Common use of Properties and Assets Clause in Contracts

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries own and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except for properties and assets disposed of in the ordinary course of business or as would not reasonably be expected to have a Royale Material Adverse Effectpermitted by this Agreement, the Royale Parties Buyer or one of its Subsidiaries has good, valid, and their Subsidiaries own and have either good and valid marketable title in fee or a to, valid leasehold interest, Right of Way interests in or other otherwise legally enforceable rights to use all of the landpersonal property, mineral and other subsurface rightsassets (tangible or intangible), buildingsused, structures occupied, and other improvements thereon and fixtures thereto necessary to permit operated or held for use by it to conduct in connection with its business as currently conducted, presently conducted in each case case, free and clear of any Lien, except for (i) statutory Liens for amounts not yet delinquent and (ii) Liens incurred in the ordinary course of business or imperfections of title, easements, and encumbrances, if any, that, individually and in the aggregate, are not material in character, amount or extent, and do not materially detract from the value and do not materially interfere with the present use, occupancy, or operation of any material asset. (b) Buyer or one of its Subsidiaries (a) has good record, insurable and marketable title to all real property (by name and location) owned by Buyer or any of its Subsidiaries (the “Buyer Owned Real Property”), free and clear of all material Liens, except for Permitted Liens. Buyer (or its applicable Subsidiary) has an existing owner’s title insurance policy for each property constituting the Buyer Owned Real Property insuring said owner’s title to such property free and clear of all liens except ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and has disclosed such policies to Company prior to the date hereof. No portion of the Buyer Owned Real Property is subject to any right of first offer or right of first refusal or any other option to purchase said Buyer Owned Real Property. (except in all cases for Permitted Liens). Except as would not reasonably be expected c) Neither Buyer nor any of its Subsidiaries has received a written notice of, and otherwise has no Knowledge of any, material default with respect to have a Royale Material Effect, all any of the leases, Rights of Way subleases, licenses or other agreements entered into by Buyer (the “Buyer Leases”) under which Buyer uses or occupies or has the right to use or occupy, now or in the future, real property (the “Buyer Leased Real Property,” and together with the Buyer Owned Real Property, the “Buyer Real Property”) is valid, binding, and in full force and effect and neither Buyer nor any Royale Party of its Subsidiaries has received a written notice of, and otherwise has no Knowledge of any, material default or termination with respect to any Buyer Lease. There has not occurred any event and no condition exists that would constitute a termination event or a material breach by Buyer or any of their its Subsidiaries leaseof, access or use material default by Buyer or any of its Subsidiaries in, the performance of any covenant, agreement, or condition contained in any Buyer Lease, and to Buyer’s Knowledge, no lessor under a Buyer Lease is in material breach or default in the performance of any material covenant, agreement, or condition contained in such Buyer Lease, and Buyer (or its applicable Subsidiary) has not received written notice from any landlord alleging any of the foregoing. To Buyer’s Knowledge, there is no pending or threatened in writing legal, administrative, arbitral or other proceeding, claim, action, or governmental or regulatory investigation of any nature with respect to the Buyer Real Property, including without limitation a pending or threatened taking of any real property by eminent domain. Buyer and each of its Subsidiaries has paid all rents and other charges to the extent due under the Buyer Leases. To Buyer’s Knowledge, there are no material pending or threatened condemnation proceedings against any Buyer Real Property. The Buyer Leases constitute all leases in which Buyer and its Subsidiaries has any interest in as lessee, sublessee or sub-licensee in any real property. The Buyer Leases are legal, valid, binding and are in force and effect against the Royale Parties upon Buyer (or any of their Subsidiaries its Subsidiary, as applicable) and, to the Knowledge of each Royale PartyBuyer, the counterparties all other parties thereto, in accordance with their respective termsenforceable, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and similar laws of general applicability relating to or affecting creditors’ rights or by general principles of equity, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party full force and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which effect and have not had and would not reasonably be expected to have a Royale Material Adverse Effectbeen modified or amended. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any To each of the Rights Buyer Leases, Buyer (or its applicable Subsidiary) has not exercised or given any notice of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder exercise of any such Rights option, right of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned first offer or operated by the Royale Parties and their Subsidiaries are subject to Rights right of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time first refusal contained in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure SchedulesBuyer Leases, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under including any such Contractoption or right pertaining to purchase, expansion, renewal, extension or relocation (collectively, “Buyer Lease Options”). Buyer (or its applicable Subsidiary) has the full right to exercise any Buyer Lease Options contained in the Buyer Leases on the terms and conditions contained therein and upon due exercise would be entitled to enjoy the full benefit of such options with respect thereto. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries own and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇w▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇w▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇w▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇S▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇h▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇h▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Each Subject Company has a valid and enforceable leasehold interest in each of the leased premises in which it currently conducts its business, except as may be affected by bankruptcy, insolvency, reorganization, moratorium and other similar laws relating to or affecting creditors’ rights generally or general equitable principles. Section 2.12(a) of the Seller Disclosure Letter identifies, as of the date hereof, all of the leases for real property to which each Subject Company is a party (the “Leases”). Except as set forth in Section 2.12(a) of the Disclosure Letter, the Leases constitute all real property owned, leased, subleased, licensed or otherwise used in the operation of the Business. The Sellers have previously provided or otherwise made available to Apollo true, complete and correct copies of such Leases. As of the date hereof, except as would not reasonably be expected to have have, individually or in the aggregate, be Material to a Royale Material Adverse EffectReasonable Investor, there is no default by the lessee or, to the Sellers’ Knowledge, the Royale Parties lessor under any such lease and their Subsidiaries to the Sellers’ Knowledge the use and operation of the property subject to the Leases does not violate any Applicable Law. Except as may be affected by bankruptcy, insolvency, reorganization, moratorium and other similar laws relating to or affecting creditors’ rights generally or general equitable principles, (i) each Lease is the legal, valid and binding obligation of the Subject Company party thereto and, to the Knowledge of the Sellers, each other party to such Lease and (ii) each Lease is enforceable against such Subject Company and, to the Knowledge of the Sellers, each other party to such Lease. No Subject Company owns any real property. (b) Except as set forth in Section 2.12(a) of the Disclosure Letter, the Subject Companies own and have either (and as of the Closing, shall own and have) good, valid and marketable title to or, in the case of leased property, good and valid title in fee leasehold interests in, or a valid leasehold interestotherwise have (and as of the Closing, Right of Way shall have) full or other sufficient and legally enforceable rights to use, all of the landproperties, mineral assets and other subsurface rightsrights (tangible or intangible, buildingsand real, structures personal or mixed) used or held for use in connection with, necessary for the conduct of, or otherwise material to the operations of, the Business as it is conducted as of the date hereof and other improvements thereon and fixtures thereto necessary as it will be conducted immediately prior to permit it to conduct its business as currently conductedthe Closing, in each case free and clear of all liens (except in all cases for any Lien other than Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any failure to have any such preferential purchasetitle, consent interest or similar rights right that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedulesnot, none of the Royale Interests are subject to any Tax partnership agreement individually or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherlandaggregate, ▇▇▇▇▇▇ & Associatesbe Material to a Reasonable Investor. The Subject Companies have maintained in all material respects all tangible assets in good repair, Inc. as of December 31working order and operating condition, 2015subject only to ordinary wear and tear, and dated February 1except for any failure to be in good repair, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedulesworking order or operating condition that would not, no Royale Party is engaged in any oil, natural gas individually or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepaymentaggregate, advance payment, take-or-pay or similar obligations without then or thereafter being entitled be Material to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securitiesa Reasonable Investor. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Neither the Company nor any of its Subsidiaries owns, or has ever owned, any real property. (b) None of the Company Leases has been assigned by the Company or a Subsidiary in favour of any person. The current uses of each property subject to a Company Lease comply with applicable Law. Except as would disclosed in Section 14(b) of the Company Disclosure Letter, no consent is required nor is any notice required to be given under any Company Lease by any party thereto or any other person in connection with the completion of the Transactions in order to maintain all rights of the Company or a Subsidiary, as the case may be, under such Company Lease. The completion of the Transactions will not reasonably be expected afford any party to have any of the Company Leases or any other person the right to terminate any Company Lease nor will the completion of such transactions result in any additional or more onerous obligation on the Company or a Royale Material Adverse EffectSubsidiary, as the Royale Parties case may be, under any Company Lease. (c) The machinery, equipment, furniture, fixtures and other tangible personal property and assets owned, leased or used by the Company or any of its Subsidiaries (the “Assets”) are in good operating condition and repair, ordinary wear and tear excepted, in the aggregate, sufficient and adequate to carry on their respective businesses in all material respects as presently conducted or over the last twelve months prior to the date hereof, and the Company and its Subsidiaries own are in possession of and have either good and valid title in fee to, or a valid leasehold interestinterests in or valid rights under contract to use, Right of Way or other rights such Assets that are material to the landCompany and its Subsidiaries, mineral and other subsurface rightstaken as a whole, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way Permitted Liens and defects in title that, individually or in the absence of which have aggregate, are not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party be material to the Company and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of WaySubsidiaries, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising taken as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effectwhole. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Partnership Material Adverse Effect, the Royale Parties Partnership or a Subsidiary of the Partnership each respectively owns and their Subsidiaries own and have has either good and valid title in fee or a valid leasehold interest, Right of Way (defined below) or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Partnership Material Effect, all leases, Rights of Way or other agreements under which any Royale Party the Partnership or any of their its Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties Partnership or any of their its Subsidiaries and, to the Knowledge of each Royale Partythe Partnership, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties Partnership nor any of their its Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party of the Partnership and its Subsidiaries has such consents, easements, rights of way, permits and licenses (collectively, “Rights of Way Way”) from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Partnership Material Adverse Effect. Each Royale Party of the Partnership and its Subsidiaries has fulfilled and performed all its material obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Partnership Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries Partnership are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that materially affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party the Partnership, Matrix Operator, Matrix or any of their its Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Partnership Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Partnership Material Adverse Effect, the Royale Parties Partnership and their its Subsidiaries, as applicable, have defensible title to all of the Royale Property Interests forming the basis for the reserves reflected in the Royale Audited Financial Statements except for such Royale Property Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Partnership Material Adverse Effect or as set forth on Section 5.10(c4.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Property Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or or, preferential rights to purchase Hydrocarbons and neither the Royale Parties Partnership nor any of their its Subsidiaries are not is obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Partnership Material Adverse Effect, the Royale Parties Partnership and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Property Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇w▇▇▇▇ owned, leased, operated or used by the Royale Parties Partnership and their its Subsidiaries and all water, carbon dioxide or injection ▇w▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties Partnership and their its Subsidiaries or otherwise associated with the Royale Property Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇w▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Partnership Material Adverse Effect. No well owned, leased, operated or used by any Royale Party the Partnership or any of their its Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Property Interests operated by the Royale Parties Partnership and their its Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Partnership Material Adverse Effect. None of the Interests of the Royale Parties Partnership or their its Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Partnership Material Adverse Effect. Except as set forth on Section 5.10(e4.10(e) of Royale Disclosure Schedules, none of the Royale Property Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report Summary Projection of Netherland, ▇▇▇▇▇▇ & Associates, Inc. Reserves and Revenues as of December March 31, 20152016, and dated February 1of the Partnership, with run date June 10, 2016, a correct and complete copy of which the Partnership has made available to Royale prior to the date of this Agreement. (g) Except as set forth on Section 5.10(g4.10(g) of the Royale Disclosure Schedules, no Royale Party the Partnership is not engaged in any oil, natural gas or other futures or option options trading in respect of which it has any material future liability, nor is any Royale Party it a party to any price swaps, ▇h▇▇▇▇▇, futures or similar instruments. Section 5.10(g4.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party the Partnership for the delivery of Hydrocarbons attributable to any of the Royale Property Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g4.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party the Partnership is not bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h4.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Partythe Partnership, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties Partnership or any of their its Subsidiaries within one year of the Royale Merger Effective Time Closing Date in any of the Royale Property Interests or any of the contracts governing any of the Royale Property Interests. (i) Except as set forth on Section 5.10(i4.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Property Interests contain any minimum volume or throughput provisions or require the Royale Parties Partnership or any of their its Subsidiaries to pay for services regardless of whether the Royale Parties Partnership or any of their its Subsidiaries deliver delivers such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j4.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Property Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇h▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Property Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i4.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Partnership Material Adverse Effect, the Royale Parties Partnership or a Subsidiary of the Partnership each respectively owns and their Subsidiaries own and have has either good and valid title in fee or a valid leasehold interest, Right of Way (defined below) or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Partnership Material Effect, all leases, Rights of Way or other agreements under which any Royale Party the Partnership or any of their its Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties Partnership or any of their its Subsidiaries and, to the Knowledge of each Royale Partythe Partnership, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties Partnership nor any of their its Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party of the Partnership and its Subsidiaries has such consents, easements, rights of way, permits and licenses (collectively, “Rights of Way Way”) from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Partnership Material Adverse Effect. Each Royale Party of the Partnership and its Subsidiaries has fulfilled and performed all its material obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Partnership Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries Partnership are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that materially affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party the Partnership, Matrix Operator, Matrix or any of their its Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Partnership Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Partnership Material Adverse Effect, the Royale Parties Partnership and their its Subsidiaries, as applicable, have defensible title to all of the Royale Property Interests forming the basis for the reserves reflected in the Royale Audited Financial Statements except for such Royale Property Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Partnership Material Adverse Effect or as set forth on Section 5.10(c4.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Property Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or or, preferential rights to purchase Hydrocarbons and neither the Royale Parties Partnership nor any of their its Subsidiaries are not is obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Partnership Material Adverse Effect, the Royale Parties Partnership and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Property Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties Partnership and their its Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties Partnership and their its Subsidiaries or otherwise associated with the Royale Property Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Partnership Material Adverse Effect. No well owned, leased, operated or used by any Royale Party the Partnership or any of their its Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Property Interests operated by the Royale Parties Partnership and their its Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Partnership Material Adverse Effect. None of the Interests of the Royale Parties Partnership or their its Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Partnership Material Adverse Effect. Except as set forth on Section 5.10(e4.10(e) of Royale Disclosure Schedules, none of the Royale Property Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report Summary Projection of Netherland, ▇▇▇▇▇▇ & Associates, Inc. Reserves and Revenues as of December March 31, 20152016, and dated February 1of the Partnership, with run date June 10, 2016, a correct and complete copy of which the Partnership has made available to Royale prior to the date of this Agreement. (g) Except as set forth on Section 5.10(g4.10(g) of the Royale Disclosure Schedules, no Royale Party the Partnership is not engaged in any oil, natural gas or other futures or option options trading in respect of which it has any material future liability, nor is any Royale Party it a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g4.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party the Partnership for the delivery of Hydrocarbons attributable to any of the Royale Property Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g4.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party the Partnership is not bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h4.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Partythe Partnership, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties Partnership or any of their its Subsidiaries within one year of the Royale Merger Effective Time Closing Date in any of the Royale Property Interests or any of the contracts governing any of the Royale Property Interests. (i) Except as set forth on Section 5.10(i4.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Property Interests contain any minimum volume or throughput provisions or require the Royale Parties Partnership or any of their its Subsidiaries to pay for services regardless of whether the Royale Parties Partnership or any of their its Subsidiaries deliver delivers such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j4.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Property Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Property Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i4.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected The Company or one of the Company Subsidiaries have, and immediately following the Effective Time will continue to have a Royale Material Adverse Effecthave, the Royale Parties and their Subsidiaries own and have either good and valid title in fee to, or a valid leasehold interestinterest in, Right of Way or other rights a valid right under Contract to use, all the land, mineral properties and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business assets reflected in the latest audited balance sheet included in the Company SEC Reports as currently conductedbeing owned by the Company or such Company Subsidiary or acquired after the date thereof, in each case free and clear of all liens that are material to the Company’s business on a consolidated basis (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out properties sold or otherwise disposed of since December 31, 2015, the date thereof in the ordinary course of business), free and clear of all liens and Production Burdens Liens other than Production Burdens not yet earned, due or payable and Permitted Liens Liens. (other than Production Burdens)b) Neither the Company nor any of the Company Subsidiaries owns any real property. Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c3.19(b) of the Royale Company Disclosure SchedulesLetter contains a true, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, correct and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedulescomplete list, as of the date hereofAgreement Date, no Royale Party is bound by futuresof all of the existing leases, hedgesubleases, swap, collar, put, call, floor, cap, option licenses or other Contracts that are intended agreements pursuant to benefit from, relate to which the Company or reduce any Company Subsidiary uses or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbonsoccupies, or securities. has the right to use or occupy any real property, in each case involving payments in excess of $250,000 per annum (h) Except as provided each property, a “Leased Real Property” and the agreements relating there to, the “Leases”). With respect to each Lease listed or required to be listed in Section 5.10(h3.19(b) of the Royale Company Disclosure SchedulesLetter: (A) to the Knowledge of the Company, there are no mandatory drilling or completion obligations and there are no pending or, disputes with respect to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except Lease, except as set forth in Section 5.10(j) of the Royale Disclosure Scheduleswould not, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole individually or in partthe aggregate, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is reasonably be expected to result in a mandatory payment material liability to the Company and the Company Subsidiaries, taken as a whole; and (B) the Company or expenditure not otherwise disclosed in Section 5.10(i) one of the Royale Disclosure SchedulesCompany Subsidiaries that is either the tenant or licensee named under the Lease has a good and valid leasehold interest in each parcel of real property which is subject to a Lease and is in possession of the properties purported to be leased or licensed thereunder, except in each case as would not, individually or in the aggregate, reasonably be expected to result in a material liability to the Company or any of the Company Subsidiaries.

Properties and Assets. (a) Except as would not not, individually or in the aggregate, reasonably be expected to have a Royale Material Adverse EffectEffect on Acquiror, the Royale Parties and their Subsidiaries own and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party Acquiror and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had good and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Oil and Gas Interests forming the basis for the reserves reflected in the Royale Financial Statements Acquiror Reserve Reports as attributable to interests owned by Acquiror and its Subsidiaries, except for such Royale Oil and Gas Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, 2013 in the ordinary course of business, free and clear of all liens Liens other than Permitted Liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not not, individually or in the aggregate, reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure SchedulesAcquiror, (i) each Oil and Gas Lease to which Acquiror or any of its Subsidiaries is a party is valid and in full force and effect, (ii) none of Acquiror or any of its Subsidiaries has violated any provision of, or taken or failed to take any act which, with or without notice, lapse of time, or both, would constitute a default under the provisions of such Oil and Gas Lease, and (iii) none of Acquiror or any of its Subsidiaries has received written notice from the other party to any such Oil and Gas Lease that Acquiror or any of its Subsidiaries, as the case may be, has breached, violated or defaulted under any Oil and Gas Lease. (b) Except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on Acquiror, (i) either Acquiror or a Subsidiary of Acquiror has good and valid title to each real property (and each real property at which operations of Acquiror or any of its Subsidiaries are conducted) owned by Acquiror or any Subsidiary (but excluding the Oil and Gas Interests) (such owned property collectively, the “Acquiror Owned Real Property”) and (ii) either Acquiror or a Subsidiary of Acquiror has a good and valid leasehold interest in each lease, sublease and other agreement under which Acquiror or any of its Subsidiaries uses or occupies or has the right to use or occupy any real property (or real property at which operations of Acquiror or any of its Subsidiaries are conducted) (but excluding the Oil and Gas Interests) (such property subject to a lease, sublease or other agreement, the “Acquiror Leased Real Property” and such leases, subleases and other agreements are, collectively, the “Acquiror Real Property Leases”), in each case, free and clear of all Liens other than any Permitted Liens, and other than any conditions, encroachments, easements, rights-of-way, restrictions and other encumbrances that do not adversely affect the existing use of the real property subject thereto by the owner (or lessee to the extent a leased property) thereof in the operation of its business. Except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on Acquiror, (A) each Acquiror Real Property Lease is valid, binding and in full force and effect and (B) no uncured default of a material nature on the part of Acquiror or, if applicable, its Subsidiary or, to Acquiror’s knowledge, the landlord thereunder, exists under any Acquiror Real Property Lease, and no event has occurred or circumstance exists which, with the giving of notice, the passage of time, or both, would constitute a material breach or default under a Acquiror Real Property Lease. (c) Except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on Acquiror, (i) there are no leases, subleases, licenses, options, rights or other agreements affecting any portion of the Acquiror Owned Real Property or the Acquiror Leased Real Property that would reasonably be expected to adversely affect the existing use of such Acquiror Owned Real Property or the Acquiror Leased Real Property by Acquiror or its Subsidiaries in the operation of its business thereon, and (ii) neither Acquiror nor any of its Subsidiaries is currently subleasing, licensing or otherwise granting any person the right to use or occupy a material portion of a Acquiror Owned Real Property or Acquiror Leased Real Property that would reasonably be expected to adversely affect the existing use of such Acquiror Owned Real Property or Acquiror Leased Real Property by Acquiror or its Subsidiaries in the operation of its business thereon. (d) Except as would not be material to Acquiror and its Subsidiaries, taken as a whole, all proceeds from the sale of Hydrocarbons produced from the Royale Oil and Gas Interests of Acquiror and its Subsidiaries are being received by them in any producing well a timely manner and are not being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (reason other than gas balancing arrangements), except awaiting preparation and approval of division order title opinions for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statementsrecently drilled ▇▇▇▇▇. (de) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide CO2 or injection ▇▇▇▇▇ located on any property owned, leased, operated the Oil and Gas Leases or used by the Royale Parties Units of Acquiror and their its Subsidiaries or otherwise associated with the Royale Interests an Oil and Gas Interest of Acquiror or its Subsidiaries have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights Oil and Gas Contracts and applicable Law, and all drilling and completion (and plugging and abandonment) of the ▇▇▇▇▇ and such other ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not not, individually or in the aggregate, reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties Effect on allowables because of overproduction or violation of any applicable LawAcquiror. (ef) All Royale Oil and Gas Interests operated by the Royale Parties Acquiror and their its Subsidiaries have been operated in accordance with reasonable, prudent oil and gas field practices and in compliance with the applicable ContractsOil and Gas Leases and applicable Law, except where the failure to so operate would not not, individually or in the aggregate, reasonably be expected to have a Royale Material Adverse Effect. Effect on Acquiror. (g) None of the material Oil and Gas Interests of the Royale Parties Acquiror or their its Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactionstransactions contemplated by this Agreement, except for any such preferential purchase, consent or similar rights that would not not, individually or in the aggregate, reasonably be expected to have a Royale Material Adverse Effect. Except as set forth Effect on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax ReturnAcquiror. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as set forth on Schedule 2.17(a) of the Company Disclosure Schedule, other than properties and assets disposed of by the Company and the Company Subsidiary in the ordinary course of business since the Most Recent Balance Sheet Date, the Company and the Company Subsidiary have good and valid title to all of their respective material properties, interests in properties and assets, real and personal, reflected on the Most Recent Balance Sheet or acquired since the Most Recent Balance Sheet Date, or, in the case of material leased properties and assets, valid leasehold interests in such properties and assets, in each case free and clean of all Liens, except in each case in this Section 2.17(a) as would not reasonably be expected to have a Royale Company Material Adverse Effect, . (b) Schedule 2.17(b) of the Royale Parties Company Disclosure Schedule sets forth a complete and their Subsidiaries own and have either good and valid title in fee correct list of each parcel of real property owned or leased by the Company or the Company Subsidiary (the leases pursuant to which the Company or the Company Subsidiary is a valid leasehold interest, Right tenant of Way or other rights any such real property being hereinafter referred to as the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens“Leases”). Except As of the date of this Agreement, except as would not reasonably be expected to have a Royale Company Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and Adverse Effect (i) the Leases are in full force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither (ii) the Royale Parties nor Company is not in default of any of their Subsidiaries its obligations under the Leases and (iii) to the Company’s knowledge, the landlords under the Leases are not in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of landlords’ obligations under the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse EffectLeases. (c) Except as would not reasonably be expected to have a Royale Company Material Adverse Effect, the Royale Parties facilities, property and their Subsidiariesequipment owned, as applicableleased or otherwise used by the Company or the Company Subsidiary are in a good state of maintenance and repair, have defensible title free from material defects and in good operating condition (subject to all of the Royale Interests forming the basis normal wear and tear), and suitable for the reserves reflected in the Royale Financial Statements except purposes for such Royale Interests sold, which they are presently used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens . (other than Production Burdens). d) Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Company Material Adverse Effect, the Royale Parties tangible assets owned or leased by the Company and each applicable Subsidiary (A) the Company Subsidiary, together with its intangible assets, are in compliance with all valuation agreements, adequate to conduct the business and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms operations of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice Company and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure SchedulesCompany Subsidiary as currently conducted.

