SEC Contract Filing

Filing Date: 2015-03-18

Document Content:
<DOCUMENT>
<TYPE>EX-10.5
<SEQUENCE>7
<FILENAME>v404616_ex10-5.htm
<DESCRIPTION>EXHIBIT 10.5
<TEXT>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: right"><B>Exhibit 10.5</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: right">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: right">Execution Version</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B>Reference is made to the Intercreditor Agreement
described below. Each Secured Party, by accepting the benefits of the security provided hereby, (i) consents (or is deemed to consent),
to the subordination of Liens provided for in the Intercreditor Agreement, (ii) agrees (or is deemed to agree) that it will be
bound by, and will take no actions contrary to, the provisions of the Intercreditor Agreement, (iii) authorizes (or is deemed to
authorize) the Collateral Trustee on behalf of such Person to enter into, and perform under, the Intercreditor Agreement and (iv)
acknowledges (or is deemed to acknowledge) that a copy of the Intercreditor Agreement was delivered, or made available, to such
Secured Party<FONT STYLE="font-family: Times New Roman, Times, Serif; text-transform: uppercase">. </FONT></B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-transform: uppercase; text-align: justify"><B><U>Notwithstanding
any other provision contained herein, this Security Agreement, the Liens created hereby and the rights, remedies, duties and obligations
provided for herein are subject in all respects to the provisions of the Intercreditor Agreement. In the event of any conflict
or inconsistency between the provisions of this Security Agreement and the Intercreditor Agreement, the provisions of the Intercreditor
Agreement shall control.</U></B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-transform: uppercase; text-align: center"><U>SECOND LIEN SECURITY
AGREEMENT</U></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">This SECOND LIEN SECURITY
AGREEMENT, dated as of March 12, 2015 (as amended, supplemented, amended and restated or otherwise modified from time to time,
this &ldquo;<U>Security Agreement</U>&rdquo;), is made by ENERGY XXI USA, INC., a Delaware corporation (the &ldquo;<U>Grantor</U>&rdquo;),
in favor of U.S. Bank National Association, in its capacity as Collateral Trustee (as defined in the Indenture hereinafter described)
for the ratable benefit of the Secured Parties.</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><U>WITNESSETH</U> :</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">A.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Energy
XXI Gulf Coast, Inc., a Delaware corporation (the &ldquo;<U>Company</U>&rdquo;), will issue its 11.000% Senior Secured Second Lien
Notes due 2020 in an initial aggregate principal amount of $1,450,000,000, pursuant to an Indenture dated as of the date hereof
(as amended, supplemented, amended and restated or otherwise modified from time to time, the &ldquo;<U>Indenture</U>&rdquo;) by
and among the Company, <FONT STYLE="font-family: Times New Roman, Times, Serif">Energy XXI Ltd</FONT>, the Grantor, the Subsidiary
Guarantors party thereto from time to time, and U.S. Bank National Association, as the Trustee (as defined therein).</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">B.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Indenture requires the Grantor to enter into this Security Agreement and grant to the Collateral Trustee, for the ratable benefit
of the Secured Parties, a security interest in the Collateral (as hereinafter defined).</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">C.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
connection with the Indenture, the Company, the Guarantors (including the Grantor), the Trustee and the Collateral Trustee are
entering into that certain Collateral Trust Agreement dated as of the date hereof (as amended, supplemented, amended and restated
or otherwise modified from time to time, the &ldquo;<U>Collateral Trust Agreement</U>&rdquo;), which <FONT STYLE="font-family: Times New Roman, Times, Serif">sets
forth the terms on which the Collateral Trustee will receive, hold, administer, maintain, enforce and distribute the proceeds of
all liens upon any property of the Grantor at any time held by the Collateral Trustee, in trust for the benefit of the current
and future holders of the Parity Lien Obligations (as defined in the Indenture), including the Secured Parties</FONT>.</P>

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