Razor Energy Corp.

ROYALTY PURCHASE AND SALE AGREEMENT

DATED EFFECTIVE THE 16[TH] DAY OF FEBRUARY, 2021

BETWEEN:

(as Vendor)

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RAZOR ROYALTIES LIMITED PARTNERSHIP

(as Purchaser)

ROYALTY PURCHASE AND SALE AGREEMENT

THIS ROYALTY PURCHASE AND SALE AGREEMENT (“ Agreement ”) is made effective as of the Effective Date.

BETWEEN :

RAZOR ENERGY CORP. , a corporation existing under the laws of the Province of Alberta (" Vendor "),

and –

RAZOR ROYALTIES LIMITED PARTNERSHIP , a limited partnership formed under the laws of the Province of Alberta (" Purchaser ").

WHEREAS :

A. Vendor holds those interests in the Royalty Lands set forth in Schedule “A” hereto; and
B. Vendor wishes to sell and grant to Purchaser, and Purchaser wishes to purchase and receive from Vendor, the Assets, subject to and in accordance with the terms of this Agreement;
NOW THEREFORE in consideration of the premises and the mutual covenants and agreements hereinafter set forth, the Parties agree as follows:

Article 1 DEFINITIONS AND INTERPRETATION

1.1 Definitions

In this Agreement, unless the context otherwise requires:

(a) " Affiliate " has the meaning given to that term in the Overriding Royalty Agreement;
(b)
" Agreement " has the meaning given to that term in the preamble hereof;
(c) “ AIMCo ” means Alberta Investment Management Corporation, in its capacity as agent pursuant to the AIMCo Loan Agreement, and its successors in such capacity;
(d) “ AIMCo Loan Agreement ” means the second amended and restated loan agreement among, inter alios , Vendor, as borrower, AIMCo and the lenders from time to time party thereto, as further amended, supplemented, renewed, restated or replaced from time to time;
(e) “ AIMCo No Interest Letter ” means a no interest letter in a form acceptable to Purchaser, acting reasonably, duly executed by or on behalf of AIMCo and stating that the AIMCo Security shall not apply to the Overriding Royalty for the term of the Overriding Royalty Agreement;
(f) “ AIMCo Security ” means the security held by AIMCo over the assets of Vendor in respect of Vendor’s indebtedness under and in connection with the AIMCo Loan Agreement;
(g)
" Applicable Laws " has the meaning given to that term in the Overriding Royalty Agreement;
(h) “ Arena ” means 405 Dolomite LLC, in its capacity as agent pursuant to the Arena Loan Agreement, and its successors in such capacity;
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(i) “ Arena Loan Agreement ” means the loan agreement among, inter alios , Purchaser, as borrower, Vendor, as guarantor, Arena and the lenders from time to time party thereto, as amended, supplemented, renewed, restated or replaced from time to time;
(j) “ Arena Security ” means the security held by Arena over the assets of Vendor and Purchaser in respect of Purchaser’s indebtedness and Vendor’s obligations under and in connection with the Arena Loan Agreement;
(k) " Assets " means the Overriding Royalty;
(l) " Business Day " has the meaning given to that term in the Overriding Royalty Agreement;
(m) “ Casualty or Condemnation ” means any:
(i) fire, blowout, leak, explosion, accident, earthquake, act of public enemy or other casualty; or
(ii) pending or threatened taking, in condemnation or under the right of eminent domain;

of any of the Royalty Lands (including the Royalty Wells) or any portion thereof and any real or personal property that is used to operate the Royalty Lands, the Royalty Wells, and the production of Petroleum Substances therefrom;