Properties and Assets. Schedule 3.16 of the Seller Disclosure Schedule contains an accurate description (aby subject leased real and immovable property, name of lessor, date of lease and term expiration date) Except as would not reasonably be expected of each real or immovable property lease, sublease or installment purchase arrangement to have which Sellers are a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries own and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights party relating to the landBusiness; and a list of all fixed assets used in the Business. No Seller owns any real property relating to the Business. Except for (1) items reflected in the Financial Statements, mineral (2) exceptions to title that do not interfere materially with Sellers’ use and other subsurface rightsenjoyment of owned or leased real or immovable property, buildings(3) Permitted Exceptions, structures (4) properties and other improvements thereon assets sold or transferred in the ordinary course of business consistent with past practices since the Balance Sheet Date, and fixtures thereto necessary (5) items listed on Schedule 3.16 of the Seller Disclosure Schedule, Sellers have good title to permit it to conduct its business the assets relating the Business or reflected as currently conducted, owned by them in each case the Financial Statements or acquired after the Balance Sheet Date free and clear of all liens (except in all cases for Permitted Liens)liabilities, obligations and Encumbrances. Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way ▇▇▇▇▇.▇▇▇ or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties theretosuch ▇▇▇▇▇.▇▇▇ Subsidiary, in accordance each case where it is a lessee, has the right under valid and subsisting leases to occupy, use and possess all property leased by it in connection with their respective termsthe Business, and neither the Royale Parties nor any of their Subsidiaries are in default there has not occurred under any such leaseslease any material breach, Rights of Way violation or other agreementsdefault by ▇▇▇▇▇. (b) Each Royale Party ▇▇▇ or such ▇▇▇▇▇.▇▇▇ Subsidiary, and its Subsidiaries ▇▇▇▇▇.▇▇▇ or such ▇▇▇▇▇.▇▇▇ Subsidiary has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations experienced any material uninsured damage or destruction with respect to such Rights of Way and conducts their business in a manner that does not violate any of properties since the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse EffectBalance Sheet Date. All pipelines owned or operated properties and assets used by Sellers in connection with the Royale Parties Business are in good operating condition and their Subsidiaries are repair (subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the ordinary wear and tear) suitable for immediate use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free the Business and clear comply in all material respects with all Requirements of Laws relating thereto now in effect. Sellers enjoy peaceful and undisturbed possession under all leases for the use of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected property relating to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) the Business under which any of them is the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reasonlessee, and (ii) there all leases to which any Seller is a party are no calls on production or preferential rights to purchase Hydrocarbons valid and the Royale Parties nor any binding obligations of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreementsSeller, and settlement agreements with respect to Production Burdensthe Knowledge of Sellers, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royaltyrespective third parties thereto, Tax or similar paymentenforceable, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effectterms thereof. None of the Interests of the Royale Parties or their Subsidiaries is subject Sellers are in material default with respect to any preferential purchasesuch lease, consent and there has occurred no default by any Sellers or similar right event that with the lapse of time or the giving of notice, or both, would become operative as constitute a result of the Transactions, except for material default under any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effectlease. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report Requirements of NetherlandLaws, ▇▇▇▇▇▇ & Associatesconditions of record, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of impediments, which it has interfere with the actual use by any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, Seller of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreementproperty leased, or (iv) occupied by it in connection with the Business. All leases of premises from which the Business is expected to result conducted and which are located in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure SchedulesAustralia are registered.

Properties and Assets. (a) Except as would not reasonably be expected Parent or one of the Parent Subsidiaries have, and immediately following the Effective Time will continue to have a Royale Material Adverse Effecthave, the Royale Parties good, valid and their Subsidiaries own and have either good and valid marketable title in fee to, or a valid leasehold interestinterest in, Right of Way or other rights a valid right under Contract to use, all the land, mineral properties and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business assets reflected in the latest audited balance sheet included in the Parent Public Reports as currently conductedbeing owned by Parent or such Parent Subsidiary or acquired after the date thereof, in each case free and clear of all liens that are material to Parent’s business on a consolidated basis (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out properties sold or otherwise disposed of since December 31, 2015, the date thereof in the ordinary course of business), free and clear of all liens and Production Burdens Liens other than Production Burdens not yet earned, due or payable and Permitted Liens Liens. (other than Production Burdens)b) Neither Parent nor any of the Parent Subsidiaries owns any real property. Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c4.21(b) of the Royale Parent Disclosure Schedules, Letter contains (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reasona true, correct and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedulescomplete list, as of the date hereofAgreement Date, no Royale Party is bound by futuresof all of the existing leases, hedgesubleases, swap, collar, put, call, floor, cap, option licenses or other Contracts that are intended agreements pursuant to benefit from, relate to which Parent or reduce any Parent Subsidiary uses or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbonsoccupies, or securities. has the right to use or occupy any real property, in each case involving payments in excess of $250,000 per annum (h) Except as provided each property, a “Parent Leased Real Property” and the agreements relating there to, the “Parent Leases”). With respect to each Parent Lease listed or required to be listed in Section 5.10(h4.21(b) of the Royale Parent Disclosure SchedulesLetter: (A) to the Knowledge of Parent, there are no mandatory drilling or completion obligations and there are no pending or, disputes with respect to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except Parent Lease, except as set forth in Section 5.10(j) of the Royale Disclosure Scheduleswould not, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole individually or in partthe aggregate, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is reasonably be expected to result in a mandatory payment material liability to Parent and the Parent Subsidiaries, taken as a whole; and (B) Parent or expenditure not otherwise disclosed in Section 5.10(i) one of the Royale Disclosure SchedulesParent Subsidiaries that is either the tenant or licensee named under the Parent Lease has a good and valid leasehold interest in each parcel of real property which is subject to a Parent Lease and is in possession of the properties purported to be leased or licensed thereunder, except in each case as would not, individually or in the aggregate, reasonably be expected to result in a material liability to Parent or any of the Parent Subsidiaries.

Properties and Assets. (a) Except insofar as would not have, or reasonably be expected to have have, a Royale CERA Material Adverse Effect, the Royale Parties each of CERA LP and their Subsidiaries own and have either CERA Inc. has good and valid title to, or otherwise has sufficient and legally enforceable right to use, all of the properties and assets (real, personal or mixed, tangible or intangible, including Intellectual Property), used or held for use in fee connection with, necessary for the conduct of, or a valid leasehold interestotherwise material to, Right the businesses conducted by it (the "CERA Assets"). Except as set forth in Section 2.1.7(a) of Way the CERA Disclosure Letter, the CERA Assets that are owned by CERA Inc. or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case CERA LP are owned free and clear of all any Liens other than (i) liens for Taxes not yet due and payable or that are being contested in good faith and by appropriate proceedings, (except ii) statutory liens incurred in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effectthe ordinary course of business that, all leasesindividually and in the aggregate, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale CERA Material Adverse Effect, and (iii) encumbrances and easements that do not materially detract from the value or materially interfere with the use of the properties affected thereby (the exceptions described in the foregoing clauses (i), (ii) and (iii) being referred to as "Permitted CERA Liens"). (b) Neither CERA Inc. nor CERA LP owns any real property. Each Royale Party Section 2.1.7(b) of the CERA Disclosure Letter contains a complete and its Subsidiaries has fulfilled correct list of all real property leases, subleases and performed all its obligations occupancy agreements to which either CERA LP or CERA Inc. is a party (each, a "CERA Lease") setting forth the address, landlord and tenant for each CERA Lease. CERA Inc. and CERA LP have delivered to MGI and the Parent correct and complete copies of the CERA Leases. Except insofar as would not have, or reasonably be expected to have, a CERA Material Adverse Effect, (i) each CERA Lease, other than the CERA Lease with respect to CERA LP's principal offices in Cambridge, Massachusetts, is legal, valid, binding, in full force and effect and enforceable against CERA Inc. or CERA LP, as the case may be, and, to the knowledge of any Stockholder, GS LP, CERA Inc. or CERA LP, against the other parties thereto, (ii) neither CERA LP nor CERA Inc. is in default, violation or breach under any such Rights of Way and conducts their business in a manner that does not violate any of the Rights of WayCERA Lease, and no event has occurred and is continuing that allowsconstitutes or, or after with notice or lapse the passage of time or both, would allowconstitute a default, revocation violation or termination thereof breach under any such CERA Lease and (iii) each such CERA Lease grants the tenant under such CERA Lease the right to use and occupy the premises and rights demised and intended to be demised thereunder, which right is sufficient for the purposes for which such premises and rights are or would result are contemplated to be used or occupied by such tenant. The CERA Lease with respect to CERA LP's principal offices in Cambridge, Massachusetts (the "CERA Headquarters Lease") is legal, valid, binding, in full force and effect and enforceable against CERA Inc. or CERA LP, as the case may be, and, to the knowledge of any Stockholder, GS LP, CERA Inc. or CERA LP, the other parties thereto. Neither CERA LP nor CERA Inc. is in default, violation or breach in any impairment material respect under the CERA Headquarters Lease, and no event has occurred and is continuing that constitutes or, with notice or the passage of time or both, would constitute a default, violation or breach under the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments CERA Headquarters Lease that have not had and would not reasonably be expected to have a Royale CERA Material Adverse Effect. All pipelines owned or operated by The CERA Headquarters Lease grants the Royale Parties tenant thereunder the right to use and their Subsidiaries are subject occupy the premises and rights demised and intended to Rights of Waybe demised thereunder, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis which right is sufficient for the reserves reflected in the Royale Financial Statements except purposes for which such Royale Interests sold, used, farmed out premises and rights are or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due are contemplated to be used or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered occupied by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statementstenant. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Material Adverse EffectSection 3.15(a) of the Company Disclosure Letter sets forth the address of each parcel of real property owned by the Company or its Subsidiaries (collectively, the Royale Parties and their "Owned Real Property"). The Company or one of its Subsidiaries own and have either has good and valid marketable title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral Owned Real Property and other subsurface rights, to all of the buildings, structures and other improvements thereon and fixtures thereto necessary except to permit it the extent that not having such title would not, individually or in the aggregate, be reasonably expected to materially interfere with its ability to conduct its business as presently conducted. Neither the Company nor any of its Subsidiaries has leased, licensed or otherwise granted any Person the right to use or occupy the Owned Real Property. Neither the Company nor any of its Subsidiaries has collaterally assigned or granted any other security interest in the Owned Real Property, except (i) to the extent that such collateral assignment or grant would not, individually or in the aggregate, be reasonably expected to materially interfere with its ability to conduct its business as presently conducted or (ii) in connection with any Lien to be released at or prior to the Effective Time. (b) Section 3.15(b) of the Company Disclosure Letter sets forth the address of each parcel of all leasehold or subleasehold estates and other rights to use or occupy any land, buildings, structures, improvements, fixture or other interest in real property held by or for the Company or its Subsidiaries (the "Leased Real Property"). Section 3.15(b) of the Company Disclosure Letter sets forth all sublicenses, licenses and other grants by the Company or any of its Subsidiaries to any person of the right to use or occupy such Leased Real Property or any portion thereof involving, in any such case, payments of more than $750,000 annually. (c) The Company and each of its Subsidiaries has such good and valid title to, or such valid rights by lease, license, other agreement or otherwise to use, all assets and properties (other than the Owned Real Property which is the subject of the representation contained in Section 3.15(a) hereof) (in each case, tangible and intangible) necessary to enable the Company and its Subsidiaries to conduct their business as currently conducted, except defects in each case free title, easements, restrictive covenants and clear of all liens (except similar encumbrances that, individually or in all cases for Permitted Liens). Except as the aggregate, would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance materially interfere with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient ability to conduct its business as currently presently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except Schedule 2.12(a) sets forth a true, complete and correct list of all real property owned by the Company or any of its Subsidiaries (including any real property subject to (i) an installment sale contract pursuant to which the Company or any of its Subsidiaries will acquire fee simple title to the applicable real property upon compliance with the terms of such installment sale contract or (ii) a lease between the Company, as would not reasonably tenant, and a governmental agency, as landlord, in connection with bond financing pursuant to which the Company has an option to purchase the applicable real property and which lease may be expected to have terminated by the Company, as tenant, upon payment of the bonds (a Royale Material Adverse Effect“Bond Lease”)) (which real property, together with all appurtenances thereto, all Improvements thereon and all fixtures affixed thereto, collectively, the Royale Parties “Owned Real Property”) and their all real property leased by the Company and any of its Subsidiaries own (which real property, together with all appurtenances thereto, all Improvements thereon and all fixtures affixed thereto, collectively, the “Leased Real Property”). The Company and each of its Subsidiaries, respectively, have either (x) good and valid fee simple title (subject only to Permitted Liens or the terms of the applicable installment sale contract or Bond Lease) to all of the Owned Real Property and good and valid title (subject only to Permitted Liens or the terms of the applicable installment sale contract or Bond Lease) to all inventories, furnishings, fixtures, vehicles, equipment, machinery, supplies and all other tangible personal property and Assets physically located at, or used in fee connection with, the Owned Real Property (other than the Leased Personalty) (collectively, the “Owned Personalty”), all of which is reflected on the Balance Sheet or a which has been acquired since the Balance Sheet Date, and (y) valid and insurable leasehold interestinterests and estates in the Leased Real Property and good and valid title (subject only to Permitted Liens) to all inventories, Right furnishings, fixtures, vehicles, equipment, machinery, supplies and all other tangible personal property and Assets physically located at, or used in connection with, the Leased Real Property (other than the Leased Personalty) (collectively, the “Other Personalty” and together with the Owned Personalty, collectively, the “Personalty”), all of Way which is reflected on the Balance Sheet or other rights which has been acquired since the Balance Sheet Date. The Company and the Subsidiaries hold title to the land, mineral Owned Real Property and other subsurface rights, buildings, structures the Personalty and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conductedleasehold estates in the Leased Real Property which are, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of businesscase, free and clear of all liens Liens except for: (1) Liens consisting of zoning or planning restrictions, easements, agreements, rights-of-way, covenants, permits and Production Burdens other than Production Burdens restrictions or limitations on the use of real property or irregularities in title thereto appearing of record provided they do not materially impair the use of such property as it is presently used in the Ordinary Course of Business; (2) Liens for current Taxes not yet earneddue and payable or which are being contested in good faith and for which appropriate reserves in accordance with GAAP have been created; (3) mechanic’s, materialmen’s and similar Liens arising in the Ordinary Course of Business (including by operation of Law) which are not yet due and payable or payable which are being contested in good faith and Permitted Liens for which appropriate reserves in accordance with GAAP have been created; (other than Production Burdens). Except 4) standard exceptions which would be contained in an ALTA Form extended coverage owner’s policy of title insurance (or the locally available form of title insurance policy, as applicable) relating to (A) laws, ordinances and governmental regulations, (B) police power and (C) eminent domain, in each instance, to the extent the same would not reasonably be expected constitute a material breach of the other representations made by the Company under this Agreement; (5) any Liens granted pursuant to have a Royale Material Adverse Effect or as permitted under the Credit Facility and the Notes (including Liens for after-acquired collateral); and (6) any Liens set forth on Section 5.10(cSchedule 2.12(a)(6) hereto (collectively, the “Permitted Liens”). (b) True and correct copies of all of the Royale Disclosure Schedulesleases for the Leased Real Property have been made available to Buyer by the Company via its virtual data room (collectively, (i) none the “Leases”). The Leases, together with the Personalty Leases, constitute all leases, subleases or other occupancy agreements to which the Company and its Subsidiaries are a party. Each of the proceeds from Company and its Subsidiaries other than the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reasonDesignated Subsidiaries, and to the knowledge of the Company each of the Designated Subsidiaries, is in compliance in all material respects with the terms of all Leases to which each is a party, respectively, and all such Leases are valid and enforceable in all material respects in accordance with their terms. Neither the Company nor any of its Subsidiaries has received any notice (iiwritten or oral) from any landlord under any Lease alleging that the Company or any of its Subsidiaries is in default or in breach of any such Lease and to the knowledge of the Company, the landlords under the Leases are in compliance in all material respects with their obligations under the Leases. (c) Neither the Company nor its Subsidiaries has received written notice of a pending proceeding in eminent domain or other similar proceedings affecting any Owned Real Property or Leased Real Property and, to the Company’s knowledge, there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statementsthreatened proceedings. (d) All The Owned Real Property and the Leased Real Property include all the real property and Improvements necessary and sufficient to enable the Company and its Subsidiaries to conduct the Business operations of the ▇▇▇▇▇ owned, leased, operated or used by Company and its Subsidiaries in the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, same manner as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effectcurrently conducted. Except as set forth on Section 5.10(e) Schedule 2.6, the Company and its Subsidiaries have not sold or disposed of Royale Disclosure Schedulesany Assets since September 7, none 2007 except sales of inventory in the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax ReturnOrdinary Course of Business. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (je) Except as set forth in Section 5.10(jthe FM Global Risk Reports (which the Company has made available to the Buyer and Merger Sub via its virtual data room), the improvements located on each parcel of Owned Real Property and Leased Real Property (collectively, the “Improvements”) are generally in good working order and repair, ordinary wear and tear excepted, and no material repairs, replacements or regularly scheduled maintenance relating to such Personalty has been deferred (with materiality for this purpose to be determined based on the scope of operations conducted at such location). All water, gas, electrical, steam, compressed air, telecommunication, sanitary and storm sewage lines and systems and other similar systems serving each parcel of Owned Real Property and Leased Real Property are installed and operating and are sufficient to enable the Improvements thereon to continue to be used and operated in the manner currently being used and operated and to permit the conduct of the Royale Disclosure Schedules, none Businesses of the Contracts relating Company and the Subsidiaries as currently conducted. (f) The Personalty and Leased Personalty constitute all personal property necessary and sufficient to conduct the Business operations of the Company and its Subsidiaries in the same manner as currently conducted. (g) The Company or its Subsidiaries have good and valid leasehold title and interest to all Personalty which is leased to the Royale Interests Company or its Subsidiaries (including “Leased Personalty”), free and clear of any and all oilLiens, gas other than Permitted Liens. Each of the Company and mineral its Subsidiaries is in compliance in all material respects with the terms of all leases for Leased Personalty (“Personalty Leases”) to which each is a party, respectively, and similar Contractsall such Personalty Leases are valid and enforceable in all material respects in accordance with their terms. Neither the Company nor any of its Subsidiaries has received any notice (oral or written) contain from any provision (i) requiring lessor under a Personalty Lease alleging the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas Company or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting any of its Subsidiaries is in a loss, in whole default or in part, breach of any such Personalty Lease and to the knowledge of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to Company the consummation of lessors under the transactions of Personalty Leases are in compliance in all material respects with their obligations under the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure SchedulesPersonalty Leases.

Properties and Assets. (a) Except The Company has good and valid title to, or a valid leasehold interest in, all the properties and assets which it purports to own or lease (real, tangible, personal and mixed), including all the properties and assets reflected in the Company Balance Sheet (except for personal property sold since the Company Balance Sheet Date in the ordinary course of business consistent with past practice). All properties and assets reflected in the Company Balance Sheet are free and clear of all Liens. (b) Section 4.21 of the Company Disclosure Schedule sets forth a true, complete and correct list of all real property owned, leased, subleased or licensed by the Company and the location of such premises. All material real property leases, licenses or other occupancy agreements to which the Company is a party (collectively, the “Company Real Property Leases”) are either filed as exhibits to the Company SEC Reports or complete copies thereof have been delivered to or made available to Parent. Section 4.21 of the Company Disclosure Schedule lists all Company Real Property Leases other than the Company Real Property Leases that are listed as an exhibit to the Company 10-K or a subsequent quarterly report on Form 10-Q. (i) All Company Real Property Leases are in full force and effect (except as such enforceability may be subject to Laws of general application relating to bankruptcy, insolvency and the relief of debtors and rules of Law governing specific performance, injunctive relief or other equitable remedies), (ii) there is no existing default by the Company under any of the Company Real Property Leases, except such defaults as have been waived in writing, (iii) no event has occurred with respect to the Company which, with notice or lapse of time or both, would constitute a default of any of the Company Real Property Leases, and (iv) to the Company’s Knowledge, there are no defaults of any obligations of any party other than the Company under any Company Real Property Lease, except in the cases of clauses (i) through (iv) for such defaults as would not reasonably be expected to have a Royale Material Adverse Effecthave, the Royale Parties and their Subsidiaries own and have either good and valid title in fee individually or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have aggregate, a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial StatementsCompany. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties The Company and their each of its Subsidiaries own and have either has (i) good and valid title to all of the material properties and assets reflected as owned on the most recent balance sheet of the Company contained in fee or a valid leasehold interestthe Company SEC Documents, Right of Way or other rights and to the landknowledge of the Company, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens any material Liens other than Permitted Liens, except for properties or assets that have been sold or disposed of in the ordinary course of business consistent with past practice since the date of such balance sheet and (except ii) a valid leasehold interest or other comparable Contract of use in all cases for material properties and assets (in each case, tangible or intangible) reflected as leased on such balance sheet, and to the knowledge of the Company, free and clear of any material Liens other than Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights except for such leases or comparable Contracts terminated in the ordinary course of Way or other agreements under which any Royale Party or any business consistent with past practice since the date of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreementsbalance sheet. (b) Each Royale Party The Company Disclosure Letter sets forth (i) a true and its Subsidiaries has such Rights complete list of Way from all real property leased, subleased or otherwise occupied by the Company or any Company Subsidiary (collectively, the “Leased Real Property”), (ii) the address for each person as are sufficient parcel of Leased Real Property, (iii) a description of the applicable Contract relating thereto and (iv) the current rent amounts payable by the Company or any Company Subsidiary related to conduct its business as currently conductedeach Leased Real Property. No Lease Agreement is subject to any Lien entered into by the Company or any Company Subsidiary, except for such Rights including without limitation any right to the use or occupancy of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effectany Leased Real Property, other than Permitted Liens. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations Lease Agreement is, with respect to such Rights of Way the Company or the applicable Company Subsidiary, a valid and conducts their business subsisting agreement in full force and effect and constitutes a manner that does not violate any valid and binding obligation of the Rights of WayCompany or the applicable Company Subsidiary, subject to applicable bankruptcy, insolvency, reorganization, moratorium or similar Laws, now or hereafter in effect, affecting creditors’ rights generally, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effectgeneral equity principles. (c) Except as would not reasonably be expected Each parcel of Leased Real Property is, to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all knowledge of the Royale Interests forming Company or the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015applicable Company Subsidiary, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in material compliance with all valuation agreementsexisting material Laws applicable to such Leased Real Property, and settlement agreements neither the Company nor any Company Subsidiary has received written notice from any Governmental Entity regarding non-compliance with respect to Production Burdenssuch Laws. Neither the Company nor any Company Subsidiary has received written notice of any proceedings in eminent domain, and (B) have paid condemnation or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts proceedings that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ ownedpending, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending orsuch proceedings threatened in writing, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf affecting any portion of the Royale Parties or Leased Real Property and neither the Company nor any of their Subsidiaries within one year Company Subsidiary has received written notice of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, existence of any of the Royale Interests for lessee’s failure to pay royalties outstanding writ, injunction, decree, order or for lessee’s breach judgment or of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedulespending proceeding.

