation or entry by the Noteholder
into a credit default swap where the disclosure is made on the basis that the recipient of the information will comply with this
clause 11.1 in the same way that the Noteholder is required to do;

 

		(d)	to any professional or other adviser consulted by it in relation to any of its rights or obligations under the Transaction
Documents;

 

		(e)	to the Reserve Bank of Australia, the Australian Tax Office, the Australian Transaction Reports and Analysis Centre or any
Government Agency in Australia or elsewhere requiring or requesting disclosure of the information;

 

		(f)	in connection with the enforcement of its rights under this deed or the Transaction Documents;

 

		(g)	to any Related Body Corporate of the Noteholder where the disclosure is made on the basis that the recipient of the information
will comply with this clause 11.1 in the same way that the Noteholder is required to do;

 

		(h)	where the information is already in the public domain, or where the disclosure would not otherwise breach any duty of confidentiality;

 

		(i)	if required by law in Australia or elsewhere (other than under section 275 of the PPSA to the extent that disclosure would
not be required under that section if the disclosure would breach a duty of confidence); or

 

		(j)	otherwise with the prior written consent of the relevant Transaction Party (such consent not to be unreasonably withheld or
delayed).

 

    		page 24

     

    

 

 

		11.2	Guarantor to bear cost

 

Any thing that must be done by the Guarantor under
this deed, whether or not at the request of the Noteholder, is to be done at the cost of the Guarantor.

 

		11.3	Notices

 

		(a)	Any notice or other communication including any request, demand, consent or approval, to or by a party to this deed must be
in legible writing and in English addressed as shown below:

 

		(1)	if to the Guarantor:

 

	 	Address:	Level 8, 350 Collins Street, Melbourne, Australia.
	 	 	 
	 	Attention:	Keith Spickelmier and Andrew Adams
	 	 	 
	 	Email:	andrew@adamsmanagement.com.au:

        kspickelmier1@comcast.net and

        kim@discoveryenergy.com

	 	 	 
	 	if to the Noteholder:	 
	 	 	 
	 	Address:	DEC Funding LLC, c/o Avista Capital Partners, 1000 Louisiana Street, Suite 3700, Houston, Texas 77002
	 	 	 
	 	Attention:	Steven Webster
	 	 	 
	 	Email:	webster@avistacap.com
	 	 	 
	 	or as specified to the sender by the party by notice.

 

		(b)	If the sender is a company, any such notice or other communication must be signed by an Officer of the sender.

 

		(c)	Any such notice or other communication is regarded as being given by the sender and received by the addressee:

 

		(1)	if by delivery in person, when delivered to the addressee;

 

		(2)	if by post, on delivery to the addressee; or

 

		(3)	if by facsimile when received by the addressee in legible form,

 

but if the delivery or receipt is on a day that is
not a Business Day or is after 4.00pm (addressee’s time) it is regarded as received at 9.00am on the following Business Day.

 

		(d)	Any such notice or other communication can be relied upon by the addressee and the addressee is not liable to any other person
for any consequences of that reliance if the addressee believes it to be genuine, correct and authorised by the sender.

 

		(e)	A facsimile transmission is regarded as legible unless the addressee telephones the sender within 2 hours after the transmission
is received or regarded as received under clause 11.3(c)(3) and informs the sender that it is not legible.

 

		11.4	Governing law and jurisdiction

 

		(a)	This deed is governed by the laws of Victoria.

 

    		page 25

     

    

 

 

		(b)	The parties irrevocably submit to the non-exclusive jurisdiction of the courts of Victoria.

 

		(c)	The parties irrevocably waive any objection to the venue of any legal process on the basis that the process has been brought
in an inconvenient forum.

 

		(d)	The parties irrevocably waive any immunity in respect of its obligations under this deed that it may acquire from the jurisdiction
of any court or any legal process for any reason including the service of notice, attachment before judgment, attachment in aid
of execution or execution.

 

		11.5	Prohibition and enforceability

 

		(a)	Any provision of, or the application of any provision of, this deed or any Power that is prohibited in any jurisdiction is,
in that jurisdiction, ineffective only to the extent of that prohibition.

 

		(b)	Any provision of, or the application of any provision of, this deed that is void, illegal or unenforceable in any jurisdiction
does not affect the validity, legality or enforceability of that provision in any other jurisdiction or of the remaining provisions
in that or any other jurisdiction.

 

		11.6	Waivers

 

		(a)	Waiver of any right arising from a breach of this deed or of any Power arising upon default under this deed or upon the occurrence
of an Event of Default must be in writing and signed by the party granting the waiver.

 

		(b)	A failure or delay in exercise, or partial exercise, of:

 

		(1)	a right arising from a breach of this deed or the occurrence of an Event of Default; or

 

		(2)	a Power created or arising upon default under this deed or upon the occurrence of an Event of Default,
	 	 	 
	 	does not result in a waiver of that right or Power.

 

		(c)	A party is not entitled to rely on a delay in the exercise or non-exercise of a right or Power arising from a breach of this
deed or on a default under this deed or on the occurrence of an Event of Default as constituting a waiver of that right or Power.

 

		(d)	A party may not rely on any conduct of another party as a defence to exercise of a right or Power by that other party.

 

		(e)	This clause 11.6 may not itself be waived except by writing.

 

		11.7	Variation

 

A variation of any term of this deed must be in
writing and signed by the parties.

 

		11.8	Cumulative rights

 

The Powers in this deed are cumulative and do not
exclude any other right, power, authority, discretion or remedy of the Noteholder.

 

    		page 26

     

    

 

 

		11.9	Assignment

 

		(a)	Subject to any Transaction Document, the Noteholder may assign its rights under this deed or any Transaction Document without
the consent of the Guarantor.

 

		(b)	The Guarantor may not assign any of its rights under this deed or any other Transaction Document without the prior written
consent of the Noteholder.

 

		11.10	Counterparts

 

		(a)	This deed may be executed in any number of counterparts.

 

		(b)	All counterparts, taken together, constitute one instrument.

 

		(c)	A party may execute this deed by signing any counterpart.

 

		11.11	Attorneys

 

Each of the attorneys executing this deed states
that the attorney has no notice of the revocation of the power of attorney appointing that attorney.

 

    		page 27

     

    

 

 

Signing page

 

	 	Executed as a deed
	 	 
	 	Guarantor
	 	 
	 	
        Signed sealed and delivered by

        Discovery Energy SA Pty Ltd

        by

	 	 
	sign here ►	/s/ William E. Begley	 
	 	Company Secretary/Director	 
	 	 	 
	print name	 	 
	 	 	 
	sign here ►	/s/ Michael D. Dahlke	 
	 	Director	 
	 	 	 
	print name	 	 
	 
	 

 

	 	Noteholder
	 	 
	 	
        Signed sealed and delivered by

        DEC Funding LLC

        by

	 	 
	sign here ►	/s/ Steven Webster	 
	 	Director	 
	 	 	 
	print name	 	 

 

    		page 28

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