(n) “ Closing ” has the meaning given to that term in Section 2.2;
(o) " Control " has the meaning given to that term in the Overriding Royalty Agreement;
(p) " Effective Date " means February 16, 2021;
(q) " Environmental Liabilities " has the meaning given to that term in the Overriding Royalty Agreement;
(r) “ Good and Defensible Title ” means that Vendor owns legal and/or beneficial title to the Assets that, subject to the Permitted Encumbrances, is free and clear of any:
(i) encumbrances, liens, security interests, mortgages, pledges, preferential purchase rights, or requirements for consents to assignment that would be applicable to or exercisable as a result of the sale or assignment thereof; and
(ii) defect or other impediments that affect or interfere with the operation, use, possession, ownership or value thereof;
(s) " Governmental Authority " has the meaning given to that term in the Overriding Royalty Agreement;
(t) " GST " means the goods and services tax provided for in the Excise Tax Act (Canada) and any other tax imposed or levied by the Government of Canada on or in respect of the sale or supply of goods or services in addition to or replacement for such goods and service tax;
(u) " Overriding Royalty " means the non-convertible gross overriding royalty created under the Overriding Royalty Agreement;
(v) " Overriding Royalty Agreement " means the form of overriding royalty agreement attached hereto as Schedule "B";
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(w) " Other Sales Taxes " means all sales, value-added or similar taxes or other transfer taxes, fees and charges, other than GST, imposed or levied by any Governmental Authority on or in respect of the sale or supply of goods or services;
(x) " Parties " means, collectively, Vendor and Purchaser, and " Party " means either Vendor or Purchaser, as applicable;
(y)

" Permitted Encumbrances " means:

(i) the Overriding Royalty and the AIMCo Security (subject to the AIMCo No Interest Letter);
(ii) liens for taxes, assessments and charges of Governmental Authorities which are not due or delinquent at Closing or the validity of which is being diligently contested in good faith by or on behalf of Vendor;
(iii) liens incurred or created in the ordinary course of business to a Governmental Authority in connection with development or operations pertaining to the Royalty Lands;
(iv) undetermined or inchoate liens incurred or created as security in favour of any Third Party conducting the development or operation of the Royalty Lands and arising in the ordinary course of business for Vendor’s proportionate share of the costs and expenses of such development or operations and which are not due or delinquent at Closing or the validity of which is being diligently contested in good faith by or on behalf of Vendor;
(v) mechanics', builders' and materialmen's liens in respect of services rendered or goods supplied for which payment is not due or delinquent at Closing or the validity of which is being diligently contested in good faith by or on behalf of Vendor;
(vi) the right reserved to or vested in any Governmental Authority by the terms of any lease, licence, franchise, grant or permit or by any statutory provision, to control or regulate the Royalty Lands in any manner, to terminate any such lease, licence, franchise, grant or permit, or to require annual or other periodic payments as a condition of the continuance thereof;
(vii) rights of general application reserved to or vested in any Governmental Authority to levy taxes on Petroleum Substances or income from the sale thereof and governmental requirements and limitations of general application as to production rates of Petroleum Substances on the operations of any property;
(viii) statutory exceptions to title and the reservations, limitations, provisos and conditions in any original grants from the Crown of any of the mines and minerals within, upon or under the Royalty Lands;
(ix) any security held by any Third Party encumbering Vendor’s interest in and to the Assets or any part or portion thereof in respect of which (i) Purchaser has not requested a release or registerable discharge in writing; or (ii) Purchaser has requested such a release or discharge and Vendor delivers a discharge or no-interest letter to Purchaser at or prior to Closing;
(x) Petroleum Substance sales, processing , transportation or storage contracts on normal market terms that are terminable without penalty on not more than thirty-one (31) days’ notice to the purchaser thereof;
(xi) easements, rights of way, servitudes and other similar rights in land which do not materially impair the use of the Royalty Lands, including rights of way and servitudes for highways
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and other roads, railways, sewers, drains, gas and oil pipelines, gas and water mains, electric light, power, telephone, telegraph and cable television conduits, poles, wires and cables;

(xii) the terms and conditions of the Title and Operating Documents; and
(xiii) all royalty burdens, liens, adverse claims, penalties, reductions in interests and other encumbrances set out in Schedule "A";
(z) " Person " means any individual, body corporate, partnership, trust, trustee, executor or similar official, Governmental Authority or other entity and includes the Parties;
(aa) " Petroleum Substances " has the meaning given to that term in the Overriding Royalty Agreement;
(bb) " Purchase Price " has the meaning given to that term in Section 2.3;
(cc) " Purchaser " has the meaning given to that term in the preamble;
(dd) " Purchaser Related Persons " means Purchaser, its Affiliates and each of their respective directors, officers, employees and agents;
(ee) " Royalty Lands " has the meaning given to that term in the Overriding Royalty Agreement;
(ff) " Royalty Well " has the meaning given to that term in the Overriding Royalty Agreement;
(gg) “ Schedules ” has the meaning given to that term in Section 1.3;
(hh) " Third Party " means any Person other than Vendor and Purchaser;
(ii) " Title and Operating Documents " has the meaning given to that term in the Overriding Royalty Agreement;
(jj) " Transaction " means the purchase and sale of the Assets as set forth and described in this Agreement;
(kk)
" Vendor " has the meaning given to that term in the preamble hereof;
(ll) " Vendor Related Persons " means Vendor, its Affiliates and each of their respective directors, officers, employees and agents; and
(mm) " Working Interest " has the meaning given to that term in the Overriding Royalty Agreement.
1.2 Interpretation