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Material Adverse Effect, Neither the Royale Parties and their Subsidiaries own and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties Company nor any of their its Subsidiaries are in default under owns, or has ever owned, any such leases, Rights of Way or other agreementsreal property. (b) Each Royale Party and its Subsidiaries None of the Company Leases has been assigned by the Company or a Subsidiary in favour of any person. The current uses of each property subject to a Company Lease comply with Law. Except as disclosed in Section 14(b) of the Company Disclosure Letter, no consent is required nor is any notice required to be given under any Company Lease by any party thereto or any other person in connection with the completion of the Transactions in order to maintain all rights of the Company or a Subsidiary, as the case may be, under such Rights Company Lease. The completion of Way from each person as are sufficient the Transactions will not afford any party to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights Company Leases or any other person the right to terminate any Company Lease nor will the completion of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would such transactions result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned additional or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances more onerous obligation on the Rights of Way that affect Company or a Subsidiary, as the use thereof and there are no gaps (including case may be, under any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse EffectCompany Lease. (c) Except as would not reasonably be expected to have a Royale Material Adverse EffectThe machinery, equipment, furniture, fixtures and other tangible personal property and assets owned, leased or used by the Royale Parties Company or any of its Subsidiaries (the “Assets”) are in good operating condition and their Subsidiariesrepair, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015ordinary wear and tear excepted, in the ordinary course aggregate, sufficient and adequate to carry on their respective businesses in all material respects as presently conducted or over the last twelve months prior to the date hereof, and the Company and its Subsidiaries are in possession of businessand have good title to, or valid leasehold interests in or valid rights under contract to use, such Assets that are material to the Company and its Subsidiaries, taken as a whole, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements)Liens, except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial StatementsPermitted Liens. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except Other than the properties and assets disposed of by Parent and its Subsidiaries in the ordinary course of business since the Parent’s Most Recent Balance Sheet Date, Parent and its Subsidiaries have good and valid title to or, with respect to leased property, valid leasehold interests in, all of their respective properties, interests in material properties and assets, real and personal, in each case free and clear of Liens, except in each case in this Section 4.17 as would not reasonably be expected to have a Royale Parent Material Adverse Effect, . (b) Section 4.17(b) of the Royale Parties Parent Disclosure Schedule sets forth a complete and their correct list of each parcel of real property owned or leased by the Parent or any of its Subsidiaries own and have either good and valid title in fee (the “Parent Leased Facilities,” with the leases pursuant to which the Parent or any of its Subsidiaries is a valid leasehold interest, Right tenant of Way or other rights any such Parent Leased Facility being hereinafter referred to as the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens“Parent Leases”). Except As of the date of this Agreement, except as would not reasonably be expected to have a Royale Parent Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and Adverse Effect (i) the Parent Leases are in full force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither (ii) the Royale Parties nor Parent is not in default of any of their Subsidiaries its obligations under the Parent Leases and (iii) to the Parent’s knowledge, the landlords under the Leases are not in default of the landlords’ obligations under the Parent Leases. The Parent has not been in default of any of its obligations under any Parent Lease on more than three occasions in the twelve months preceding the date of this Agreement. No event has occurred or circumstance exists which, with the delivery of notice, the passage of time or both, would constitute such leasesa breach or default, Rights or permit the termination, modification or acceleration of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate rent under any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse EffectParent Leases. (c) Except as would not reasonably be expected to have a Royale Parent Material Adverse Effect, the Royale Parties all personal property and their Subsidiariesequipment owned, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out leased or otherwise disposed used by the Parent or any of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, its Subsidiaries (i) none are in a good state of maintenance and repair, free from material defects and in good operating condition (subject to normal wear and tear), (ii) comply with the proceeds from the sale of Hydrocarbons produced from the Royale Interests applicable Parent Leases and with all applicable Laws in any producing well are being held in suspense for any reasonall material respects, and (iiiii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except suitable for the rights of any lessor to take free gas under the terms of any applicable lease purposes for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) which they are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statementspresently used. (d) All of To the ▇▇▇▇▇ ownedParent’s knowledge, leasedthere is no condemnation, operated expropriation or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide appropriation proceeding pending or injection ▇▇▇▇▇ located on threatened against any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party Parent Leased Facility or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Lawthe improvements thereon. (e) All Royale Interests True and correct copies of the documents under which the Parent Leased Facilities are leased or subleased to or utilized and/or operated by the Royale Parties Company and their its Subsidiaries (the “Parent Lease Documents”) have heretofore been operated in accordance with reasonable, prudent field practices delivered or made available to Company. The Parent Lease Documents are unmodified and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Returnfull force and effect. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not not, individually or in the aggregate, reasonably be expected to have a Royale Material Adverse EffectEffect on Company, the Royale Parties and their Subsidiaries own and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party Company and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had good and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Oil and Gas Interests forming the basis for the reserves reflected in the Royale Financial Statements Company Reserve Reports as attributable to interests owned by Company and its Subsidiaries, except for such Royale Oil and Gas Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, 2013 in the ordinary course of business, free and clear of all liens Liens other than Permitted Liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not not, individually or in the aggregate, reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure SchedulesCompany, (i) each Oil and Gas Lease to which Company or any of its Subsidiaries is a party is valid and in full force and effect, (ii) none of Company or any of its Subsidiaries has violated any provision of, or taken or failed to take any act which, with or without notice, lapse of time, or both, would constitute a default under the provisions of such Oil and Gas Lease, and (iii) none of Company or any of its Subsidiaries has received written notice from the other party to any such Oil and Gas Lease that Company or any of its Subsidiaries, as the case may be, has breached, violated or defaulted under any Oil and Gas Lease. (b) Except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on Company, (i) either Company or a Subsidiary of Company has good and valid title to each real property (and each real property at which operations of Company or any of its Subsidiaries are conducted) owned by Company or any Subsidiary (but excluding the Oil and Gas Interests) (such owned property collectively, the “Company Owned Real Property”) and (ii) either Company or a Subsidiary of Company has a good and valid leasehold interest in each lease, sublease and other agreement under which Company or any of its Subsidiaries uses or occupies or has the right to use or occupy any real property (or real property at which operations of Company or any of its Subsidiaries are conducted) (but excluding the Oil and Gas Interests) (such property subject to a lease, sublease or other agreement, the “Company Leased Real Property” and such leases, subleases and other agreements are, collectively, the “Company Real Property Leases”), in each case, free and clear of all Liens other than any Permitted Liens, and other than any conditions, encroachments, easements, rights-of-way, restrictions and other encumbrances that do not adversely affect the existing use of the real property subject thereto by the owner (or lessee to the extent a leased property) thereof in the operation of its business. Except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on Company, (A) each Company Real Property Lease is valid, binding and in full force and effect and (B) no uncured default of a material nature on the part of the Company or, if applicable, its Subsidiary or, to the Company’s knowledge, the landlord thereunder, exists under any Company Real Property Lease, and no event has occurred or circumstance exists which, with the giving of notice, the passage of time, or both, would constitute a material breach or default under a Company Real Property Lease. (c) Except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on Company, (i) there are no leases, subleases, licenses, rights or other agreements affecting any portion of the Company Owned Real Property or the Company Leased Real Property that would reasonably be expected to adversely affect the existing use of such Company Owned Real Property or the Company Leased Real Property by Company or its Subsidiaries in the operation of its business thereon, (ii) except for such arrangements solely among the Company and its Subsidiaries or among Company’s Subsidiaries, there are no outstanding options or rights of first refusal in favor of any other party to purchase any Company Owned Real Property or any portion thereof or interest therein that would reasonably be expected to adversely affect the existing use of the Company Owned Real Property by the Company in the operation of its business thereon, and (iii) neither Company nor any of its Subsidiaries is currently subleasing, licensing or otherwise granting any person the right to use or occupy a material portion of a Company Owned Real Property or Company Leased Real Property that would reasonably be expected to adversely affect the existing use of such Company Owned Real Property or Company Leased Real Property by the Company or its Subsidiaries in the operation of its business thereon. (d) Except as would not be material to Company and its Subsidiaries, taken as a whole, all proceeds from the sale of Hydrocarbons produced from the Royale Oil and Gas Interests of Company and its Subsidiaries are being received by them in any producing well a timely manner and are not being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (reason other than gas balancing arrangements), except awaiting preparation and approval of division order title opinions for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statementsrecently drilled ▇▇▇▇▇. (de) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide CO2 or injection ▇▇▇▇▇ located on any property owned, leased, operated the Oil and Gas Leases or used by the Royale Parties Units of Company and their its Subsidiaries or otherwise associated with the Royale Interests an Oil and Gas Interest of Company or its Subsidiaries have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights Oil and Gas Contracts and applicable Law, and all drilling and completion (and plugging and abandonment) of the ▇▇▇▇▇ and such other ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not not, individually or in the aggregate, reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties Effect on allowables because of overproduction or violation of any applicable LawCompany. (ef) All Royale Oil and Gas Interests operated by the Royale Parties Company and their its Subsidiaries have been operated in accordance with reasonable, prudent oil and gas field practices and in compliance with the applicable ContractsOil and Gas Leases and applicable Law, except where the failure to so operate would not not, individually or in the aggregate, reasonably be expected to have a Royale Material Adverse Effect. Effect on Company. (g) None of the material Oil and Gas Interests of the Royale Parties Company or their its Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactionstransactions contemplated by this Agreement, except for any such preferential purchase, consent or similar rights that would not not, individually or in the aggregate, reasonably be expected to have a Royale Material Adverse Effect. Except as set forth Effect on Section 5.10(eCompany. (h) of Royale Disclosure Schedules, none None of the Royale Oil and Gas Interests of Company or its Subsidiaries are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report Return to be filed under Subchapter K of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as Chapter 1 of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) Subtitle A of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securitiesCode. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not The Company and its Subsidiaries have good record and marketable fee title to all real Property and all other Property and assets, whether tangible or intangible, owned by them and reasonably be expected to have a Royale Material Adverse Effectnecessary in the conduct of business of the Company or such Subsidiaries. All of the leases necessary in any material respect for the operation of their respective properties and assets, the Royale Parties and their Subsidiaries own and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party the Company or any of their its Subsidiaries leaseholds any Property or assets, access real or use any real property personal, are valid, binding subsisting and are in force enforceable and effect against afford peaceful and undisturbed possession of the Royale Parties subject matter of the lease, and no material default by the Company or any of their its Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor exists under any of their the provisions thereof. All buildings, machinery and equipment of the Company and its Subsidiaries are in default under any good repair and working order, except for ordinary wear and tear. All material current and proposed uses of such leases, Rights Property of Way or other agreements. (b) Each Royale Party the Company and its Subsidiaries has as set forth in the Company SEC Documents and the Information Memorandum are permitted as of right and no such Rights Law interferes with such current or proposed uses. To the knowledge of Way from each person as are sufficient to conduct its business as currently conductedthe Company, except for there is no pending or formally proposed change in any such Rights of Way the absence of Laws, which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party Effect on the Company and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in on a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effectconsolidated basis. Except as set forth on Section 5.10(e) of Royale Disclosure SchedulesSchedule 5.21, none no condemnation proceeding is pending or, to the knowledge of the Royale Interests are subject to Company, threatened against the Company or any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) its Subsidiaries. All Property of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of Company and its Subsidiaries are free from all Liens except for (i) Liens which it has any material future liability, nor is any Royale Party would not have a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(gMaterial Adverse Effect on the Company and its Subsidiaries on a consolidated basis; (ii) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future Liens disclosed on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value thereforSchedule 5.21 hereto; and (iii) Permitted Liens. Except as set forth on Section 5.10(g) Schedule 5.21 hereto and except as entered into pursuant to the Transaction Documents neither the Company nor any of the Royale Disclosure Schedulesits Subsidiaries has signed any material financing statement, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option debtor or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbonslessee, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, any security agreement authorizing any secured party thereunder to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under file any such Contractfinancing statement. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as set forth on Schedule 2.17(a) of the Company Disclosure Schedule, other than properties and assets disposed of by the Company and the Company Subsidiary in the ordinary course of business since the Most Recent Balance Sheet Date, the Company and the Company Subsidiary have good and valid title to all of their respective material properties, interests in properties and assets, real and personal, reflected on the Most Recent Balance Sheet or acquired since the Most Recent Balance Sheet Date, or, in the case of material leased properties and assets, valid leasehold interests in such properties and assets, in each case free and clean of all Liens, except in each case in this Section 2.17(a) as would not reasonably be expected to have a Royale Company Material Adverse Effect, . (b) Schedule 2.17(b) of the Royale Parties Company Disclosure Schedule sets forth a complete and their Subsidiaries own and have either good and valid title in fee correct list of each parcel of real property owned or leased by the Company or the Company Subsidiary (the leases pursuant to which the Company or the Company Subsidiary is a valid leasehold interest, Right tenant of Way or other rights any such real property being hereinafter referred to as the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens"Leases"). Except As of the date of this Agreement, except as would not reasonably be expected to have a Royale Company Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and Adverse Effect (i) the Leases are in full force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither (ii) the Royale Parties nor Company is not in default of any of their Subsidiaries its obligations under the Leases and (iii) to the Company's knowledge, the landlords under the Leases are not in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of landlords' obligations under the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse EffectLeases. (c) Except as would not reasonably be expected to have a Royale Company Material Adverse Effect, the Royale Parties facilities, property and their Subsidiariesequipment owned, as applicableleased or otherwise used by the Company or the Company Subsidiary are in a good state of maintenance and repair, have defensible title free from material defects and in good operating condition (subject to all of the Royale Interests forming the basis normal wear and tear), and suitable for the reserves reflected in the Royale Financial Statements except purposes for such Royale Interests sold, which they are presently used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens . (other than Production Burdens). d) Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Company Material Adverse Effect, the Royale Parties tangible assets owned or leased by the Company and each applicable Subsidiary (A) the Company Subsidiary, together with its intangible assets, are in compliance with all valuation agreements, adequate to conduct the business and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms operations of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice Company and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure SchedulesCompany Subsidiary as currently conducted.

Properties and Assets. (a) Except The Company and its Subsidiaries have good and valid title to all of their respective material properties, interests in properties and assets, real and personal, reflected on the Most Recent Balance Sheet or acquired since the Most Recent Balance Sheet Date, or, in the case of material leased properties and assets, valid leasehold interests in such properties and assets, in each case free and clean of all Liens, except in each case in this Section 3.17(a) as would not reasonably be expected to have a Royale Company Material Adverse Effect, . (b) Section 3.17(b) of the Royale Parties Company Disclosure Schedule sets forth a complete and their correct list of each parcel of real property owned or leased by the Company or any of its Subsidiaries own (the “Leased Facilities),” with the leases pursuant to which the Company or any of its Subsidiaries is a tenant of any such Leased Facility being hereinafter referred to as the “Leases”). Section 3.17(b) of the Company Disclosure Schedule also sets forth a complete and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear correct summary of all liens (the Lease Facility Liability as of the date hereof. As of the date of this Agreement, except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Company Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and Adverse Effect (i) the Leases are in full force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, (ii) the Company is not in default of any of its obligations under the Leases and neither (iii) to the Royale Parties Company’s knowledge, the landlords under the Leases are not in default of the landlords’ obligations under the Leases. The Company has not been in default of any of its obligations under any Lease on more than three occasions in the twelve months preceding the date of this Agreement. The Company and its Subsidiaries have the right to assign the Leases to the Surviving Corporation and to allow the Parent and its Subsidiaries to occupy the Leased Facilities. At the Effective Date, the premises to be conveyed or leased by the Surviving Corporation following the Closing pursuant to the Leases shall be free and clear of all subtenants and occupants other than the Surviving Corporation’s employees. Neither the Company nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has granted to any Person any options or encumbrances on the Leased Facilities, which would allow such Rights of Way from each person as are sufficient Person to conduct its business as currently conducted, except for such Rights of Way interfere with or limit the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business Surviving Corporation’s rights in a manner that does not violate any of the Rights of Way, Leased Facilities during the term thereof and no event has occurred that allowsor circumstance exists which, with the delivery of notice, the passage of time or both, would constitute such a breach or default, or after notice permit the termination, modification or lapse acceleration of time would allow, revocation or termination thereof or would result in rent under any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse EffectLeases. (c) Except as would not reasonably be expected to have a Royale Company Material Adverse Effect, the Royale Parties all personal property and their Subsidiariesequipment owned, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out leased or otherwise disposed used by the Company or any of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, its Subsidiaries (i) none are in a good state of maintenance and repair, free from material defects and in good operating condition (subject to normal wear and tear), (ii) comply with the proceeds from the sale of Hydrocarbons produced from the Royale Interests applicable Leases and with all applicable Laws in any producing well are being held in suspense for any reasonall material respects, and (iiiii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except suitable for the rights of any lessor to take free gas under the terms of any applicable lease purposes for its use on the lands covered by such leasewhich they are presently used. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements.20 (d) All of To the ▇▇▇▇▇ ownedCompany’s knowledge, leasedthere is no condemnation, operated expropriation or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide appropriation proceeding pending or injection ▇▇▇▇▇ located on threatened against any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party Leased Facility or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Lawthe improvements thereon. (e) All Royale Interests True and correct copies of the documents under which the Leased Facilities are leased or subleased to or utilized and/or operated by the Royale Parties Company and their its Subsidiaries (the “Lease Documents”) have heretofore been operated in accordance with reasonable, prudent field practices delivered or made available to Parent. The Lease Documents are unmodified and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Returnfull force and effect. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected material to have Company and its Subsidiaries, taken as a Royale Material Adverse Effectwhole, the Royale Parties and their Subsidiaries own and have either good Company or a Subsidiary of Company has good, marketable and valid title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against set forth on Section 2.18(a) of the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale PartyCompany Disclosure Letter (such owned property collectively, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business“Company Owned Real Property”), free and clear of all liens and Production Burdens Liens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights free of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance material infractions with all applicable Laws exceptLaws, including those relating to zoning and building matters, and is the sole legal and beneficial owner thereof. The assets necessary for the conduct of the businesses as presently conducted and as proposed to be conducted are in each casereasonably good and serviceable operating condition and repair, as would not reasonably be expected to have a Royale Material Adverse Effect. No well ownedordinary wear and tear excepted, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015well maintained, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged conform in any oil, natural gas or other futures or option trading in respect of which it has any all material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instrumentsrespects with all applicable Laws. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there There are no pending or, to the Knowledge of each Royale PartyCompany’s knowledge, expected proposals contemplated or elections for drillingthreatened condemnation, completingexpropriation, recompletingrescission, reworkingcancellation requisition action (“action en rescision, facilities résolution, réquisition”) or similar activities that would require such commitment on behalf proceedings or actions with respect to all or any portion of the Royale Parties Company Owned Real Property. For purposes of this Agreement, any reference to “real property” shall mean and include “immoveable property” and any reference to “personal property” shall mean and include “moveable property.” (b) Except as would not be material to Company and its Subsidiaries, taken as a whole, either Company or a Subsidiary of Company has a good, marketable and valid leasehold interest in each lease, sublease and other agreement under which Company or any of their its Subsidiaries within one year of uses or occupies or has the Royale Merger Effective Time in any of right to use or occupy the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as real property set forth on Section 5.10(i2.18(b) of the Royale Company Disclosure SchedulesLetter (such property subject to a lease, none sublease or other agreement, the “Company Leased Real Property” and such leases, subleases and other agreements are, collectively, the “Company Real Property Leases”), in each case, free and clear of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain all Liens other than any minimum volume or throughput provisions or require the Royale Parties or Permitted Liens. Neither Company nor any of their its Subsidiaries to pay for services regardless of whether the Royale Parties is in material breach or any of their Subsidiaries deliver such production for use of the services provided for default under any Company Real Property Lease, nor does Company have knowledge of any condition that with the passage of time or the giving of notice or both would result in such Contracta breach or default. To the knowledge of Company, there is no material breach or default under, nor does there exist any condition that with the passage of time or the giving of notice or both would result in such a breach or default by any other party thereto. (jc) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee as would not be material to pay royalties on ▇▇▇▇▇▇Company and its Subsidiaries, taken as a whole, and (ii) causing for arrangements solely among Company and its Subsidiaries or among Company’s Subsidiaries, there are no leases, subleases, licenses, rights or other agreements affecting the oilCompany Owned Real Property or the Company Leased Real Property. Neither Company nor any of its Subsidiaries is currently subleasing, gas licensing or mineral lease otherwise granting any person the right to use or contract occupy any portion of a Company Owned Real Property or Company Leased Real Property. There are no outstanding options or rights of first refusal in favor of any other party to terminate without advance notice purchase any Company Owned Real Property or any portion thereof or interest therein. (d) The Company Owned Real Property and the opportunity to cure resulting Company Leased Real Property have been used and operated in a loss, all material respects in whole or in part, compliance with applicable Laws (including town planning documents and the provisions of any articles L. 631-7 et seq. of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure SchedulesFrench Building and Housing Code).

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties The Group Companies and their Subsidiaries do not own and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are validin fee simple. Disclosure Schedule 3.16(a) sets forth a true and complete list and description of all real property leased, binding and are in force and effect against the Royale Parties used or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated occupied by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties Group Companies and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear including a description of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens related land (other than Production Burdensthe “Real Property”). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i3.16(a) of the Royale Disclosure SchedulesSchedule, there are no leases, subleases, contracts, assignments, options, agreements (including, but not limited to, subordination and non-disturbance agreements, easements and licenses) or enforceable rights or obligations relating to or affecting the Real Property to which the Group Companies or their Subsidiaries are a party. (ii) To the Knowledge of the Group Companies, there are no material structural or nonstructural defects (including, without limitation, inadequacy for normal use of mechanical systems and fixtures) in any of the buildings or their systems or fixtures (including, without limitation, the HVAC system, plumbing system, electrical system, sprinkler system and sewer and water systems) or other improvements situated on the Real Property and, to the Knowledge of the Group Companies, all building systems, structures, fixtures and improvements situated on the Real Property and all building systems, structures, fixtures and improvements, owned, leased or used by the Group Companies and their Subsidiaries, are in all material respects in good condition and working order (reasonable wear and tear excepted) and are adequate in quality and quantity for the normal operation of the Business and the Real Property as they previously have been conducted, and all tenant assignments to any leased space have been satisfactorily completed. (iii) To the Knowledge of the Group Companies, none of the Contracts Real Property is located in respect of gatheringa recognized wetland, processingflood prone area, storage flood risk area, flood plain or transportation of the production of Hydrocarbons from the Royale Interests contain similarly restricted area or is subject to any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contractshoreland regulations. (jiv) To the Knowledge of the Group Companies, there are no capital expenditures on the Real Property (excluding only normal repairs and maintenance made consistently with past practice) that would be necessary to conduct the Business as presently conducted nor are any such expenditures planned by the Group Companies or their Subsidiaries. (v) The Group Companies and their Subsidiaries have all rights, including without limitation, access to all utilities and ways for ingress and egress necessary to conduct the Business as currently conducted (including, without limitation, accesses for ingress and egress of vehicles across the driveways and roadways presently existing at the Real Property used to access the public roadways) for the full term of the relevant lease or other ownership period. (vi) To the Knowledge of the Group Companies, neither the whole nor any portion of the Real Property has been condemned, requisitioned or otherwise taken by any public authority, no notice of such condemnation, requisition or taking has been served upon any of the Group Companies or their Subsidiaries and, to the Knowledge of the Group Companies no such condemnation, requisition or taking is threatened or contemplated. (vii) No public improvements have been commenced and, to the Knowledge of the Group Companies, there are no public improvements planned which could result in special assessments against or otherwise adversely affect any of the Real Property. (viii) Except for increases consistent with past experience and except as set forth in Disclosure Schedule 3.16(a), to the Knowledge of the Group Companies there are no proposed increases in any real estate taxes or assessed valuations applicable to the Real Property, and there are no challenges or appeals by any of the Group Companies or their Subsidiaries pending regarding the amount and/or payments of such real estate taxes or assessed valuations. (ix) To the Knowledge of the Group Companies, no governmental agency has issued any work order, and there have been no court orders, requiring repairs, alterations or corrections of any condition on the Real Property. (x) To the Knowledge of the Group Companies, there is no pending or threatened litigation (including actions, suits, claims or proceedings, judicial or administrative) against or affecting the Real Property. (xi) The Real Property has been operated by the Group Companies and their Subsidiaries in compliance, in all material respects, with all federal, state, county, municipal or other government standards, laws, ordinances, statutes, regulations and requirements. (xii) To the Knowledge of the Group Companies, the applicable zoning ordinances allow for the Real Property to be used for the Business and there is no contemplated change in the zoning classification for the Real Property. (xiii) To the Knowledge of the Group Companies, the Real Property has been operated in compliance, in all material respects, with all applicable private restrictions, covenants, rules, standards and requirements. (xiv) To the Knowledge of the Group Companies, each parcel of Real Property is a separate parcel for real estate tax purposes and includes no other land or improvement not part of the Real Property. (xv) To the Knowledge of the Group Companies, there are no disputes as to title, ownership, interest or control of any Real Property to which any leases, contracts, assignments, options, agreements or enforceable rights or obligations of which the Group Companies or their Subsidiaries relate. (xvi) To the Knowledge of the Group Companies, there are no currently existing uncured defaults on the part of the landlords of the Group Companies or their Subsidiaries, or of any Third Parties with respect to their obligations to the Group Companies with respect to the Real Property. (xvii) Except as set forth in Section 5.10(j) of the Royale on Disclosure SchedulesSchedule 3.16(a), none of the Contracts relating there are no liens, mortgages, land contracts, security interests or debt obligations to any lender or any other third party granted by any Group Company, with respect to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure SchedulesReal Property.

Properties and Assets. (a) Except as would not reasonably be expected to set forth in Section 3.16(a) of the Company Disclosure Schedule, (i) the Company and the Subsidiaries of the Company have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries own and have either good and valid title to, or, in fee or a the case of leased properties and assets, valid leasehold interestinterests in, Right all of Way their tangible properties and assets (in each case, having a fair market value in excess of $25,000), real and personal, used or other rights held for use in their businesses as currently conducted or shown on the most recent consolidated balance sheet of the Company included in the Company SEC Documents prior to the landdate hereof or acquired thereafter (except for properties and assets disposed of in the ordinary course of business consistent with past practice after the date of such balance sheet), mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of any Liens, except Permitted Liens and Aircraft Liens, (ii) the assets, rights and properties of the Company and its Subsidiaries, taken as a whole, constitute all liens of the assets, rights and properties which are currently used by the Company and its Subsidiaries in the operation of their businesses or necessary to conduct their businesses and operations as currently conducted and (except iii) all of the property, plant and equipment of the Company and each of its Subsidiaries has been maintained in reasonable operating condition and repair, ordinary wear and tear excepted, and is sufficient to permit the Company and its Subsidiaries to conduct their operations as currently conducted. (b) Section 3.16(b) of the Company Disclosure Schedule sets forth a complete and correct list and legal description of all cases for Permitted Liensreal property owned in fee by the Company or any Subsidiary of the Company (collectively, the “Owned Real Property”). Except as set forth in Section 3.16(a) of the Company Disclosure Schedule, neither the Company nor any Subsidiary of the Company is obligated under, or a party to, any option, right of first refusal or other contractual right to sell, assign or dispose of any Owned Real Property or any portion thereof. Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Company Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its , the obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, Company and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms Company with regard to all applicable covenants, easements and restrictions affecting the Owned Real Property have been and are being performed in a proper and timely manner by the Company or a Subsidiary of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse EffectCompany, as applicable. (c) Except Section 3.16(c) of the Company Disclosure Schedule sets forth a complete and correct list of all material real property leased, subleased or licensed by the Company or any Subsidiary of the Company (collectively, the “Leased Real Property” and together with the Owned Real Property, the “Real Property”). The Company has heretofore made available to Merger Sub true and complete copies of all leases, subleases, licenses and other agreements under which the Company and/or any Subsidiary of the Company uses or occupies or has the right to use or occupy, now or in the future, any Leased Real Property, including all modifications, amendments and supplements thereto (collectively, the “Real Property Leases”). With respect to the Leased Real Property, except as disclosed in Section 3.16(c) of the Company Disclosure Schedule or as would not reasonably be expected to have a Royale Company Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, : (i) none the Company or the applicable Subsidiary of the proceeds from Company enjoys peaceful and undisturbed possession of the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and premises leased pursuant to each Real Property Lease; (ii) there are no calls on production with respect to any Real Property Leases that were assigned (or preferential rights deemed assigned pursuant to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of such Real Property Lease) or subleased to the Company or any applicable lease for its use on Subsidiary of the lands covered Company by a third party, all consents to such lease. Except as would not reasonably be expected to assignments (or deemed assignments) or subleases have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements been obtained which were required with respect to Production Burdenssuch assignments (or deemed assignments) or subleases; (iii) the current use of the premises leased, and (B) have paid subleased or will cause to be paid when due all Production Burdens licensed under each Real Property Lease complies with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of such Real Property Lease; (iv) no Real Property Lease has been assigned, mortgaged, hypothecated or otherwise encumbered; and (v) neither the applicable Contract Company nor any Subsidiary of the Company has, nor, to the Company’s knowledge, has any other party thereto (including the lessor or as reserved against in the Royale Financial Statementssublessor thereunder) waived any terms or conditions of any Real Property Lease. (d) All With respect to each parcel of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion Owned Real Property: (and plugging and abandonmenti) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf knowledge of the Royale Parties Company, threatened hearings, investigations, reviews, claims, actions, suits or proceedings relating to any such parcel or other matters affecting materially adversely the current use, occupancy or value thereof; (ii) the ownership and operation of the Owned Real Property in the manner in which it is now owned and operated comply in all material respects with all zoning, building, use, safety or other similar statutes, ordinances or regulations of any Governmental Entity; and (iii) neither the Company nor any of their its Subsidiaries within one year has received any notice of any material special Tax, levy or assessment for benefits or betterments that affect any Owned Real Property and, to the knowledge of the Royale Merger Effective Time in any Company, no such material special Taxes, levies or assessments are pending or contemplated. The Real Property comprises all of the Royale Interests or any material real property used in the businesses of the contracts governing any of the Royale InterestsCompany and its Subsidiaries. (ie) Except as set forth on Section 5.10(i3.16(e) of the Royale Company Disclosure SchedulesSchedule sets forth a true, none correct and complete list of each material lease, sublease, license or other agreement executed by the Company or any Subsidiary of the Contracts in respect Company granting to any third party a right to the use, occupancy or enjoyment of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties Real Property or any portion thereof (the “Real Property Subleases”). The Company has heretofore made available to Merger Sub true and complete copies of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests all Real Property Subleases (including all oilamendments, gas modifications, supplements, and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedulesextensions thereof).

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Corporation Material Adverse Effect, the Royale Parties Corporation or a Subsidiary of the Corporation each respectively owns and their Subsidiaries own and have has either good and valid title in fee or a valid leasehold interest, Right of Way (defined below) or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Corporation Material Effect, all leases, Rights of Way or other agreements under which any Royale Party the Corporation or any of their its Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties Corporation or any of their its Subsidiaries and, to the Knowledge of each Royale Partythe Corporation, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties Corporation nor any of their its Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party of the Corporation and its Subsidiaries has such consents, easements, rights of way, permits and licenses (collectively, “Rights of Way Way”) from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Corporation Material Adverse Effect. Each Royale Party of the Corporation and its Subsidiaries has fulfilled and performed all its material obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Corporation Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries Corporation are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that materially affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party the Corporation, the Matrix LPs, Matrix or any of their its Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Corporation Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Corporation Material Adverse Effect, the Royale Parties Corporation and their its Subsidiaries, as applicable, have defensible title to all of the Royale Property Interests forming the basis for the reserves reflected in the Royale Audited Financial Statements except for such Royale Property Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Corporation Material Adverse Effect or as set forth on Section 5.10(c4.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Property Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or or, preferential rights to purchase Hydrocarbons and neither the Royale Parties Corporation nor any of their its Subsidiaries are not is obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Corporation Material Adverse Effect, the Royale Parties Corporation and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Property Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties Corporation and their its Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties Corporation and their its Subsidiaries or otherwise associated with the Royale Property Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Corporation Material Adverse Effect. No well owned, leased, operated or used by any Royale Party the Corporation or any of their its Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Property Interests operated by the Royale Parties Corporation and their its Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Corporation Material Adverse Effect. None of the Interests of the Royale Parties Corporation or their its Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Corporation Material Adverse Effect. Except as set forth on Section 5.10(e4.10(e) of Royale Disclosure Schedules, none of the Royale Property Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report Summary Projection of Netherland, ▇▇▇▇▇▇ & Associates, Inc. Reserves and Revenues as of December March 31, 20152016, and dated February 1of the Corporation, with run date June 10, 2016, a correct and complete copy of which the Corporation has made available to Royale prior to the date of this Agreement. (g) Except as set forth on Section 5.10(g4.10(g) of the Royale Disclosure Schedules, no Royale Party the Corporation is not engaged in any oil, natural gas or other futures or option options trading in respect of which it has any material future liability, nor is any Royale Party it a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g4.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party the Corporation for the delivery of Hydrocarbons attributable to any of the Royale Property Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g4.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party the Corporation is not bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h4.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Partythe Corporation, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties Corporation or any of their its Subsidiaries within one year of the Royale Merger Effective Time Closing Date in any of the Royale Property Interests or any of the contracts governing any of the Royale Property Interests. (i) Except as set forth on Section 5.10(i4.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Property Interests contain any minimum volume or throughput provisions or require the Royale Parties Corporation or any of their its Subsidiaries to pay for services regardless of whether the Royale Parties Corporation or any of their its Subsidiaries deliver delivers such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j4.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Property Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Property Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i4.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Company Material Adverse Effect, (i) the Royale Parties Company and their the Subsidiaries own and of the Company have either good and valid title to, or, in fee or a the case of leased properties and assets, valid leasehold interestinterests in, Right all of Way their tangible properties and assets, real and personal, used or other rights held for use in their businesses as currently conducted or shown on the most recent consolidated balance sheet of the Company included in the Company SEC Documents prior to the landdate hereof or acquired thereafter (except for properties and assets disposed of in the ordinary course of business consistent with past practice after the date of such balance sheet), mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (any Liens, except in all cases for Permitted Liens, (ii) the assets and properties of the Company and its Subsidiaries, taken as a whole, constitute all of the assets and properties which are necessary to conduct the business and operations of the Company and its Subsidiaries as currently conducted and (iii) all of the property, plant and equipment of the Company and each of its Subsidiaries has been maintained in reasonable operating condition and repair, ordinary wear and tear excepted, and is sufficient to permit the Company and its Subsidiaries to conduct their operations as currently conducted. (b) Section 3.16(b) of the Company Disclosure Schedule sets forth a complete and correct list of all real property owned in fee by the Company or any Subsidiary of the Company (collectively, the “Owned Real Property”). Neither the Company nor any Subsidiary of the Company is obligated under, or a party to, any option, right of first refusal or other contractual right to sell, assign or dispose of any Owned Real Property or any portion thereof. Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Company Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its , the obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, Company and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms Company with regard to all applicable covenants, easements and restrictions affecting the Owned Real Property have been and are being performed in a proper and timely manner by the Company or a Subsidiary of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse EffectCompany, as applicable. (c) Except Section 3.16(c) of the Company Disclosure Schedule sets forth a complete and correct list of all real property leased, subleased or licensed by the Company or any Subsidiary of the Company (collectively, the “Leased Real Property” and together with the Owned Real Property, the “Real Property”). The Company has heretofore made available to Parent true and complete copies of all leases, subleases, licenses and other agreements under which the Company and/or any Subsidiary of the Company uses or occupies or has the right to use or occupy, now or in the future, any Leased Real Property, including all modifications, amendments and supplements thereto (collectively, the "Real Property Leases”). With respect to the Leased Real Property, except as would not reasonably be expected to have a Royale Company Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, : (i) none the Company or the applicable Subsidiary of the proceeds from Company enjoys peaceful and undisturbed possession of the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and premises leased pursuant to each Real Property Lease; (ii) there are no calls on production with respect to any Real Property Leases that were assigned (or preferential rights deemed assigned pursuant to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of such Real Property Lease) or subleased to the Company or any applicable lease for its use on Subsidiary of the lands covered Company by a third party, all consents to such lease. Except as would not reasonably be expected to assignments (or deemed assignments) or subleases have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements been obtained which were required with respect to Production Burdenssuch assignments (or deemed assignments) or subleases; (iii) the current use of the premises leased, and (B) have paid subleased or will cause to be paid when due all Production Burdens licensed under each Real Property Lease complies with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of such Real Property Lease; (iv) no Real Property Lease has been assigned, mortgaged, hypothecated or otherwise encumbered; and (v) neither the applicable Contract Company nor any Subsidiary of the Company has, nor, to the Company’s knowledge, has any other party thereto (including the lessor or as reserved against in the Royale Financial Statementssublessor thereunder) waived any terms or conditions of any Real Property Lease. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g3.16(d) of the Royale Company Disclosure SchedulesSchedule sets forth a true, no Royale Party is engaged in any oilcorrect and complete list of each lease, natural gas sublease, license or other futures agreement executed by the Company or option trading in respect any Subsidiary of which it has any material future liability, nor is any Royale Party a party the Company granting to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, third party a right to the Knowledge use, occupancy or enjoyment of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties any Real Property or any portion thereof (the “Real Property Subleases”). The Company has heretofore made available to Parent true and complete copies of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests all Real Property Subleases (including all oilamendments, gas modifications, supplements, and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedulesextensions thereof).

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Material Adverse Effect, for the Royale Parties and their Subsidiaries own and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights Leased Real Property that is subject to the landUK Lease, mineral there is no Leased Real Property leased or subleased by Sellers and other subsurface rights, buildings, structures used primarily in connection with the Business and other improvements thereon and fixtures thereto necessary there is no Leased Real Property leased or subleased by the Companies. Neither of the Sellers with respect to permit it to conduct its business as currently conducted, in each case free and clear of all liens the Business nor the Companies (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use i) owns any real property are valid, binding and are in force and effect against or (ii) is a party to or is bound by any Contract for the Royale Parties purchase or any sale of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreementsreal property. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any Section 4.15(b) of the Rights Disclosure Schedule contains a list of Wayall machinery, equipment, vehicles, furniture and no event has occurred that allows, other tangible personal property owned by Sellers and used primarily in connection with the Business or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse EffectCompanies. (c) Except as would not reasonably be expected to have Section 4.15(c) of the Disclosure Schedule contains a Royale Material Adverse Effectlist and description of each lease or other agreement or right, whether written or oral (showing in each case the annual rental, the Royale Parties expiration date thereof and their Subsidiariesa brief description of the property covered), as applicableunder which either Seller is lessee of, or holds or operates, any machinery, equipment, vehicle or other tangible personal property owned by a third Person and used primarily in connection with the Business or either of the Companies are lessee of, or hold or operate, any machinery, equipment, vehicle or other tangible personal property owned by a third Person. (d) Sellers have defensible good and marketable title to, or in the case of any leased property included in the Assets have valid leasehold interests in, all Assets, free and clear of any Encumbrance, other than Permitted Encumbrances. Upon delivery to Purchaser of the ▇▇▇▇ of Sale and other instruments of transfer contemplated by Section 3.6(d), Sellers will thereby transfer to Purchaser good and marketable title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of businessAssets, free and clear of all liens and Production Burdens Encumbrances, other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable LawEncumbrances. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonablePolaRx has good title to, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report case of Netherlandleased property and assets has valid leasehold interests in, ▇▇▇▇▇▇ & Associatesall of its physical assets, Inc. as free and clear of December 31any Encumbrances, 2015other than Permitted Encumbrances. UK has good title to, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account case of prepaymentleased property and assets, advance paymenthas valid leasehold interests in, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) all of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations its physical assets free and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, clear of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunderEncumbrances, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedulesother than Permitted Encumbrances.