Unless otherwise stated or the context otherwise necessarily requires, in this Agreement:

(a) the expressions "Article", "Section" and "Schedule" followed by a number or letter or combination thereof mean and refer to the specified article, section and schedule of or to this Agreement;
(b) words importing the singular shall include the plural and vice versa;
(c) all monetary amounts expressed herein or calculated or to be paid pursuant hereto shall be in Canadian dollars unless otherwise specified;
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(d) capitalized words and phrases used herein which are derivatives of words or phrases otherwise defined herein shall have a corresponding meaning;
(e) any reference in this Agreement to Royalty Lands shall, where provided for in the applicable Title and Operating Documents, be construed to include lands pooled or unitized with the Royalty Lands;
(f) any reference in this Agreement to an Applicable Law or to any consent, approval, permit or other authorization of a Governmental Authority shall be deemed to refer to such Applicable Law or such consent, approval, permit or other authorization of a Governmental Authority as it has been amended, supplemented, re-enacted, varied, or otherwise modified or replaced from time to time up to the applicable time;
(g) where any payment or calculation is to be made, or any other action is to be taken, on or as of a day that is not a Business Day, that payment or calculation is to be made, or that other action is to be taken, as applicable, on or as of the next following Business Day;
(h) unless otherwise specified, time periods within or following which any payment is to be made or any act is to be done under this Agreement shall be calculated by excluding the day on which the period commences and including the day on which such period ends;
(i) the use of "including" or "includes" or similar words in this Agreement, when following any general statement, term or matter, is not to be construed to limit such general statement, term or matter to the specific items immediately following such word to those or similar items, whether or not nonlimiting language (such as "without limitation" or "but not limited to" or words or phrases of similar import) is used, but rather such references shall be construed to refer to all items that could reasonably fall within the broadest possible scope of such general statement, term or matter;
(j) words such as "hereof", "herein" or "hereunder" shall mean "of", "in" or "under" this Agreement and not the specific section in which the reference occurs unless expressly otherwise noted;
(k) the headings contained in this Agreement are intended for convenience of reference only and shall form no part of this Agreement;
(l) the rule of " contra proferentem " shall not apply to this Agreement; and
(m) terms and expressions that are not specifically defined in this Agreement, but which have generally accepted meanings in the custom and usage of the petroleum and natural gas industry in Western Canada as of the date hereof, shall have such generally accepted meanings when used in this Agreement unless the contrary is specified or provided for elsewhere in this Agreement.

1.3 Schedules

The following schedules (the " Schedules ") are attached to, form a part of and are incorporated in this Agreement:

Schedule "A" – Royalty Lands Schedule "B" – Overriding Royalty Agreement Schedule "C" – Form of Officer's Certificate Schedule “D” – Disclosure Schedule

Wherever any term or condition of the Schedules conflicts or is at variance with any term or condition in the body of this Agreement, such term or condition in the body of this Agreement shall prevail.

1.4 Knowledge

Where in this Agreement a representation or warranty is made on the basis of the knowledge of Vendor, such knowledge consists only of the actual knowledge of those current officers of Vendor, whose normal responsibilities relate to the matter in question, without any specific inquiry of Vendor's files or records or any Third Party's files or records, and does not include knowledge or awareness of any other individual or any constructive or imputed knowledge.

Article 2 PURCHASE AND SALE AND CLOSING

2.1 Purchase, Sale and Conveyance

Subject to and in accordance with the terms of this Agreement, effective as of the Effective Date, Vendor hereby sells, assigns, transfers, conveys and sets over to Purchaser, and Purchaser hereby purchases and accepts from Vendor, Vendor's entire right, title, estate and interest in and to the Assets, to have and to hold the same absolutely, together with all benefits and advantages to be derived therefrom, subject to the terms of the Overriding Royalty Agreement.