Properties and Assets. (a) Section 3.13(a) of the Hampshire Bank Disclosure Schedule lists: (i) all real property owned by Hampshire Bank; (ii) each real property lease, sublease or installment purchase arrangement to which Hampshire Bank is a party; and (iii) a description of each contract for the purchase, sale, or development of real estate to which Hampshire Bank is a party. Except as would not reasonably be expected set forth in Section 3.13(a) of the Hampshire Bank Disclosure Schedule, Hampshire Bank has good and, as to have a Royale Material Adverse Effectreal property, the Royale Parties and their Subsidiaries own and have either good and valid marketable title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except Liens on all of the properties and assets, real and personal, which, individually or in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effectthe aggregate, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, material to the Knowledge business of each Royale PartyHampshire Bank, and which are reflected on the counterparties theretoHampshire Bank Financials, except: (i) Liens for Taxes not yet due and payable; (ii) pledges to secure deposits and other Liens incurred in the ordinary course of banking business; and (iii) such imperfections of title, easements and encumbrances, if any, as are not material in character, amount or extent. All leases pursuant to which Hampshire Bank, as lessee, leases real and personal property which, individually or in the aggregate, are material to the business of Hampshire Bank taken as a whole, are assignable, valid and enforceable in accordance with their respective terms, except where the failure of such lease or leases to be valid and neither enforceable would not, individually or in the Royale Parties nor any of their Subsidiaries are in default under any such leasesaggregate, Rights of Way or other agreementshave a Material Adverse Effect on Hampshire Bank. (b) Each Royale Party and its Subsidiaries Hampshire Bank has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations experienced any material uninsured damage or destruction with respect to such Rights properties. All properties and assets used by Hampshire Bank are in good operating condition and repair suitable for the purposes for which they are currently utilized and comply in all material respects with all Laws relating thereto now in effect or, to Hampshire Bank’s Knowledge, scheduled to become effective. Hampshire Bank enjoys peaceful and undisturbed possession under all leases for the use of Way all property under which it is the lessee. Hampshire Bank is not in material default with respect to any such lease, and conducts their business in there has occurred no default, or event, which with the lapse of time or the giving of notice, or both, would constitute a manner that does not violate material default, by Hampshire Bank under any such lease. There are no Laws, conditions of record, or other impediments which interfere with the intended use by Hampshire Bank of any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used occupied by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Lawthem. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Material Adverse Effectfor Assets disposed of in the ordinary course of business since the Interim Balance Sheet Date, the Royale Parties and their Subsidiaries own and have either Scout owns good and valid title in fee to, or a holds pursuant to valid leasehold interestand enforceable leases of, Right all of Way the personal property shown to be owned or other rights to leased by it on the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conductedInterim Financial Statements, in each case free and clear of all liens (Encumbrances, except in all cases for Permitted LiensEncumbrances. (b) Schedule 3.16(b) of the Disclosure Schedule sets forth a true and complete list of all leasing, sublease, license, or other occupancy agreements for the use or occupancy of real property to which each Scout Group Member is a party (each, a “Lease” and, collectively, the “Leases”) and/or an address or description of the real property demised under each of the Leases, each, a “Leased Property” and collectively the “Leased Properties”). Such Scout Group Member has a good and valid leasehold interest in each Leased Property subject only to the terms and conditions of the applicable Lease and to any Permitted Encumbrances. Except as would not reasonably be expected set forth in Schedule 3.16(b) of the Disclosure Schedule, no Scout Group Member has granted to have a Royale Material Effectany Person, all leaseswhether by sublease or otherwise, Rights of Way the right to use or other agreements under which occupy any Royale Party Leased Property or any of their Subsidiaries lease, access or use any real property are valid, binding and portion thereof. All Leases are in full force and effect and are binding and enforceable against the Royale Parties or any of their Subsidiaries applicable Scout Group Member and, to the Knowledge of each Royale Partythe Seller, against the counterparties theretorespective third party lessors, in accordance with their respective termssublessors, licensors, and neither the Royale Parties nor any of their Subsidiaries are in default under any other parties to such leasesLeases (collectively, Rights of Way “Lessors”), except as such enforceability may be limited by bankruptcy, insolvency, moratorium or other agreements. (b) Each Royale Party similar legal requirements affecting or relating to creditors’ rights generally and its Subsidiaries has such Rights general principles of Way from each person as are sufficient to conduct its business as currently conductedequity, except for such Rights regardless of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business whether asserted in a manner that proceeding in equity or at law. Correct and complete copies of all such Leases, as restated, supplemented, amended or modified through the date hereof, have been made available to Purchaser. The Scout Group does not violate any of the Rights of Wayown, and no event has occurred that allowsnot owned during the past five years, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effectreal property. (c) Except as would not reasonably be expected With respect to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, Leases: (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary Scout Group Member: (A) are is in compliance with all valuation agreements, and settlement agreements with respect default of any covenant or agreement to Production Burdens, pay rent or additional rent thereunder; and (B) have paid or will cause to be paid when due all Production Burdens with has received any written notice, and otherwise has no Knowledge of, any other default by either Scout Group Member in any material respect under any of the other terms of the Leases; (ii) to the Royale Interests and each other royaltyKnowledge of the Seller, Tax or similar payment, except for such amounts that are being held no Lessor is in suspense as permitted pursuant to applicable Law or default in any material respect under any of the terms of the Leases; and (iii) to the Knowledge of the Seller, no event has occurred and no circumstance exists which, if not remedied, and whether with or without notice or the passage of time or both, would result in such a default by either Scout Group Member, or permit the termination or modification of, or acceleration of rent under, any Lease. To the Knowledge of the Seller, the present use of the Leased Properties is in substantial conformity with all applicable Contract legal requirements, and neither Scout Group Member nor the Seller has received any written notice of any violation or as reserved against in the Royale Financial Statementsalleged violation thereof. (d) All No security deposit or portion thereof deposited with respect any Lease has been applied in respect of the ▇▇▇▇▇ owned, leased, operated a breach or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have default under such Lease which has not been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted redeposited in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Lawfull. (ei) All Royale Interests operated Other than the Leases, all leases, subleases, licenses, and other use and occupancy agreements for real property in which the Scout Group Members were a party or had any right or interest (collectively, the “Terminated Leases”) have expired or been terminated; (ii) all rents and other sums due and payable by either Scout Group Member in connection with the Royale Parties and their Subsidiaries Terminated Leases have been operated paid in accordance full; and (iii) all obligations imposed on Scout or the Seller in connection with reasonable, prudent field practices any Terminated Leases have been fully satisfied and neither any Scout Group Member nor the Seller have any remaining Liability in compliance connection with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax ReturnTerminated Leases. (f) There are no material inaccuracies The Scout Group is in the report occupancy of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) all of the Royale Disclosure Schedules, Leased Properties and no Royale Party is engaged in Person other than the Scout Group has the right to use or occupy any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) portion of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any Leased Property other than Scout. The Leases constitute all of the Royale Interests in real property used, occupied or operated by the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securitiesScout Group. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected with respect to have a Royale Material Adverse EffectIntellectual Property, which is the Royale Parties subject of Section 4.10 below, each of the Company and their is Subsidiaries own and have either has good and valid marketable title or leasehold title, as the case may be, to all of its assets and properties that it purports to own or lease, including without limitation all those reflected in fee the Company’s Balance Sheet (except for properties or a valid leasehold interestassets sold, Right consumed, or otherwise disposed of Way or other rights to in the landordinary course of business since the date of the Company’s Balance Sheet), mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case all free and clear of all liens (except in all cases for Permitted Liens)Liens on the there respective interest therein. Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding All such properties and assets are in force good condition and effect against the Royale Parties or any of their Subsidiaries repair, reasonable wear-and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms-tear excepted, and neither are, and as of the Royale Parties nor any Closing Date will be, adequate and sufficient to carry on the business of their the Company and its Subsidiaries are in default under any such leases, Rights as presently conducted. Schedule 4.9 of Way or other agreementsthe Company Disclosure Schedule sets forth a complete and correct list of all capital assets of the Company and its Subsidiaries. (b) Each Royale Party and Neither the Company nor any of its Subsidiaries owns any real property. Neither the Company nor any of its Subsidiaries has received any written notice or otherwise has knowledge that either the whole or any portion of any real property leased by it is to be condemned, requisitioned, or otherwise taken by any public authority or is to be the subject of any public improvements that may result in special assessments against or otherwise affect such Rights real property. Schedule 4.9 of Way from each person as are sufficient the Company Disclosure Schedule sets forth a complete and correct description of all leases of real property to conduct which the Company or any of its business as currently conducted, except for Subsidiaries is a party. Complete and correct copies of all such Rights of Way the absence of which leases have not had and would not reasonably be expected been delivered to have a Royale Material Adverse EffectParent. Each Royale Party such lease is valid and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, subsisting and no event has occurred or condition exists that allowsconstitutes, or after notice or lapse of time would allowor both could constitute, revocation a default thereunder by the Company or termination thereof any of its Subsidiaries, or would result in to the best of its knowledge, any impairment other person. The leasehold interests of the rights of the holder of any such Rights of Way, except for such revocations, terminations Company and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their its Subsidiaries are subject to Rights of Wayno Lien, there are no encroachments and the Company or other encumbrances on its Subsidiary, as the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries case may be, is in quiet possession of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands properties covered by such leaseleases. Except as would not reasonably be expected to have a Royale Material Adverse Effect, Company has notified the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All lessor of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by Lease that Company is terminating the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December Lease when it expires on July 31, 2015, and dated February 1, 20162009. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would The Asset Selling Entities do not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries own and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are validthat is used primarily in the Business. The Conveyed Companies do not own any real property. (b) The Asset Selling Entities do not have any leasehold interests in real property that is used primarily in the Business. Schedule 3.12(b) of the Seller Disclosure Letter sets forth a list as of the date hereof of each Real Property Lease, binding and are all leasehold interests (including any prepaid rent, security deposits or options to renew or purchase in connection therewith) in real property of the Conveyed Companies used primarily in the Business. True and complete copies of all leases (together with all amendments, modifications or supplements thereto) set forth on Schedule 3.12(b) of the Seller Disclosure Letter have been made available to Purchaser. Each lease set forth on Schedule 3.12(b) of the Seller Disclosure Letter is in full force and effect against and there exists no breach, default or event of default by the Royale Parties or any of their Subsidiaries andapplicable Conveyed Company or, to the Knowledge of each Royale PartySeller, the counterparties theretoany other party to any such lease, with respect to any material term or provision of any such lease, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of case which have not had and would not reasonably be expected to have have, individually or in the aggregate, a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights To the Knowledge of Way and conducts their business in a manner that Seller, there does not violate exist any actual condemnation or eminent domain proceedings that affect any Leased Real Property or any part thereof, and none of the Rights of Way, and no event Conveyed Companies or Seller has occurred that allows, or after received any written notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder intention of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments Governmental Authority or other encumbrances on the Rights of Way that affect the Person to take or use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party all or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effectpart thereof. (c) Except as would not reasonably be expected to have set forth in Schedule 2.2(a) or Schedule 3.12(c) of the Seller Disclosure Letter, each Asset Selling Entity and Conveyed Company has good and marketable title to, or a Royale Material Adverse Effectvalid leasehold interest in, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected items of material tangible personal property used in the Royale Financial Statements Business (except for such Royale Interests sold, used, farmed out as sold or otherwise disposed of since December 31, 2015, subsequent to the date thereof in the ordinary course of businessbusiness and not in violation of this Agreement), free and clear of any and all liens Liens. All such items of tangible personal property which, individually or in the aggregate, are material to the operation of the business of the Conveyed Company are in good operating condition and Production Burdens other than Production Burdens not yet earned, due or payable in a state of good maintenance and Permitted Liens repair (other than Production Burdensordinary wear and tear excepted). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(cSchedule 2.2(a) and Schedule 3.12(c) of the Royale Seller Disclosure SchedulesLetter set forth a list of leases of personal property held by each Asset Selling Entity and Conveyed Company, (i) none respectively, as of the proceeds from the sale date of Hydrocarbons produced from the Royale Interests in any producing well this Agreement that are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect material to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms operation of the applicable Contract or as reserved against in the Royale Financial StatementsBusiness. (d) All The aggregate book value of the ▇▇▇▇▇ ownedfixed assets of the Asset Selling Entities relating primarily to the Business and the fixed assets of the Conveyed Companies, leased, operated or used by excluding the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each caseExcluded Assets, as would not reasonably be expected to have a Royale Material Adverse Effect. No well ownedof September 28, leased2012 is $5,537,040, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated as determined in accordance with reasonableSeller’s accounting policies, prudent field principles, practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Returnmethodologies. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Section 4.15(a) of the Company Disclosure Letter sets forth the address or other description of each parcel of real property owned by the Company or its Subsidiaries (collectively, the "Owned Real Property"). Except as would not reasonably be expected set forth in Section 4.15(a) of the Company Disclosure Letter and subject to have a Royale Material Adverse Effectany Permitted Liens, (i) the Royale Parties and their Company or one of its Subsidiaries own and have either has good and valid merchantable title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral Owned Real Property and other subsurface rights, to all of the buildings, structures and other improvements thereon located thereon, (ii) the Company and fixtures thereto necessary to permit it to conduct its business as currently conductedSubsidiaries have not leased, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries andlicensed or, to the Knowledge knowledge of each Royale Partythe Company, otherwise granted any Person the counterparties thereto, right to use or occupy such Owned Real Property or any portion thereof and (iii) the Company and its Subsidiaries have not collaterally assigned or granted any other security interest in accordance with their respective terms, such Owned Real Property. The Owned Real Property constitutes all of the real property owned by the Company and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreementsits Subsidiaries. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c4.15(b) of the Royale Company Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure SchedulesLetter lists, as of the date hereof, no Royale Party is bound each parcel of all leasehold or subleasehold estates and other rights to use or occupy any land, buildings or structures used by futures, hedge, swap, collar, put, call, floor, cap, option the Company or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations its Subsidiaries in the price course of commoditiestheir respective businesses (the "Leased Real Property"). Prior to the date hereof, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) the Company has made available to Parent a true and complete schedule of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Leases. Except as set forth in Section 5.10(j4.15(b) of the Royale Company Disclosure SchedulesLetter or as, none of individually or in the Contracts relating aggregate, would not reasonably be likely to have a Material Adverse Effect on the Royale Interests (including all oilCompany, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee Company and its Subsidiaries have not subleased or licensed to pay royalties on ▇▇▇▇▇▇any Person the right to use or occupy such Leased Real Property or any portion thereof, (ii) causing to the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any knowledge of the Royale Interests for lessee’s failure Company, there are no disputes with respect to pay royalties or for lessee’s breach of any covenant thereundersuch Lease, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, Company and its Subsidiaries have not collaterally assigned or granted any other security interest in such Lease or any interest therein and (iv) there are no Liens, except for Permitted Liens, on the estate or interest created by such Lease. (c) Since January 1, 2001 through the date hereof, (i) no written notice from any Governmental Authority has been received by the Company or any of its Subsidiaries requiring or calling attention to the need for any material work, repair, construction, alteration or installation on, or in connection with, the Owned Real Property or the Leased Real Property, and (ii) no material assessment for public improvement that is expected due and remains unpaid has been made against any Owned Real Property or Leased Real Property and, to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) the knowledge of the Royale Disclosure SchedulesCompany, there are no currently proposed or pending assessments for public improvements against any Owned Real Property or Leased Real Property. (d) The Company and its Subsidiaries have good title to their owned assets, or in the case of assets and properties that they lease, license or have other rights in, valid rights by lease, license or other agreement to use, all assets and properties (in each case, tangible and intangible) necessary to permit the Company and its Subsidiaries to conduct their business as currently conducted, except where the failure to have such title, or rights by lease, license, or other agreement to use would not reasonably be likely to have a Material Adverse Effect on the Company. The assets and properties (in each case, tangible and intangible) owned or used by the Company and its Subsidiaries are in satisfactory condition and repair for their continued use as they have been used and are adequate in all material respects for their current use, reasonable wear and tear excepted, except where the failure to be in satisfactory condition and repair would not reasonably be likely to have a Material Adverse Effect on the Company.

Properties and Assets. (a) Except as expressly contemplated by the Spin-Off Agreements or as would not reasonably be expected to have have, individually or in the aggregate, a Royale Company Material Adverse Effect, the Royale Parties Company and their each of the Company Subsidiaries own have, and have either immediately following the Effective Time will continue to have, good and valid title in fee or a valid leasehold interestto their owned material assets and properties, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens Liens (except in all cases for other than Permitted Liens), or in the case of material assets and properties they lease, license, or have other rights in, good and valid rights by lease, license or other agreement to use, all material assets and properties (in each case, tangible and intangible), in each case, necessary to permit the Company and each of the Company Subsidiaries to conduct their respective businesses in all material respects as currently conducted. Except as would not reasonably be expected to have have, individually or in the aggregate, a Royale Company Material Adverse Effect, all leasesthe material assets and properties (in each case, Rights of Way tangible or other agreements under which any Royale Party intangible) owned or any of their Subsidiaries lease, access used by the Company or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Company Subsidiaries are in default under any such leasessatisfactory condition for their continued use as they have been used and adequate in all material respects for their current use, Rights of Way or other agreementssubject to reasonable wear and tear. (b) Each Royale Party The assets of the Company and its Subsidiaries has such Rights as at and immediately following the Effective Time, together with the sources of Way from each person cash to be available to the Company after the Effective Time as are arranged by the Buyer, and the services to be provided pursuant to the Transition Services Agreement, will be sufficient to conduct its business as currently conducted, except for such Rights of Way permit the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party Surviving Corporation and its Subsidiaries has fulfilled and performed all its obligations with respect subsidiaries to such Rights of Way and conducts their business in a manner that does not violate any carry on the functional operation of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of Television Business immediately following the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, Effective Time (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, all material respects and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and in a manner consistent with the Royale Parties nor any operation of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect business immediately prior to the Royale Interests Effective Time. Notwithstanding the foregoing, it is understood and each other royaltyagreed that the immediately preceding sentence shall not be deemed a representation or warranty as to any revenue, Tax costs or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise expenses associated with the Royale Interests have been drilledconduct of the Surviving Corporation’s or its Subsidiaries’ business immediately following the Effective Time, completed and operated within the limits permitted immediately preceding sentence assumes the receipt of all necessary authorizations, approvals, consents or waivers required by law or by Governmental Authorities in connection with the transactions contemplated by the applicable Contract granting such rights Spin-Off Agreements and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Each Subject Company has a valid and enforceable leasehold interest in each of the leased premises in which it currently conducts its business, except as may be affected by bankruptcy, insolvency, reorganization, moratorium and other similar laws relating to or affecting creditors’ rights generally or general equitable principles. Section 2.12(a) of the ARC Disclosure Letter identifies, as of the date hereof, all of the leases for real property to which each Subject Company is a party (the “Leases”). The Leases constitute all real property leased, subleased, licensed or otherwise used in the operation of the business of the Subject Companies as presently conducted. Complete and correct copies of such Leases have been provided to AMH. As of the date hereof, there is no material default by the lessee or, to ARC’s Knowledge, the lessor under any such lease and to ARC’s Knowledge the use and operation of the property subject to the Leases does not violate in any material respect any Applicable Law. No Subject Company owns any real property. Except as would not reasonably may be expected affected by bankruptcy, insolvency, reorganization, moratorium and other similar laws relating to have a Royale Material Adverse Effector affecting creditors’ rights generally or general equitable principles, (i) each Lease is the Royale Parties legal, valid and their Subsidiaries binding obligation of the Subject Company party thereto and, to the Knowledge of ARC, each other party to such Lease and (ii) each Lease is enforceable against such Subject Company and, to the Knowledge of ARC, each other party to such Lease. (b) The Subject Companies own and have either good, valid and marketable title to or, in the case of leased property, good and valid title in fee leasehold interests in, or a valid leasehold interest, Right of Way otherwise will have full or other sufficient and legally enforceable rights to use, all of the landtangible properties, mineral assets and other subsurface rightsrights (real, buildingspersonal or mixed) used or held for use in connection with, structures and other improvements thereon and fixtures thereto necessary for the conduct of, or otherwise material to permit it to conduct its business as currently conductedthe operations of, the Business, in each case free and clear of all liens (except in all cases for any Lien other than Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected any failure to have such titles, interests or rights that would not, individually or in the aggregate, be materially adverse to the Business or the Subject Companies, in each case, taken as a Royale Material Adverse Effectwhole. Each Royale Party The Subject Companies have maintained in all material respects all tangible Assets in good repair, working order and its Subsidiaries has fulfilled operating condition, subject only to ordinary wear and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Waytear, except for such revocationsany failure to be in good repair, terminations and impairments working order or operating condition that have not had and would not reasonably not, individually or in the aggregate, be expected materially adverse to have a Royale Material Adverse Effect. All pipelines owned the Business or operated by the Royale Parties and their Subsidiaries are subject to Rights of WaySubject Companies, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising in each case, taken as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effectwhole. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effectfor the Deferred Assets and the Excluded Assets, the Royale Parties Contributed Assets and their Subsidiariesthe assets, properties and rights that will be owned, leased or licensed by Newco and the Transferred Entities immediately following the Closing will constitute all the material assets, properties and rights necessary to conduct the Business as applicable, have defensible title to all it is conducted as of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statementsdate hereof. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably Trailer Amounts contemplated to be expected distributed pursuant to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g5.02(c) of the Royale Disclosure Schedules, no Royale Party is engaged A&R Newco LLCA (other than asset management fees received in any oil, natural gas or other futures converted to cash by the ARC Member and its Subsidiaries on or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, prior to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale InterestsClosing Date) shall be Contributed Assets. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to Nauticler and the Horamar Entities have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries own and have either good and valid title to all of their respective properties, interests in fee properties and assets, real and personal, reflected on the Most Recent Balance Sheet or a acquired since the Most Recent Balance Sheet Date, or, in the case of leased properties and assets, valid leasehold interest, Right of Way or other rights to the land, mineral interests in such properties and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conductedassets, in each case free and clear of all liens Liens. (b) The Sellers Disclosure Schedule sets forth a true, complete and correct list of each parcel of real property owned or leased by Nauticler or any of the Horamar Entities. All leases for leased real property of Nauticler or any Horamar Entity are in full force and effect, are valid and effective in accordance with their respective terms except in all cases for Permitted Liens). Except as where any such failure would not reasonably be expected to have a Royale Horamar Material Adverse Effect, all leasesand there is not, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights any existing default or event of Way default (or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights event which with notice or the lapse of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allowstime, or after notice or lapse of time both, would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have constitute a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Waydefault) in the Rights of Way other than gaps that would not have and would not reasonably be expected give rise to have a Royale Material Adverse Effectmaterial claim. (c) Except as would not reasonably be expected to have a Royale Material Adverse EffectThe facilities, the Royale Parties property and their Subsidiariesequipment owned, as applicable, have defensible title to all leased or otherwise used by Nauticler or any of the Royale Interests forming the basis Horamar Entities are in a good state of maintenance and repair in accordance with market standards, and suitable for the reserves reflected in the Royale Financial Statements except purposes for such Royale Interests sold, which they are presently used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used tangible assets which are leased by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party Nauticler or any of the Horamar Entities have been maintained with the standards and specifications required by each such lease such that at each such termination of the lease such assets can be returned to their Subsidiaries are subject to owner without any further material penalties obligation on allowables because the part of overproduction Nauticler or violation any of any applicable Lawthe Horamar Entities with respect thereto. (e) All Royale Interests operated From and after the Closing Date, the tangible assets owned or leased by Nauticler or any Horamar Entity, together with its intangible assets are, when utilized by a labor force substantially similar to that employed by Nauticler and the Royale Parties Horamar Entities on the date hereof, adequate to conduct the business and their Subsidiaries have been operated in accordance with reasonable, prudent field practices operations of Nauticler and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative Horamar Entities as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Returncurrently conducted. (f) There are no material inaccuracies in The Sellers Disclosure Schedule lists all vessels, barges, river tankers, pushboats and ships owned, leased and/or operated by Nauticler and the report of NetherlandHoramar Entities (jointly, ▇▇▇▇▇▇ & Associatesthe “Horamar Vessels”) as well as their registration details, Inc. as of December 31country flag, 2015owner, and dated February 1lessor/ lessee (if applicable). Nauticler and the Horamar Entities are the registered owners, 2016. hold perfect and marketable title (gtítulo perfecto) Except as set forth on Section 5.10(g) free and clear of all Liens with respect to all Horamar Vessels which according to the Royale Sellers Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instrumentsSchedule are owned by Nauticler and/or the Horamar Entities. Section 5.10(g) of Nauticler and the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion Horamar Entities have complied with all obligations and there are no pending or, fulfilled all requirements needed to hold and maintain perfect and marketable title (título perfecto) free and clear of all Liens on all Horamar Vessels which according to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of Sellers Disclosure Schedule are owned by Nauticler and/or the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale InterestsHoramar Entities. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. SCHEDULE 4.15 hereto sets forth a complete and correct list of (a) Except as would not reasonably be expected all real property owned by the Company, (b) any lease pursuant to have a Royale Material Adverse Effect, which the Royale Parties Company is the lessee of real property and their Subsidiaries own and have either (c) each item of tangible personal property used in or relating to the conduct of the business of the Company that has been capitalized for accounting purposes. The Company has (a) good and valid title to all of its personal assets and property, including, without limitation, all those listed on SCHEDULE 4.15, reflected in fee the Interim Financials or a acquired after the date of the Interim Balance Sheet (except for inventories and other assets sold or otherwise disposed of in the Ordinary Course of Business since such date), and (b) good and marketable title to all the real property listed in SCHEDULE 4.15 as owned by it, and valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business interests in all real properties listed in SCHEDULE 4.15 as currently conductedleased by it, in each case free and clear of all liens Encumbrances other than (except i) those reflected in all cases for Permitted Liens). Except the Interim Financials or listed in SCHEDULE 4.15 and (ii) those which do not, individually or in the aggregate, (x) materially interfere with the operation of its business as would not presently conducted or (y) otherwise have, or could reasonably be expected to have have, a Royale Material Adverse Effect, . The Company enjoys peaceful and undisturbed possession under all leases, Rights of Way or other agreements real property leases under which any Royale Party it operates. The Company has not received written notice that the ownership or any lease of their Subsidiaries lease, access or use any real property are validby the Company and the use thereof, binding and are in force and effect against as presently used by the Royale Parties Company, violates any local zoning or similar land use laws or governmental regulations. The Company has not received written notice of violation of or noncompliance with any covenant, condition, restriction, order or easement affecting the real property owned or leased by the Company. The Company has not received written notice of their Subsidiaries and, condemnation or threatened condemnation affecting the real property owned or leased by it. The Company has made available to the Knowledge Purchaser complete and correct copies of each Royale Partythe lease agreements referred to in SCHEDULE 4.15. The personal property, equipment, plants, buildings, structures, facilities and all other assets and properties that will be owned or leased by the counterparties theretoCompany after the Closing Date will include all personal property, in accordance with their respective termsequipment, plants, buildings, structures, facilities and neither all other assets and properties necessary to permit the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient Company to conduct its business as currently presently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries changes as are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable LawSECTION 6.2. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to The Company and the Company Subsidiaries have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries own and have either good and valid title to, or in fee or a the case of leased property and leased tangible assets, valid leasehold interestinterests in, Right all of Way its material real properties and tangible assets. All such material assets and real properties, other than assets and real properties in which the Company or other rights to any of the landCompany Subsidiaries has leasehold interests, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case are free and clear of all liens (Liens, except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries Neither the Company nor any Company Subsidiary owns or, since January 1, 2005, has such Rights of Way from each person as are sufficient to conduct its business as currently conductedowned, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effectreal property. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c3.18(c) of the Royale Company Disclosure SchedulesSchedule sets forth, as of the date of this Agreement, (i) none a true and complete list of all real property leased, subleased or otherwise occupied by the proceeds from Company or any Company Subsidiary (collectively, the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason“Leased Real Property”), and (ii) there are no calls on production the location for each Leased Real Property, (iii) the current rent amounts payable by the Company or preferential rights any Company Subsidiary related to purchase Hydrocarbons each Leased Real Property and (iv) the Royale Parties nor expiration date of the Lease Agreement related to such Leased Real Property. No Lease Agreement is subject to any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (Lien other than gas balancing arrangements)Permitted Liens. No person other than the Company or a Company Subsidiary has any right (whether by lease, except for the rights of sublease, license or otherwise) to use or occupy all or any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms portion of the applicable Contract or as reserved against in the Royale Financial StatementsLeased Real Property. (d) All The Company and the Company Subsidiaries have a valid and existing interest in the Leased Real Property, and the Company and the Company Subsidiaries enjoy peaceful and undisturbed possession of the ▇▇▇▇▇ owned, leased, operated or Leased Real Property. The Leased Real Property constitutes all of the real property used by the Royale Parties Company and their the Company Subsidiaries in the operation of the business of the Company and all waterthe Company Subsidiaries. Neither the Company nor any Company Subsidiary has received any written notice from any Governmental Entity with respect to the ownership, carbon dioxide lease, occupancy or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by use of the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as Leased Real Property that would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party materially and adversely affect the rights of the Company or any of their Subsidiaries are subject to Company Subsidiary or constitute a material penalties on allowables because of overproduction or violation of Laws applicable to the Leased Real Property. Neither the Company nor any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated Company Subsidiary has received written notice of any proceedings in accordance with reasonableeminent domain, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None condemnation or other similar proceedings that are pending or threatened affecting any portion of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax ReturnLeased Real Property. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Material Adverse Effect, Neither the Royale Parties and their Subsidiaries own and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties Company nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effectowns any real property. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c4.18(a) of the Royale Company Disclosure Schedules, (i) none of Letter sets forth the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense address for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or leased property used by the Royale Parties Company or its Subsidiaries (the “Leased Real Property”). The Company has delivered or made available to Parent a correct and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) complete copy of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse EffectLeases. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j4.18(a) of the Royale Company Disclosure SchedulesLetter, none with respect to each of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision Leases: (i) requiring the lessee there are no material disputes with respect to pay royalties on ▇▇▇▇▇▇, such Lease; (ii) causing the oil, gas no security deposit or mineral lease portion thereof deposited with respect such Lease has been applied in respect of a breach or contract to terminate without advance notice and the opportunity to cure resulting default under such Lease that has not been redeposited in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, full; (iii) requiring lessorneither the Company or any of its Subsidiaries owes, nor will they owe in the future, any material brokerage commissions or finder’s consent fees with respect to the consummation of the transactions of the type contemplated under this Agreement, or such Lease; (iv) is expected the Company and its Subsidiaries have not subleased, licensed or otherwise granted any Person the right to result use or occupy such Leased Real Property or any portion thereof; (v) the Company and its Subsidiaries have not collaterally assigned or granted any other material security interest in a mandatory payment such Lease or expenditure not otherwise disclosed any interest therein; and (vi) there are no material Liens, except for Permitted Liens, on the estate or interest created by such Lease. (b) The Company and its Subsidiaries have, and at the Effective Time will have, good and valid title to, or valid rights to use, all material assets and properties (in Section 5.10(ieach case, tangible and intangible) of necessary to permit the Royale Disclosure SchedulesCompany and its Subsidiaries to conduct their business as currently conducted.

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries own and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party The Company and its Subsidiaries has have good record and marketable fee title to (or, in the case of licensed Property, valid licenses to) all real Property and all other Property and assets, whether tangible or intangible, owned by or licensed to them and reasonably necessary in the conduct of business of the Company or such Rights of Way from each person as are sufficient to conduct its business as currently conductedSubsidiaries, except for such Rights of Way the absence of defects in title which have do not had and would will not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by of the Royale Parties leases necessary in any material respect for the operation of their respective properties and their Subsidiaries are subject to Rights of Wayassets, there are no encroachments or other encumbrances on under which the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party Company or any of their its Subsidiaries holds any Property or assets, real or personal, are valid, subsisting and enforceable and afford peaceful and undisturbed possession of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all subject matter of the Royale Interests forming lease, and no material default by the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out Company or otherwise disposed any of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) its Subsidiaries exists under any of the Royale Disclosure Schedulesprovisions thereof. All buildings, (i) none machinery and equipment of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, Company and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their its Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements)good repair and working order, except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except ordinary wear and tear, and except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated All material current and proposed uses of such Property or used by any Royale Party or any assets of their the Company and its Subsidiaries are subject to material penalties on allowables because permitted as of overproduction right and no regulation or violation ordinance interferes with such current or proposed uses. To the knowledge of the Company, there is no pending or formally proposed change in any applicable Law. (e) All Royale Interests operated by the Royale Parties such laws, regulations and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate ordinances which would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure SchedulesSCHEDULE 4.21, none no condemnation proceeding is pending or, to the knowledge of the Royale Interests are subject to Company, threatened against the Company or any Tax partnership agreement of its Subsidiaries. All Property and assets of any kind (real or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherlandpersonal, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(gtangible or intangible) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of Company and its Subsidiaries are free from all Liens except for (a) Liens which it has any material future liability, nor is any Royale Party would not have a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(gMaterial Adverse Effect; (b) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future Liens disclosed on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value thereforSCHEDULE 4.21 hereto; and (c) Permitted Liens. Except as set forth on Section 5.10(g) SCHEDULE 4.21 hereto, neither the Company nor any of the Royale Disclosure Schedulesits Subsidiaries has signed any material financing statement, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option debtor or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbonslessee, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, any security agreement authorizing any secured party thereunder to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under file any such Contractfinancing statement. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except Section 3.15(a) of the Company Disclosure Letter sets forth the address and parcel number of each parcel of real property owned by the Company or any of its Subsidiaries (collectively, the “Owned Real Property”). The Company or one of its Subsidiaries has good and marketable fee simple title to the Owned Real Property and to all of the buildings, structures and other improvements thereon free and clear of all Liens other than Permitted Liens. Neither the Company nor any of its Subsidiaries has leased, licensed or otherwise granted any person the right to use or occupy the Owned Real Property which lease, license or grant is currently in effect or collaterally assigned or granted any other security interest (other than Permitted Liens) in the Owned Real Property which assignment or security interest is currently in effect. There are no outstanding agreements, options, rights of first offer or rights of first refusal on the part of any party to purchase any Owned Real Property. (b) Section 3.15(b) of the Company Disclosure Letter sets forth a list by address, tenant, landlord and date of lease of all leases, subleases, licenses and similar agreements and all amendments thereto (each such lease, sublease, license or similar agreement and all amendments thereto, being a “Lease”) of all leasehold or subleasehold estates held by or for the Company or its Subsidiaries (the “Leased Real Property; and, collectively with the Owned Real Property, the “Real Property”). Section 3.15(b) of the Company Disclosure Letter sets forth all sublicenses, licenses and other grants by the Company or any of its Subsidiaries to any person of the right to use or occupy such Leased Real Property or any portion thereof involving, in any such case, payments of more than $100,000 annually. The Company has a good and valid leasehold interest in and to the Leased Real Property, subject to no Liens, except Permitted Liens. Each Lease is in full force and effect except as would not reasonably be expected to have a Royale Material Adverse Effect. There exists no material default by or condition caused by the Company, or to Knowledge of Company, any other parties, which with the giving of notice, the Royale Parties passage of time or both could become a material default under any Lease. True and their complete copies of all Leases have been made available to Parent. (c) The Company and each of its Subsidiaries own and have either has such good and valid title to, or such valid rights by lease, license, other agreement or otherwise to use, all assets and properties (in fee or a valid leasehold interesteach case, Right of Way or other rights to the land, mineral tangible and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto intangible) necessary to permit it enable the Company and its Subsidiaries to conduct its their business as currently conducted, except where the failure to have such good and valid title or valid rights would not, individually or in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not the aggregate, reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to The Company and its Subsidiaries have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries own and have either good and valid title to all of their respective properties, interests in fee properties and assets, real and personal, reflected on the Most Recent Balance Sheet or a acquired since the Most Recent Balance Sheet Date, or, in the case of leased properties and assets, valid leasehold interest, Right of Way or other rights to the land, mineral interests in such properties and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conductedassets, in each case free and clear of all liens Liens except for: (except i) Liens reflected in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effectthe Company Financial Statements, all leases(ii) Liens consisting of zoning or planning restrictions, Rights easements, permits and other restrictions or limitations on the use of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property or irregularities in title thereto which do not materially detract from the value of, or materially impair the use of, such property as it is presently used, (iii) Liens for current Taxes, assessments or governmental charges or levies on property not yet due or which are valid, binding being contested in good faith and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, for which appropriate reserves in accordance with their respective termsGAAP have been created, (iv) mechanic's, materialmen's and neither similar Liens arising in the Royale Parties nor ordinary course of business or by operation of law and (v) any conditions that are shown on the surveys previously delivered to Parent of their Subsidiaries are in default under any such leasesreal property (collectively, Rights of Way or other agreements"Permitted Liens"). (b) Section 2.16(b) of the Company Disclosure Schedule sets forth a true, complete and correct list of all real property owned or leased by the Company or any of its Subsidiaries. Each Royale Party of the Company and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed is in compliance in all its obligations material respects with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of all leases for real property to which it is a party. Neither the Company nor any Rights of Way) in its Subsidiaries is a party to any lease, assignment or similar arrangement under which the Rights Company or any Subsidiary is a lessor, assignor or otherwise makes available for use by any third party any portion of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effectthe owned or leased real property. (c) Except as would not reasonably be expected The facilities, property and equipment owned, leased or otherwise used by the Company or any of its Subsidiaries are in a good state of maintenance and repair, free from material defects and in good operating condition (subject to have a Royale Material Adverse Effectnormal wear and tear), the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis suitable for the reserves reflected in the Royale Financial Statements except purposes for such Royale Interests sold, which they are presently used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used tangible assets which are leased by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party Company or any of its Subsidiaries have been maintained with the manufacturers' standards and specifications required by each such lease such that at each such termination of the lease such assets can be returned to their owner without any further material obligation on the part of the Company or any of its Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Lawwith respect thereto. (e) All Royale Interests operated by From and after the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the TransactionsEffective Time, except for any such preferential purchasethe Company employees, consent with respect to which the Company makes no representation, the tangible assets owned or similar rights that would not leased by the Surviving Corporation, together with its intangible assets will constitute those assets reasonably be expected required to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none operate the business and operations of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax ReturnCompany and its Subsidiaries as currently conducted in all material respects. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g2.16(f) of the Royale Company Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules Schedule sets forth obligations a list of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, all leased real property that is as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment be by the Effective Time, vacant or expenditure not otherwise disclosed in Substantially Vacant (as defined below). Section 5.10(i2.16(f) of the Royale Company Disclosure SchedulesSchedule includes: (i) the total number of square feet leased pursuant to each such lease; (ii) the number of square feet so leased that is vacant or otherwise not utilized pursuant to each such lease; and (iii) the aggregate lease payments due from the date hereof through the expected termination of each such lease. For purposes of this Section 2.16(f), "Substantially Vacant" shall mean that more than 25% of the square footage subject to such lease is or is expected to be vacant or unutilized.

Properties and Assets. (a) Except as Section 3.14(a) of the Company Disclosure Schedule lists all real property currently owned in fee simple (or the equivalent under applicable Law) by an Acquired Company (the “Owned Real Property”) and identifies for each the owner, location (including street address) and principal uses thereof. (b) Section 3.14(b) of the Company Disclosure Schedule lists all material real property currently leased by an Acquired Company (the “Leased Real Property,” and together with the Owned Real Property, the “Company Real Property”) and identifies for each the lessee, lessor, location (including street address) and principal uses thereof. The Company has made available to Parent correct and complete copies of each Contract relating to the Leased Real Property (including any and all modifications, supplements and amendments thereto and any and all renewals or extensions thereof, each a “Lease”). Each Lease is the legal, valid, binding, and enforceable obligation of the Acquired Company that is lessee thereunder, and, to the Company’s knowledge, the Lease is in full force and effect and the binding obligation of the other parties thereto and will continue to be the legal, valid, binding, and enforceable obligation of the applicable Acquired Company following the Closing. No Acquired Company has received any written notice that it is in material Breach under any Lease (which Breach has not been cured), and to the Company’s knowledge no Acquired Company or any other party to such Lease is in material Breach under any such Lease, and, subject to receipt of the Consents listed in Section 3.3(e) of the Company Disclosure Schedule, no event has occurred, which, after the giving of notice, with lapse of time, or otherwise, would constitute a material Breach by an Acquired Company or, to the Company’s knowledge, any other party under such Lease. (c) With respect to each parcel of Company Real Property: (i) an Acquired Company holds good and marketable fee simple (or the equivalent under applicable Law) title to, or, with respect to the Leased Real Property, a valid leasehold interest in, the parcel (and, with respect to each parcel of Owned Real Property, all buildings, structures, fixtures and improvements thereon), free and clear of any Encumbrances other than Permitted Encumbrances; (ii) except for Permitted Encumbrances, no Acquired Company has leased, subleased or otherwise granted to any Third Party any right to occupy or use the parcel or any material portion thereof and, with respect to the Owned Real Property, there are no outstanding options or rights of first refusal to purchase the parcel or any portion thereof or interest therein; (iii) to the Company’s knowledge, there are no facts, circumstances or conditions that have materially interfered, or would reasonably be expected to materially interfere, with the current or currently proposed uses of the parcel; (iv) there are no pending or, to the Company’s knowledge, threatened condemnation, zoning or other Proceedings; and (v) the parcel is being used and occupied in compliance with all applicable Laws, except for Breaches the consequences of which would not reasonably be expected to have a Royale Material Adverse Effectto, individually or in the Royale Parties and their Subsidiaries own and have either aggregate, materially interfere with the occupation or use of such parcel as currently occupied or used by an Acquired Company. (d) An Acquired Company has good and valid marketable title in fee to, or a valid leasehold interestinterest in, Right of Way or other rights to the landall material machinery, mineral equipment and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conductedtangible assets used by the Acquired Companies or which are reflected in the Latest Company Balance Sheet or acquired after the date thereof, in each case free and clear of all liens (except in all cases for any Encumbrances other than Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conductedEncumbrances, except for such Rights assets and properties disposed of Way in the absence Ordinary Course of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any Business or as otherwise permitted under this Agreement since the date of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse EffectLatest Company Balance Sheet. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Material Adverse Effect, The Seller is the Royale Parties legal and their Subsidiaries own and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any beneficial owner of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps Purchased Assets (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (cthe Owned Real Property) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible with good title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of businessthereto, free and clear of all liens and Production Burdens Liens other than Production Burdens not yet earned, due Permitted Liens. No other Person owns any assets which are being used in the Operations except for the Leased Real Properties and personal or payable moveable property leased to the Seller pursuant to the Material Contracts. (b) Section 3.1(31)(b) of the Disclosure Letter identifies for each Owned Real Property its registered and Permitted Liens (other than Production Burdens). Except beneficial owner and except as would not reasonably be expected material to have the Operations, such registered and beneficial owners own the Owned Real Property in such capacity, free and clear of all Liens other than the Permitted Liens. (c) The interests in each lease, sublease, license and other agreement under which the Seller uses or occupies or has the right to use or occupy the real or immovable property are set forth in Section 3.1(31)(c) of the Disclosure Letter (such property subject to a Royale Material Adverse Effect lease, sublease or other agreement, the “Leased Real Property” and such leases, subleases and other agreements are, collectively, the “Real Property Leases”). The Real Property Leases are valid and binding on the Seller and, to the knowledge of the Seller, on each other party thereto, and in full force and effect and other than as set forth on in Section 5.10(c3.1(31)(c) of the Royale Disclosure SchedulesLetter, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights consents required in order to purchase Hydrocarbons assign the Seller’s right, title and the Royale Parties nor interest in any of their Subsidiaries are the Real Property Leases. The Seller is not obligated to deliver Hydrocarbons in material breach or proceeds from default under any Real Property Lease, nor does the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights Seller have knowledge of any lessor to take free gas under condition that with the terms passage of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law time or the terms giving of notice or both would result in such a material breach or default. To the knowledge of the applicable Contract Seller, there is no material breach or as reserved against default under, nor does there exist any condition that with the passage of time or the giving of notice or both would result in the Royale Financial Statementssuch a breach or default by any other party thereto. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, Except as would not reasonably be expected material to have the Operations, there are no leases, subleases, licenses, rights or other agreements affecting the Owned Real Property or, other than the Real Property Leases, the Leased Real Property. The Seller is currently not leasing, subleasing, licensing or otherwise granting any person the right to use or occupy any portion of an Owned Real Property or a Royale Material Adverse EffectLeased Real Property. No well owned, leased, operated There are no outstanding options or used by rights of first refusal in favour of any Royale Party other party to purchase any Owned Real Property or any of their Subsidiaries are subject to material penalties on allowables because of overproduction portion thereof or violation of any applicable Lawinterest therein. (e) All Royale Interests operated Since November 17, 2017, there has been no off-title transfer of the ownership of the Owned Real Property located in Québec by the Royale Parties and their Subsidiaries Seller which would have been operated in accordance with reasonable, prudent field practices and in compliance with triggered the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None payment of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax ReturnTransfer Taxes. (f) There are no material inaccuracies in the report All municipal taxes, rates, levies and assessments of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas every nature or other futures or option trading kind in respect of which it has the Owned Real Property and the Leased Real Property for the calendar year 2019 and all preceding calendar years have been paid in full or will be reflected in the Statement of Adjustments, and the Seller does not have any material future liability, nor is any Royale Party a party overdue obligation to pay moneys to any price swapsGovernmental Entity in connection with services, ▇▇▇▇▇▇utilities or the like, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring Owned Real Property or the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure SchedulesLeased Real Property.

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Material Adverse EffectOther than properties and assets disposed of by the Company in the ordinary course of business since the Most Recent Balance Sheet Date, the Royale Parties and their Subsidiaries own and have either Company has good and valid title to all of its properties and assets, real and personal, reflected on the Most Recent Balance Sheet or acquired since the Most Recent Balance Sheet Date, or, in fee or a the case of leased properties and assets, valid leasehold interestinterests in such properties and assets, Right of Way except where the failure to have such good and valid title to, or other rights to the landvalid leasehold interests in, mineral has not had and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not be reasonably be expected likely to have have, individually or in the aggregate, a Royale Company Material Adverse Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party Section 2.16(b) of the Company Disclosure Schedule sets forth a complete and correct list of each parcel of real property ever owned or leased by the Company as of the date of this Agreement and material to the conduct of the business of the Company, taken as a whole (the material leases pursuant to which the Company is a tenant of any such real property being hereinafter referred to as the “Leases”). As of the date of this Agreement, (i) the Leases are in full force and effect in accordance with their terms and (ii) the Company is not in default of any of its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conductedobligations under the Leases, except for where such Rights of Way the absence of which have default has not had and would not be reasonably be expected likely to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Wayhave, and no event has occurred that allows, individually or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have aggregate, a Royale Company Material Adverse Effect. (c) Except The facilities, property and equipment owned, leased or otherwise used by the Company are in a good state of maintenance and repair, free from material defects and in good operating condition (subject to normal wear and tear), and suitable for the purposes for which they are presently used, except in each case as has not had and would not be reasonably be expected likely to have have, individually or in the aggregate, a Royale Company Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Section 4.15(a) of the Company Disclosure Letter sets forth the address or other description of each parcel of real property owned by the Company or its Subsidiaries (collectively, the “Owned Real Property”). Except as would not reasonably be expected set forth in Section 4.15(a) of the Company Disclosure Letter and subject to have a Royale Material Adverse Effectany Permitted Liens, (i) the Royale Parties and their Company or one of its Subsidiaries own and have either has good and valid merchantable title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral Owned Real Property and other subsurface rights, to all of the buildings, structures and other improvements thereon located thereon, (ii) the Company and fixtures thereto necessary to permit it to conduct its business as currently conductedSubsidiaries have not leased, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries andlicensed or, to the Knowledge knowledge of each Royale Partythe Company, otherwise granted any Person the counterparties thereto, right to use or occupy such Owned Real Property or any portion thereof and (iii) the Company and its Subsidiaries have not collaterally assigned or granted any other security interest in accordance with their respective terms, such Owned Real Property. The Owned Real Property constitutes all of the real property owned by the Company and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreementsits Subsidiaries. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c4.15(b) of the Royale Company Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure SchedulesLetter lists, as of the date hereof, no Royale Party is bound each parcel of all leasehold or subleasehold estates and other rights to use or occupy any land, buildings or structures used by futures, hedge, swap, collar, put, call, floor, cap, option the Company or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations its Subsidiaries in the price course of commoditiestheir respective businesses (the “Leased Real Property”). Prior to the date hereof, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) the Company has made available to Parent a true and complete schedule of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Leases. Except as set forth in Section 5.10(j4.15(b) of the Royale Company Disclosure SchedulesLetter or as, none of individually or in the Contracts relating aggregate, would not reasonably be likely to have a Material Adverse Effect on the Royale Interests (including all oilCompany, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee Company and its Subsidiaries have not subleased or licensed to pay royalties on ▇▇▇▇▇▇any Person the right to use or occupy such Leased Real Property or any portion thereof, (ii) causing to the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any knowledge of the Royale Interests for lessee’s failure Company, there are no disputes with respect to pay royalties or for lessee’s breach of any covenant thereundersuch Lease, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, Company and its Subsidiaries have not collaterally assigned or granted any other security interest in such Lease or any interest therein and (iv) there are no Liens, except for Permitted Liens, on the estate or interest created by such Lease. (c) Since January 1, 2001 through the date hereof, (i) no written notice from any Governmental Authority has been received by the Company or any of its Subsidiaries requiring or calling attention to the need for any material work, repair, construction, alteration or installation on, or in connection with, the Owned Real Property or the Leased Real Property, and (ii) no material assessment for public improvement that is expected due and remains unpaid has been made against any Owned Real Property or Leased Real Property and, to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) the knowledge of the Royale Disclosure SchedulesCompany, there are no currently proposed or pending assessments for public improvements against any Owned Real Property or Leased Real Property. (d) The Company and its Subsidiaries have good title to their owned assets, or in the case of assets and properties that they lease, license or have other rights in, valid rights by lease, license or other agreement to use, all assets and properties (in each case, tangible and intangible) necessary to permit the Company and its Subsidiaries to conduct their business as currently conducted, except where the failure to have such title, or rights by lease, license, or other agreement to use would not reasonably be likely to have a Material Adverse Effect on the Company. The assets and properties (in each case, tangible and intangible) owned or used by the Company and its Subsidiaries are in satisfactory condition and repair for their continued use as they have been used and are adequate in all material respects for their current use, reasonable wear and tear excepted, except where the failure to be in satisfactory condition and repair would not reasonably be likely to have a Material Adverse Effect on the Company.

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Material Adverse Effect, Neither the Royale Parties and their Subsidiaries own and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties Company nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effectowns any real property. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c4.18(a) of the Royale Company Disclosure Schedules, (i) none of Letter sets forth the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense address for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or leased property used by the Royale Parties Company or its Subsidiaries (the "Leased Real Property"). The Company has delivered or made available to Parent a correct and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) complete copy of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse EffectLeases. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j4.18(a) of the Royale Company Disclosure SchedulesLetter, none with respect to each of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision Leases: (i) requiring the lessee there are no material disputes with respect to pay royalties on ▇▇▇▇▇▇, such Lease; (ii) causing the oil, gas no security deposit or mineral lease portion thereof deposited with respect such Lease has been applied in respect of a breach or contract to terminate without advance notice and the opportunity to cure resulting default under such Lease that has not been redeposited in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, full; (iii) requiring lessor’s consent neither the Company or any of its Subsidiaries owes, nor will they owe in the future, any material brokerage commissions or finder's fees with respect to the consummation of the transactions of the type contemplated under this Agreement, or such Lease; (iv) is expected the Company and its Subsidiaries have not subleased, licensed or otherwise granted any Person the right to result use or occupy such Leased Real Property or any portion thereof; (v) the Company and its Subsidiaries have not collaterally assigned or granted any other material security interest in a mandatory payment such Lease or expenditure not otherwise disclosed any interest therein; and (vi) there are no material Liens, except for Permitted Liens, on the estate or interest created by such Lease. (b) The Company and its Subsidiaries have, and at the Effective Time will have, good and valid title to, or valid rights to use, all material assets and properties (in Section 5.10(ieach case, tangible and intangible) of necessary to permit the Royale Disclosure SchedulesCompany and its Subsidiaries to conduct their business as currently conducted.

Properties and Assets. (a) Except Other than properties and assets disposed of by the Company and its Subsidiaries in the ordinary course of business since the Most Recent Balance Sheet Date, the Company and its Subsidiaries have good and valid title to all of their respective material properties, interests in properties and assets, real and personal, reflected on the Most Recent Balance Sheet or acquired since the Most Recent Balance Sheet Date, or, in the case of material leased properties and assets, valid leasehold interests in such properties and assets, in each case free and clean of all Liens, except in each case in this Section 2.17(a) as would not reasonably be expected to have a Royale Company Material Adverse Effect, . (b) Section 2.17(b) of the Royale Parties Company Disclosure Schedule sets forth a complete and their correct list of each parcel of real property ever owned or leased by the Company or any of its Subsidiaries own as of the date of this Agreement and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights material to the landconduct of the business of the Company and its Subsidiaries, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary taken as a whole (the material leases pursuant to permit it which the Company or any of its Subsidiaries is a tenant of any such real property being hereinafter referred to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liensthe “Leases”). Except As of the date of this Agreement, except as would not reasonably be expected to have a Royale Company Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and Adverse Effect (i) the Leases are in full force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither ; (ii) the Royale Parties nor Company is not in default of any of their Subsidiaries its obligations under the Leases; and (iii) to the knowledge of the Company, the landlords under the Leases are not in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of landlords’ obligations under the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse EffectLeases. (c) Except as would not reasonably be expected to have a Royale Company Material Adverse Effect, the Royale Parties facilities, property and their Subsidiariesequipment owned, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out leased or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party Company or any of their its Subsidiaries are in a good state of maintenance and repair, free from material defects and in good operating condition (subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties normal war and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015tear), and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party suitable for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that purposes for which they are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securitiespresently used. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Material Adverse EffectThe Company has good, the Royale Parties valid, marketable and their Subsidiaries own and have either good and valid fee simple title in fee to, or a valid leasehold interestinterest in, Right all of Way the real property owned or other rights to leased by the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business Company as currently conducted, in each case free and clear more particularly described on Schedule 2.12(a)-1 of all liens the Disclosure Schedule (except in all cases for Permitted Liensthe "Real Property"). Except as would not reasonably be expected and to have a Royale Material Effectthe extent set forth on Schedule 2.12(a)-2 of the Disclosure Schedule, all leasesthe Real Property owned or, Rights in respect of Way or other agreements under which any Royale Party or any of their Subsidiaries leasethe Real Property leased by the Company, access its leasehold interest, is subject to no Encumbrance, encroachment, building or use any real property are validrestriction, binding and are in force and effect against the Royale Parties zoning violation, exception, reservation or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreementslimitation. (b) Each Royale Party Except as and its Subsidiaries has such Rights to the extent set forth on Schedule 2.12(b)-1 of Way from each person as are sufficient to conduct its business as currently conductedthe Disclosure Schedule, except for such Rights of Way the absence of which Company and the Seller have not had and would not reasonably be expected received any written notice advising them of any general or special assessment relating to have a Royale Material Adverse Effectthe Real Property. Each Royale Party and its Subsidiaries There are no condemnation or eminent domain proceedings pending (for which written notice has fulfilled and performed all its obligations with respect been provided to such Rights the Company or the Seller) or, to the knowledge of Way and conducts their business in a manner that does not violate any those Persons identified on Schedule 2.12(b)-2 of the Rights Disclosure Schedule, threatened, against the Real Property by any Governmental Authority. There are no variances, special exceptions, conditions or agreements pertaining to the Real Property imposed or granted by or entered into by the Company with, or, to the knowledge of Waythose Persons identified on Schedule 2.12(b)-3 of the Disclosure Schedule, enforceable by, any Governmental Authority. Except as and to the extent set forth on Schedule 2.12(b)-4 of the Disclosure Schedule, no event written notice from any Governmental Authority has occurred that allowsbeen provided to the Company or the Seller requiring or calling attention to the need for any work, repair, construction, alteration or installation on, or after notice or lapse in connection with, the Real Property. To the knowledge of time would allow, revocation or termination thereof or would result in any impairment those Persons identified on Schedule 2.12(b)-5 of the rights Disclosure Schedule, the current operations of the holder of Company are permitted uses under applicable zoning regulations and there is no requirement for any such Rights of Wayspecial exception, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments variance or other encumbrances on conditional approval to permit the Rights of Way that affect Company to continue to operate at the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of respective locations where the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse EffectCompany currently operates. (c) Except as would not reasonably be expected and to have a Royale Material Adverse Effectthe extent set forth in Items 3, 4 and 5 on Schedule 2.12(c)-1, the Royale Parties Company has good, valid and their Subsidiariesmarketable title to, or a valid leasehold interest in, all items of personal property, buildings, improvements, equipment and all other assets and properties (whether personal or mixed, tangible or intangible (and whether or not fully depreciated, amortized or expensed)) used in the Business, and such items are subject to no Encumbrance except as applicable, have defensible title and to all the extent set forth in Items 1 and 2 on Schedule 2.12(c)-1 of the Royale Interests forming Disclosure Schedule. All buildings, improvements, equipment or other material assets currently used in connection with the basis business and operations of the Company are structurally sound, and to the knowledge of those Persons identified on Schedule 2.12(c)-2 of the Disclosure Schedule, contain no material defects. Such buildings, improvements, equipment and other material assets are suitable for the reserves reflected in the Royale Financial Statements except their intended use and are subject to no commitment or other arrangement for such Royale Interests sold, used, farmed out their sale or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens)use by any third party. Except as would not reasonably be expected and to have a Royale Material Adverse Effect or as the extent set forth on Section 5.10(c) Schedule 2.12(c)-3 of the Royale Disclosure SchedulesSchedule and except for the Inventory, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) Company's tangible assets are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms possession of the applicable Contract or as reserved against in the Royale Financial Statementsothers. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as and to the extent set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(gSchedule 2.12(d) of the Royale Disclosure SchedulesSchedule, no Royale Party is engaged in any oil, natural gas or the equipment and other futures or option trading in respect items of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) tangible personal property of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests Company are in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securitiesgood and normal operating condition and repair (ordinary wear and tear excepted). (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries subsidiaries own and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such consents, easements, rights of way, permits and licenses (collectively, “Rights of Way Way”) from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its material obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that materially affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇w▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇w▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇w▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇S▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇h▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇h▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i5.10(j) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries own and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (ci) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c5.10(c)(i) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (dii) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (eiii) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e5.10(c)(iii) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (fd) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (ge) Except as set forth on Section 5.10(g5.10(e) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g5.10(e) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g5.10(e) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (hf) Except as provided in Section 5.10(h5.10(f) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (ig) Except as set forth on Section 5.10(i5.10(g) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (jh) Except as set forth in Section 5.10(j5.10(h) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i4.10(g) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except The Company has good and valid title to, or a valid leasehold interest in, all the properties and assets which it purports to own or lease (real, tangible, personal and mixed), including all the properties and assets reflected in the Company Balance Sheet (except for personal property sold since the Company Balance Sheet Date in the ordinary course of business consistent with past practice). All properties and assets reflected in the Company Balance Sheet are free and clear of all Liens. (b) Section 4.20 of the Company Disclosure Schedule sets forth a true, complete and correct list of all real property owned, leased, subleased or licensed by the Company and the location of such premises. All material real property leases, licenses or other occupancy agreements to which the Company is a party (collectively, the “Company Real Property Leases”) are either filed as exhibits to the Company SEC Reports or complete copies thereof have been delivered to or made available to Parent. Section 4.20 of the Company Disclosure Schedule lists all Company Real Property Leases other than the Company Real Property Leases that are listed as an exhibit to the Company 10-K or a subsequent quarterly report on Form 10-Q. (i) All Company Real Property Leases are in full force and effect (except as such enforceability may be subject to Laws of general application relating to bankruptcy, insolvency and the relief of debtors and rules of Law governing specific performance, injunctive relief or other equitable remedies), (ii) there is no existing default by the Company under any of the Company Real Property Leases, except such defaults as have been waived in writing, (iii) no event has occurred with respect to the Company which, with notice or lapse of time or both, would constitute a default of any of the Company Real Property Leases, and (iv) to the Company’s Knowledge, there are no defaults of any obligations of any party other than the Company under any Company Real Property Lease, except in the cases of clauses (i) through (iv) for such defaults as would not reasonably be expected to have a Royale Material Adverse Effecthave, the Royale Parties and their Subsidiaries own and have either good and valid title in fee individually or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have aggregate, a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial StatementsCompany. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to Graphite and its Subsidiaries have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries own and have either good and valid marketable title in fee or a to, valid leasehold interestinterests in, Right of Way or other rights the legal right to the landuse, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case hold free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material EffectLiens and Encumbrances, all leasesof the assets, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding properties and are leasehold interests reflected in force and effect against the Royale Parties or any of their Subsidiaries and, to Financial Statements (the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted"Assets"), except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out those sold or otherwise disposed of since December 31, 2015, the date of the Financial Statements in the ordinary course of businessbusiness consistent with past practice and not in violation of this Agreement. All Assets of Graphite and its Subsidiaries that are used in the operations of their respective businesses are in good operating condition and repair, free subject to normal wear and clear tear. Graphite and its Subsidiaries have delivered to BPK or otherwise made available, correct and complete copies of all liens leases, subleases and Production Burdens other than Production Burdens not yet earnedmaterial agreements or other material instruments relating to all real property used in conducting the businesses of Graphite and the Subsidiaries to which Graphite or the Subsidiaries is a party (collectively, due or payable and Permitted Liens (other than Production Burdensthe "Real Property"), all of which are identified on Schedule 3.7. Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there There are no calls on production or preferential rights pending or, to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party Graphite's or any of their Subsidiaries are subject the Subsidiaries' knowledge, threatened condemnation proceedings relating to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse EffectReal Property. Except as set forth on Section 5.10(e) of Royale Disclosure SchedulesSchedule 3.7, none of the Royale Interests are real property improvements (including leasehold improvements), equipment and other Assets owned or used by Graphite or its Subsidiaries is subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas commitment or other futures arrangement for their sale or option trading in respect use by any Affiliate of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures Graphite or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbonsits Subsidiaries, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to by third parties. To the Knowledge of each Royale PartyPrincipal Shareholder, expected proposals the leased real estate is free and clear of any zoning or elections for drilling, completing, recompleting, reworking, facilities use or similar activities that would require such commitment on behalf of the Royale Parties building restriction or any of their Subsidiaries within one year of pending, proposed or threatened zoning or use or building restriction which would interfere with the Royale Merger Effective Time in any of the Royale Interests present or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for intended use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, by Graphite of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereundersuch leased real estate. Said leases are valid and binding and in full force and effect, (iii) requiring lessor’s consent and Graphite is not in default thereunder as to the payment of rent or otherwise. The consummation of the transactions contemplated by this Agreement will not constitute an event of default under any of said leases and the type continuation, validity and effectiveness of such leases will not be adversely affected by the transactions contemplated under by this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries own and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party The Company and its Subsidiaries has have good --------------------- record and marketable fee title to (or, in the case of licensed Property, valid licenses to) all real Property and all other Property and assets, whether tangible or intangible, owned by them and reasonably necessary in the conduct of business of the Company or such Rights of Way from each person as are sufficient to conduct its business as currently conductedSubsidiaries, except for such Rights of Way the absence of defects in title which have do not had and would will not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by of the Royale Parties leases necessary in any material respect for the operation of their respective properties and their Subsidiaries are subject to Rights of Wayassets, there are no encroachments or other encumbrances on under which the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party Company or any of their its Subsidiaries holds any Property or assets, real or personal, are valid, subsisting and enforceable and afford peaceful and undisturbed possession of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all subject matter of the Royale Interests forming lease, and no material default by the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out Company or otherwise disposed any of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) its Subsidiaries exists under any of the Royale Disclosure Schedulesprovisions thereof. All buildings, (i) none machinery and equipment of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, Company and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their its Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements)good repair and working order, except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except ordinary wear and tear, and except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated All material current and proposed uses of such Property or used by any Royale Party or any assets of their the Company and its Subsidiaries are subject to material penalties on allowables because permitted as of overproduction right and no regulation or violation ordinance interferes with such current or proposed uses. To the knowledge of the Company, there is no pending or formally proposed change in any applicable Law. (e) All Royale Interests operated by the Royale Parties such laws, regulations and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate ordinances which would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure SchedulesSchedule 4.20, none no condemnation proceeding is pending or, to the knowledge of the Royale Interests are subject to ------------- Company, threatened against the Company or any Tax partnership agreement of its Subsidiaries. All Property and assets of any kind (real or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherlandpersonal, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(gtangible or intangible) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of Company and its Subsidiaries are free from all Liens except for (a) Liens which it has any material future liability, nor is any Royale Party would not have a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(gMaterial Adverse Effect; (b) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future Liens disclosed on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value thereforSchedule -------- 4.20 hereto; and (c) Permitted Liens. Except as set forth on Section 5.10(g) Schedule 4.20 ---- ------------- hereto, neither the Company nor any of the Royale Disclosure Schedulesits Subsidiaries has signed any material financing statement, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option debtor or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbonslessee, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, any security agreement authorizing any secured party thereunder to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under file any such Contractfinancing statement. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to The Company and its Subsidiaries have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries own and have either good and valid marketable title in fee or a to, valid leasehold interestinterests in, Right of Way or other rights the legal right to the landuse, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case hold free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material EffectLiens and Encumbrances, all leasesof the assets, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding properties and are leasehold interests reflected in force and effect against the Royale Parties or any of their Subsidiaries and, to Financial Statements (the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted“Assets”), except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out those sold or otherwise disposed of since December 31, 2015, the date of the Financial Statements in the ordinary course of businessbusiness consistent with past practice and not in violation of this Agreement, free and clear except for Permitted Encumbrances. All Assets of the Company and its Subsidiaries that are material to the operations of their respective businesses are in good operating condition and repair, subject to normal wear and tear. The Company and its Subsidiaries have delivered to Parent or otherwise made available, correct and complete copies of all liens leases, subleases and Production Burdens other than Production Burdens not yet earned, due material agreements or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected material instruments relating to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) all real property used in conducting the businesses of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons Company and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons which the Company or proceeds from the sale thereof at Subsidiaries is a future point in time without receiving payment therefor at or after party (collectively, the time of delivery (other than gas balancing arrangements“Real Property”), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instrumentsare identified on Schedule 3.7. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there There are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests Company or any of the contracts governing Subsidiaries, threatened condemnation proceedings relating to any of the Royale Interests. (i) Real Property. Except as set forth on Section 5.10(i) of the Royale Disclosure SchedulesSchedule 3.7, none of the Contracts in respect of gatheringreal property improvements (including leasehold improvements), processing, storage equipment and other Assets owned or transportation used by the Company or its Subsidiaries is subject to any commitment or other arrangement for their sale or use by any Affiliate of the production Company or its Subsidiaries, or by third parties. To the Knowledge of Hydrocarbons from the Royale Interests contain Principal Shareholder, the Company’s leased real estate is free and clear of any minimum volume zoning or throughput provisions use or require the Royale Parties building restriction or any of their Subsidiaries to pay for services regardless of whether pending, proposed or threatened zoning or use or building restriction which would interfere with the Royale Parties present or any of their Subsidiaries deliver such production for intended use of by the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, Company of any of such leased real estate. Such leases are valid and binding and in full force and effect, and the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent Company is not in default thereunder as to the payment of rent or otherwise. The consummation of the transactions contemplated by this Agreement will not constitute an event of default under any of said leases and the type continuation, validity and effectiveness of such leases will not be adversely affected by the transactions contemplated under by this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries own and have either The Company has good and valid marketable title in fee or a valid leasehold interest, Right of Way or other rights to the landproperties and assets reflected on the Reference Balance Sheet of the Company other than nonmaterial properties and assets disposed of in the ordinary course of business consistent with past practice since the date of the Reference Balance Sheet, mineral and other subsurface rights, buildings, structures all such properties and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case assets are free and clear of claims, except (i) as set forth in Section 4.2 1(a) of the Company Disclosure Schedule and (ii) Permitted Encumbrances. Such properties and assets constitute all liens (except of the assets necessary to conduct the Company's business substantially in all cases for Permitted Liens). Except the same manner as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, it has been conducted prior to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreementsdate hereof. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that The Company does not violate own any real properties. Section 4.21(b) of the Rights of Way, Company Disclosure Schedule sets forth a complete and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment accurate list of the rights real properties leased by the Company (the "Leased Properties"). The Company has good and marketable leasehold title to the Leased Properties set forth in Section 4.21(b) of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of businessCompany Disclosure Schedule, free and clear of all liens claims, tenants and Production Burdens other than Production Burdens not yet earned, due or payable occupants except for Permitted Encumbrances and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on in Section 5.10(c4.21(b) of the Royale Company Disclosure SchedulesSchedule. Complete and accurate copies of all leases or other agreements relating to the Leased Properties have been made available to Parent and there have been no material changes or amendments to such leases or agreements since they were made available. The Company is the lawful owner of all improvements and fixtures located at the Leased Properties, (i) none free and clear of all Claims except for Permitted Encumbrances. Each lease or other agreement relating to the Leased Properties is a valid and subsisting agreement, without any default of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending orCompany thereunder and, to the Knowledge of each Royale PartyCompany's knowledge, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf without any default thereunder of the Royale Parties other party thereto, and such leases and agreements give the Company the right to use or any of their Subsidiaries within one year of occupy, as the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except case may be, all real properties as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries are sufficient and adequate to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) operate its business as it is currently being conducted. Except as set forth in Section 5.10(j4.21(b) of the Royale Company Disclosure SchedulesSchedule, none the possession of such property by the Contracts Company has not been disturbed nor has any claim relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring Company's title to or possession of such property been asserted against the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure SchedulesCompany.

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries subsidiaries own and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has such consents, easements, rights of way, permits and licenses (collectively, “Rights of Way Way”) from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its material obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that materially affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i5.10(j) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries own and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party The Company and its Subsidiaries has have good record and marketable fee title to (or, in the case of licensed Property, valid licenses to) all real Property and all other Property and assets, whether tangible or intangible, owned by them and reasonably necessary in the conduct of business of the Company or such Rights of Way from each person as are sufficient to conduct its business as currently conductedSubsidiaries, except for such Rights of Way the absence of defects in title which have do not had and would will not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by of the Royale Parties leases necessary in any material respect for the operation of their respective properties and their Subsidiaries are subject to Rights of Wayassets, there are no encroachments or other encumbrances on under which the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party Company or any of their its Subsidiaries holds any Property or assets, real or personal, are valid, subsisting and enforceable and afford peaceful and undisturbed possession of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all subject matter of the Royale Interests forming lease, and no material default by the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out Company or otherwise disposed any of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) its Subsidiaries exists under any of the Royale Disclosure Schedulesprovisions thereof. All buildings, (i) none machinery and equipment of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, Company and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their its Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements)good repair and working order, except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except ordinary wear and tear, and except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated All material current and proposed uses of such Property or used by any Royale Party or any assets of their the Company and its Subsidiaries are subject to material penalties on allowables because permitted as of overproduction right and no regulation or violation ordinance interferes with such current or proposed uses. To the knowledge of the Company, there is no pending or formally proposed change in any applicable Law. (e) All Royale Interests operated by the Royale Parties such laws, regulations and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate ordinances which would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure SchedulesSCHEDULE 4.20, none no condemnation proceeding is pending or, to the knowledge of the Royale Interests are subject to Company, threatened against the Company or any Tax partnership agreement of its Subsidiaries. All Property and assets of any kind (real or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherlandpersonal, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(gtangible or intangible) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of Company and its Subsidiaries are free from all Liens except for (a) Liens which it has any material future liability, nor is any Royale Party would not have a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(gMaterial Adverse Effect; (b) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future Liens disclosed on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value thereforSCHEDULE 4.20 hereto; and (c) Permitted Liens. Except as set forth on Section 5.10(g) SCHEDULE 4.20 hereto, neither the Company nor any of the Royale Disclosure Schedulesits Subsidiaries has signed any material financing statement, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option debtor or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbonslessee, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, any security agreement authorizing any secured party thereunder to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under file any such Contractfinancing statement. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to have The Company or a Royale Material Adverse Effect, Subsidiary of the Royale Parties and their Subsidiaries own and have either Company has good and valid marketable title to or, in fee or the case of leased property and leased tangible assets, a valid leasehold interestinterest in, Right all of Way or other rights to the landCompany’s and its Subsidiaries’ properties and assets, mineral and other subsurface rightsincluding the Company Leased Real Property, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens Liens, except those Liens for Taxes not yet due and payable and such other Liens or minor imperfections of title, if any, that do not detract, in any material respect, from the value or interfere with the present use of the affected property or asset. Such properties and assets are in good operating condition, maintenance and repair, ordinary wear and tear excepted, are useable in the ordinary course of business and are reasonably adequate and suitable for their current uses. Such properties and assets, together with all properties and assets held by the Company and its Subsidiaries under leases or licenses, include all tangible and intangible property, assets, Contracts and rights necessary or required for the operation of the business of the Company and its Subsidiaries as presently conducted. (except in all cases for Permitted Liensb) Neither the Company nor any of its Subsidiaries owns, or has ever owned, any real property or holds any option to acquire any real property. (c) Section 3.16(c) of the Company Letter sets forth a list and brief description of each lease or similar agreement (showing the parties thereto, annual rental, expiration date, renewal and purchase options, if any, the improvements thereon, the uses being made thereof, and the location and the legal description of the real property covered by such lease or other agreement) under which the Company or any Subsidiary of the Company is lessee of, or holds or operates, any real property owned by any third party (the “Company Leased Real Property”). Except as set forth in such Section, each such lease is in full force and effect, is enforceable in accordance with its terms, and is valid and without default (including any event which with notice or lapse of time or both would not reasonably be expected become a default) thereunder by the lessee or, to have a Royale Material Effectthe Knowledge of the Company, the lessor. The Company or one of its Subsidiaries has the right to quiet enjoyment of all leasesthe Company Leased Real Property for the full term of the lease or similar agreement (and any renewal option related thereto) relating thereto, Rights of Way and the leasehold or other agreements under which any Royale Party interest of the Company or any Subsidiary of their Subsidiaries leasethe Company in the Company Leased Real Property is not subject or subordinate to any Lien. Complete and correct copies of any title opinions, access surveys and appraisals in the Company’s possession or use any real property are valid, binding and are policies of title insurance currently in force and effect against in the Royale Parties possession of the Company with respect to each parcel of Company Leased Real Property have previously been made available by the Company to Parent. The leasehold interests described in Section 3.16(c) of the Company Letter are sufficient to conduct the business of the Company and its subsidiaries as now conducted. (d) Neither the whole nor any part of the Company Leased Real Property is subject to any pending suit for condemnation or other taking by any of their Subsidiaries Governmental Entity, and, to the Knowledge of each Royale Partythe Company, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are in default under any no such leases, Rights of Way condemnation or other agreementstaking is threatened or contemplated. (b) Each Royale Party and its Subsidiaries has such Rights of Way from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and their Subsidiaries, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Section 4.15(a) of the Disclosure Letter sets forth a true, correct and complete list of all real property owned by each Subject Entity (excluding for this purpose WV Alloys) or an affiliate thereof in connection with the Brazilian Business or the Alloy Business (the “Owned Real Property”). Each Subject Entity (or the applicable affiliate thereof) has good and marketable title to or other legal right to use the Owned Real Property. None of the Owned Real Property is subject to any Liens except Permitted Liens. Globe has provided or made available to DCC true and correct copies of all title reports and title policies (including all exception documents referenced therein) and surveys in its possession or control regarding the Owned Real Property. (b) Section 4.15(b)(i) of the Disclosure Letter sets forth a true, correct and complete list of all real property and interests in real property leased, licensed or otherwise occupied by each Subject Entity or an affiliate thereof in connection with the Brazilian Business or the Alloy Business (the “Leased Real Property” and together with the Owned Real Property, the “Real Property”). Globe has delivered or made available to DCC true, correct and complete copies of all Leases. Except as would not reasonably be expected set forth in Section 4.15(b)(ii) of the Disclosure Letter and Schedule B to have a Royale Material Adverse Effectthe Title Commitment, there are no leases, ground leases, licenses or other occupancy agreements granting to any party or parties (other than any of the Royale Parties and their Subsidiaries own and have either good and valid title in fee Subject Entities) the right of use or occupancy of any portion of the Real Property. Each Subject Entity, as applicable, has a valid leasehold interestinterest to each of the Leased Real Property, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (Liens, except in all cases for Permitted Liens). Except as would None of Globe, GMI nor any Subject Entity has received notice of default under any Lease that has not reasonably be expected to have a Royale Material Effect, all leases, Rights of Way been cured or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties or any of their Subsidiaries waived and, to the Knowledge of each Royale Partythe Globe Knowledge Parties, no event has occurred and no condition exists that, with notice or lapse of time or both, will constitute a default under any Lease. To the counterparties theretoKnowledge of the Globe Knowledge Parties, in accordance with their respective terms, and neither the Royale Parties nor any of their Subsidiaries are no other party is in default under any Lease and no party to such leaseslease has exercised any termination rights with respect thereto. Except as set forth on Section 4.15(b)(ii) of the Disclosure Letter, Rights no Subject Entity has received any written notice in the last twelve (12) months (i) from any Governmental Authority that it is imposing a general or special assessment relating to any of Way the Real Property, (ii) from any Governmental Authority indicating that any of the Real Property or any Improvements (as defined below) is not in compliance with applicable zoning laws or that the Governmental Authority will be seeking modification of any variances, special exceptions, conditions or agreements pertaining to such Real Property or that such Governmental Authority intends to modify, in any material respect, the zoning of, or other agreements. governmental rules or restrictions applicable to, the Real Property or the use thereof, or (biii) Each Royale Party and its Subsidiaries has such Rights requiring or calling attention to the need for any work, repair, construction, alteration or installation on, or in connection with, any of Way from each person as are sufficient to conduct its business as currently conductedthe Real Property, except for in the case of (i), (ii) or (iii) above, where the imposition of the assessment, the failure to comply with such Rights of Way zoning laws or the absence of which have failure to perform such work, repair, construction, alteration or installation, as applicable, has not had resulted and would not reasonably be expected to have a Royale Globe Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business Except as set forth in a manner that does not violate any Section 4.15(b)(iii) of the Rights Disclosure Letter, no Subject Entity has received a written notice of Wayany pending condemnation or eminent domain proceeding against any Real Property and to the Knowledge of the Globe Knowledge Parties, no such condemnation or eminent domain proceeding is threatened. All of the properties and assets of the Subject Entities consisting of buildings, fixtures, building systems, and no event has occurred that allows, equipment (whether owned or after notice or lapse of time would allow, revocation or termination thereof or would result leased) included in any impairment the Real Property (the “Improvements”) currently used in the normal operations of the rights of Brazilian Business or the holder of any such Rights of WayAlloy Business have been maintained by the Subject Entities and are in good operating condition, subject to normal wear and tear, and are free from material defects, except for where such revocations, terminations and impairments that have not had and defects would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Globe Material Adverse Effect. (c) No Subject Entity has granted, and no Globe Knowledge Party has any Knowledge of, any outstanding options, rights of first offer, rights of refusal or similar preemptive rights to purchase or lease any of the Real Property, or any portion thereof or interest therein (other than any such rights in favor of a Subject Entity). (d) The present use of the Real Property (including the Improvements) is, and the Improvements themselves are, in substantial conformity with all applicable Laws and with all recorded deeds, restrictions of record and other agreements affecting such Real Property other than any violations or failures to conform that do not materially and adversely affect the use and operation of the Real Property, and none of Globe, GMI or any Subject Entity has received any written notice of any violation thereof currently outstanding, and the Globe Knowledge Parties have no Knowledge of any violation thereof currently outstanding. The Real Property includes all land, Improvements, easements and other rights and interests appurtenant thereto materially necessary for use by the Subject Entities in the conduct of the Brazilian Business and the Alloy Business as presently conducted. To the Knowledge of the Globe Knowledge Parties, none of the items set forth Section 1.1(c) and/or Section 4.15(b) of the Disclosure Letter or items set forth in Schedule B to the Title Commitment have had a material adverse effect, individually or in the aggregate, on the use of the Real Property. (e) Except as would not reasonably be expected contemplated by this Agreement and the Restructuring Transactions, no Subject Entity has entered into any Contract or other obligation, and no Globe Knowledge Party has any Knowledge of any Contract or other obligation, that is currently in effect for the sale, exchange, encumbrance or transfer of any of the Real Property. (f) Section 4.15(f) of the Disclosure Letter sets forth all leases of personal property involving annual payments in excess of U.S. $100,000 relating to have personal property used in the Brazilian Business or the Alloy Business and to which any Subject Entity is a Royale Material Adverse Effectparty or by which its properties or assets is bound (the “Personal Property Leases”). Globe has delivered or made available to DCC true, correct and complete copies of the Royale Parties Personal Property Leases, together with all amendments, modifications or supplements thereto. The applicable Subject Entity has a valid leasehold interest under each of the Leases under which it is a lessee, subject to applicable bankruptcy, insolvency, reorganization, moratorium and their Subsidiariessimilar Laws affecting creditors’ rights and remedies generally and subject, as applicableto enforceability, have defensible to general principles of equity. None of Globe, GMI nor any Subject Entity has received any written notice of default under any Personal Property Lease that has not been cured or waived and, to the Knowledge of the Globe Knowledge Parties, no event has occurred and no condition exists that, with notice or lapse of time or both, will constitute a default under any Personal Property Lease. To the Knowledge of the Globe Knowledge Parties, no other party is in default under any Personal Property Leases and no party to the Personal Property Leases has exercised any termination rights with respect thereto. Each Subject Entity has good and marketable title to all of the Royale Interests forming items of personal property reflected on the basis for Brazilian Balance Sheet or the reserves reflected in the Royale Financial Statements except for such Royale Interests soldAlloy Balance Sheet, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of businessas applicable, free and clear of any and all liens and Production Burdens Liens other than Production Burdens not yet earned, due or payable and the Permitted Liens (other than Production Burdens)Liens. Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) All such items of personal property which are used in the normal operation of the Royale Disclosure SchedulesBrazilian Business or Alloy Business, as applicable, are in good condition and in a state of good maintenance and repair (iordinary wear and tear excepted) none of the proceeds from the sale of Hydrocarbons produced from the Royale Interests in any producing well and are being held in suspense for any reason, and (ii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except suitable for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statementspurposes used. (d) All of the ▇▇▇▇▇ owned, leased, operated or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide or injection ▇▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Interests operated by the Royale Parties and their Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except The Company and its Subsidiaries have good and valid title to all of their respective material properties, interests in properties and assets, real and personal, reflected on the Most Recent Balance Sheet or acquired since the Most Recent Balance Sheet Date, or, in the case of material leased properties and assets, valid leasehold interests in such properties and assets, in each case free and clean of all Liens, except in each case in this Section 3.17(a) as would not reasonably be expected to have a Royale Company Material Adverse Effect, . (b) Section 3.17(b) of the Royale Parties Company Disclosure Schedule sets forth a complete and their correct list of each parcel of real property owned or leased by the Company or any of its Subsidiaries own (the “Leased Facilities),” with the leases pursuant to which the Company or any of its Subsidiaries is a tenant of any such Leased Facility being hereinafter referred to as the “Leases”). Section 3.17(b) of the Company Disclosure Schedule also sets forth a complete and have either good and valid title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear correct summary of all liens (the Lease Facility Liability as of the date hereof. As of the date of this Agreement, except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Company Material Effect, all leases, Rights of Way or other agreements under which any Royale Party or any of their Subsidiaries lease, access or use any real property are valid, binding and Adverse Effect (i) the Leases are in full force and effect against the Royale Parties or any of their Subsidiaries and, to the Knowledge of each Royale Party, the counterparties thereto, in accordance with their respective terms, (ii) the Company is not in default of any of its obligations under the Leases and neither (iii) to the Royale Parties Company’s knowledge, the landlords under the Leases are not in default of the landlords’ obligations under the Leases. The Company has not been in default of any of its obligations under any Lease on more than three occasions in the twelve months preceding the date of this Agreement. The Company and its Subsidiaries have the right to assign the Leases to the Surviving Corporation and to allow the Parent and its Subsidiaries to occupy the Leased Facilities. At the Effective Date, the premises to be conveyed or leased by the Surviving Corporation following the Closing pursuant to the Leases shall be free and clear of all subtenants and occupants other than the Surviving Corporation’s employees. Neither the Company nor any of their Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party and its Subsidiaries has granted to any Person any options or encumbrances on the Leased Facilities, which would allow such Rights of Way from each person as are sufficient Person to conduct its business as currently conducted, except for such Rights of Way interfere with or limit the absence of which have not had and would not reasonably be expected to have a Royale Material Adverse Effect. Each Royale Party and its Subsidiaries has fulfilled and performed all its obligations with respect to such Rights of Way and conducts their business Surviving Corporation’s rights in a manner that does not violate any of the Rights of Way, Leased Facilities during the term thereof and no event has occurred that allowsor circumstance exists which, with the delivery of notice, the passage of time or both, would constitute such a breach or default, or after notice permit the termination, modification or lapse acceleration of time would allow, revocation or termination thereof or would result in rent under any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party or any of their Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Material Adverse EffectLeases. (c) Except as would not reasonably be expected to have a Royale Company Material Adverse Effect, the Royale Parties all personal property and their Subsidiariesequipment owned, as applicable, have defensible title to all of the Royale Interests forming the basis for the reserves reflected in the Royale Financial Statements except for such Royale Interests sold, used, farmed out leased or otherwise disposed used by the Company or any of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Material Adverse Effect or as set forth on Section 5.10(c) of the Royale Disclosure Schedules, its Subsidiaries (i) none are in a good state of maintenance and repair, free from material defects and in good operating condition (subject to normal wear and tear), (ii) comply with the proceeds from the sale of Hydrocarbons produced from the Royale Interests applicable Leases and with all applicable Laws in any producing well are being held in suspense for any reasonall material respects, and (iiiii) there are no calls on production or preferential rights to purchase Hydrocarbons and the Royale Parties nor any of their Subsidiaries are not obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except suitable for the rights of any lessor to take free gas under the terms of any applicable lease purposes for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Material Adverse Effect, the Royale Parties and each applicable Subsidiary (A) which they are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statementspresently used. (d) All of To the ▇▇▇▇▇ ownedCompany’s knowledge, leasedthere is no condemnation, operated expropriation or used by the Royale Parties and their Subsidiaries and all water, carbon dioxide appropriation proceeding pending or injection ▇▇▇▇▇ located on threatened against any property owned, leased, operated or used by the Royale Parties and their Subsidiaries or otherwise associated with the Royale Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Material Adverse Effect. No well owned, leased, operated or used by any Royale Party Leased Facility or any of their Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Lawthe improvements thereon. (e) All Royale Interests True and correct copies of the documents under which the Leased Facilities are leased or subleased to or utilized and/or operated by the Royale Parties Company and their its Subsidiaries (the “Lease Documents”) have heretofore been operated in accordance with reasonable, prudent field practices delivered or made available to Parent. The Lease Documents are unmodified and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Material Adverse Effect. None of the Interests of the Royale Parties or their Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Material Adverse Effect. Except as set forth on Section 5.10(e) of Royale Disclosure Schedules, none of the Royale Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Returnfull force and effect. (f) There are no material inaccuracies in the report of Netherland, ▇▇▇▇▇▇ & Associates, Inc. as of December 31, 2015, and dated February 1, 2016. (g) Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, no Royale Party is engaged in any oil, natural gas or other futures or option trading in respect of which it has any material future liability, nor is any Royale Party a party to any price swaps, ▇▇▇▇▇▇, futures or similar instruments. Section 5.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party for the delivery of Hydrocarbons attributable to any of the Royale Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party is bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Party, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties or any of their Subsidiaries within one year of the Royale Merger Effective Time in any of the Royale Interests or any of the contracts governing any of the Royale Interests. (i) Except as set forth on Section 5.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Interests contain any minimum volume or throughput provisions or require the Royale Parties or any of their Subsidiaries to pay for services regardless of whether the Royale Parties or any of their Subsidiaries deliver such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i) of the Royale Disclosure Schedules.

Properties and Assets. (a) Except as would not reasonably be expected to have a Royale Corporation Material Adverse Effect, the Royale Parties Corporation or a Subsidiary of the Corporation each respectively owns and their Subsidiaries own and have has either good and valid title in fee or a valid leasehold interest, Right of Way (defined below) or other rights to the land, mineral and other subsurface rights, buildings, structures and other improvements thereon and fixtures thereto necessary to permit it to conduct its business as currently conducted, in each case free and clear of all liens (except in all cases for Permitted Liens). Except as would not reasonably be expected to have a Royale Corporation Material Effect, all leases, Rights of Way or other agreements under which any Royale Party the Corporation or any of their its Subsidiaries lease, access or use any real property are valid, binding and are in force and effect against the Royale Parties Corporation or any of their its Subsidiaries and, to the Knowledge of each Royale Partythe Corporation, the counterparties thereto, in accordance with their respective terms, and neither the Royale Parties Corporation nor any of their its Subsidiaries are in default under any such leases, Rights of Way or other agreements. (b) Each Royale Party of the Corporation and its Subsidiaries has such consents, easements, rights of way, permits and licenses (collectively, “Rights of Way Way”) from each person as are sufficient to conduct its business as currently conducted, except for such Rights of Way the absence of which have not had and would not reasonably be expected to have a Royale Corporation Material Adverse Effect. Each Royale Party of the Corporation and its Subsidiaries has fulfilled and performed all its material obligations with respect to such Rights of Way and conducts their business in a manner that does not violate any of the Rights of Way, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or would result in any impairment of the rights of the holder of any such Rights of Way, except for such revocations, terminations and impairments that have not had and would not reasonably be expected to have a Royale Corporation Material Adverse Effect. All pipelines owned or operated by the Royale Parties and their Subsidiaries Corporation are subject to Rights of Way, there are no encroachments or other encumbrances on the Rights of Way that materially affect the use thereof and there are no gaps (including any gap arising as a result of any breach by a Royale Party the Corporation, the Matrix LPs, Matrix or any of their its Subsidiaries of the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and would not reasonably be expected to have a Royale Corporation Material Adverse Effect. (c) Except as would not reasonably be expected to have a Royale Corporation Material Adverse Effect, the Royale Parties Corporation and their its Subsidiaries, as applicable, have defensible title to all of the Royale Property Interests forming the basis for the reserves reflected in the Royale Audited Financial Statements except for such Royale Property Interests sold, used, farmed out or otherwise disposed of since December 31, 2015, in the ordinary course of business, free and clear of all liens and Production Burdens other than Production Burdens not yet earned, due or payable and Permitted Liens (other than Production Burdens). Except as would not reasonably be expected to have a Royale Corporation Material Adverse Effect or as set forth on Section 5.10(c4.10(c) of the Royale Disclosure Schedules, (i) none of the proceeds from the sale of Hydrocarbons produced from the Royale Property Interests in any producing well are being held in suspense for any reason, and (ii) there are no calls on production or or, preferential rights to purchase Hydrocarbons and neither the Royale Parties Corporation nor any of their its Subsidiaries are not is obligated to deliver Hydrocarbons or proceeds from the sale thereof at a future point in time without receiving payment therefor at or after the time of delivery (other than gas balancing arrangements), except for the rights of any lessor to take free gas under the terms of any applicable lease for its use on the lands covered by such lease. Except as would not reasonably be expected to have a Royale Corporation Material Adverse Effect, the Royale Parties Corporation and each applicable Subsidiary (A) are in compliance with all valuation agreements, and settlement agreements with respect to Production Burdens, and (B) have paid or will cause to be paid when due all Production Burdens with respect to the Royale Property Interests and each other royalty, Tax or similar payment, except for such amounts that are being held in suspense as permitted pursuant to applicable Law or the terms of the applicable Contract or as reserved against in the Royale Financial Statements. (d) All of the ▇w▇▇▇▇ owned, leased, operated or used by the Royale Parties Corporation and their its Subsidiaries and all water, carbon dioxide or injection ▇w▇▇▇▇ located on any property owned, leased, operated or used by the Royale Parties Corporation and their its Subsidiaries or otherwise associated with the Royale Property Interests have been drilled, completed and operated within the limits permitted by the applicable Contract granting such rights and applicable Law, and all drilling and completion (and plugging and abandonment) of such ▇w▇▇▇▇ and all related development, production and other operations have been conducted in compliance with all applicable Laws except, in each case, as would not reasonably be expected to have a Royale Corporation Material Adverse Effect. No well owned, leased, operated or used by any Royale Party the Corporation or any of their its Subsidiaries are subject to material penalties on allowables because of overproduction or violation of any applicable Law. (e) All Royale Property Interests operated by the Royale Parties Corporation and their its Subsidiaries have been operated in accordance with reasonable, prudent field practices and in compliance with the applicable Contracts, except where the failure to so operate would not reasonably be expected to have a Royale Corporation Material Adverse Effect. None of the Interests of the Royale Parties Corporation or their its Subsidiaries is subject to any preferential purchase, consent or similar right that would become operative as a result of the Transactions, except for any such preferential purchase, consent or similar rights that would not reasonably be expected to have a Royale Corporation Material Adverse Effect. Except as set forth on Section 5.10(e4.10(e) of Royale Disclosure Schedules, none of the Royale Property Interests are subject to any Tax partnership agreement or provisions requiring a partnership income Tax Return. (f) There are no material inaccuracies in the report Summary Projection of Netherland, ▇▇▇▇▇▇ & Associates, Inc. Reserves and Revenues as of December March 31, 20152016, and dated February 1of the Corporation, with run date June 10, 2016, a correct and complete copy of which the Corporation has made available to Royale prior to the date of this Agreement. (g) Except as set forth on Section 5.10(g4.10(g) of the Royale Disclosure Schedules, no Royale Party the Corporation is not engaged in any oil, natural gas or other futures or option options trading in respect of which it has any material future liability, nor is any Royale Party it a party to any price swaps, ▇h▇▇▇▇▇, futures or similar instruments. Section 5.10(g4.10(g) of the Royale Disclosure Schedules sets forth obligations of each Royale Party the Corporation for the delivery of Hydrocarbons attributable to any of the Royale Property Interests in the future on account of prepayment, advance payment, take-or-pay or similar obligations without then or thereafter being entitled to receive full value therefor. Except as set forth on Section 5.10(g4.10(g) of the Royale Disclosure Schedules, as of the date hereof, no Royale Party the Corporation is not bound by futures, hedge, swap, collar, put, call, floor, cap, option or other Contracts that are intended to benefit from, relate to or reduce or eliminate the risk of fluctuations in the price of commodities, including Hydrocarbons, or securities. (h) Except as provided in Section 5.10(h4.10(h) of the Royale Disclosure Schedules, there are no mandatory drilling or completion obligations and there are no pending or, to the Knowledge of each Royale Partythe Corporation, expected proposals or elections for drilling, completing, recompleting, reworking, facilities or similar activities that would require such commitment on behalf of the Royale Parties Corporation or any of their its Subsidiaries within one year of the Royale Merger Effective Time Closing Date in any of the Royale Property Interests or any of the contracts governing any of the Royale Property Interests. (i) Except as set forth on Section 5.10(i4.10(i) of the Royale Disclosure Schedules, none of the Contracts in respect of gathering, processing, storage or transportation of the production of Hydrocarbons from the Royale Property Interests contain any minimum volume or throughput provisions or require the Royale Parties Corporation or any of their its Subsidiaries to pay for services regardless of whether the Royale Parties Corporation or any of their its Subsidiaries deliver delivers such production for use of the services provided for under any such Contract. (j) Except as set forth in Section 5.10(j4.10(j) of the Royale Disclosure Schedules, none of the Contracts relating to the Royale Property Interests (including all oil, gas and mineral leases and similar Contracts) contain any provision (i) requiring the lessee to pay royalties on ▇h▇▇▇▇▇, (ii) causing the oil, gas or mineral lease or contract to terminate without advance notice and the opportunity to cure resulting in a loss, in whole or in part, of any of the Royale Property Interests for lessee’s failure to pay royalties or for lessee’s breach of any covenant thereunder, (iii) requiring lessor’s consent to the consummation of the transactions of the type contemplated under this Agreement, or (iv) is expected to result in a mandatory payment or expenditure not otherwise disclosed in Section 5.10(i4.10(i) of the Royale Disclosure Schedules.