2.2 Closing

Title to, and beneficial ownership, risk and possession of, the Assets shall pass from Vendor to Purchaser concurrently with the execution and delivery of this Agreement by the Parties and shall be effective as of the Effective Date (the “ Closing ”).

2.3 Purchase Price

The aggregate consideration to be paid by Purchaser to Vendor for the Assets shall be eleven million, six hundred and fifty-four thousand, five hundred and thirteen dollars and eleven cents ($11,654,513.11) (the " Purchase Price ").

2.4 Payment of Purchase Price

Purchaser shall pay the Purchase Price to Vendor on the Effective Date hereof by wire transfer in immediately available funds.

2.5 GST and Other Sales Taxes

(a) The Purchase Price does not include an amount on account of GST or any Other Sales Taxes payable in respect of the Transaction.
(b) The Parties acknowledge that it is their understanding that no Other Sales Taxes are payable in respect of the Transaction and, therefore, no amount will be paid by Purchaser to Vendor, and no amount will be collected by Vendor from Purchaser, on account of Other Sales Taxes in respect of the Transaction.
(c) The Parties agree that, as between Vendor and Purchaser, Purchaser shall be solely liable for and Purchaser shall indemnify, defend and keep harmless Vendor from any GST, penalty, interest or other amounts which may be payable by or assessed against Vendor under the Excise Tax Act (Canada) or any losses, costs, damages, expenses and liabilities suffered, sustained, paid or incurred by the Vendor Related Persons or any claims made against any Vendor Related Person as a result of or in connection with the failure by Purchaser to pay or Vendor to collect any GST on the date hereof, except to the extent that such penalty, interest or other amounts payable by Vendor is the result of any act or omission by Vendor.
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Article 3 CLOSING DELIVERIES

3.1 Deliveries by Vendor at Closing

Concurrently with the execution of this Agreement, Vendor shall deliver, or cause to be delivered, to Purchaser:

(a) the Overriding Royalty Agreement duly executed in counterpart by Vendor;
(b) an officer's certificate substantially in the form attached as Schedule "C";
(c) the AIMCo No Interest Letter;
(d) definitive documentation evidencing the maturity date extension of all outstanding indebtedness owed to AIMCo by at least thirty-six (36) months;
(e) a receipt in respect of Vendor’s receipt of the Purchase Price; and
(f) such other items as may be specifically required hereunder or as have been reasonably requested by Purchaser.
3.2 Deliveries by Purchaser at Closing

Concurrently with the execution of this Agreement, Purchaser shall pay or deliver, or cause to be paid or delivered, to Vendor:

(a) the Overriding Royalty Agreement duly executed in counterpart by Purchaser;
(b) evidence satisfactory to Vendor, acting reasonably, of the payment by Purchaser of the Purchase Price; and
(c) such other items as may be specifically required hereunder or as have been reasonably requested by Vendor.

Article 4

REPRESENTATIONS AND WARRANTIES

4.1 Representations and Warranties of Vendor

Vendor makes the following representations and warranties to Purchaser:

(a) Vendor is a corporation duly organized and validly existing under the laws of the jurisdiction of its incorporation, is authorized to carry on business in the Province in which the Royalty Lands are located, and now has good right, full power and absolute authority to sell, assign, transfer, convey and set over the Assets according to the true intent and meaning of this Agreement;
(b) the execution, delivery and performance of this Agreement has been duly and validly authorized by any and all requisite corporate, shareholders' and directors' actions on the part of Vendor and will not result in any violation of, be in conflict with or constitute a default under any governing document to which Vendor is bound;
(c) the execution, delivery and performance of this Agreement will not result in:
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(i) any violation of Applicable Laws;
(ii) any violation of, be in conflict with, or constitute a default under any term or provision of any agreement or document to which Vendor is party or by which Vendor is bound; or
(iii) except as identified in Schedule “D”, the creation of any mortgage, lien, pledge, security interest, charge or other encumbrance upon the Royalty Lands other than the Overriding Royalty;
(d) this Agreement and any other agreements delivered in connection herewith constitute valid and binding obligations of Vendor enforceable against Vendor in accordance with their terms, subject to the qualification that such enforceability may be subject to bankruptcy, insolvency, fraudulent preference, reorganization or similar laws, and general principles of equity;
(e) no authorization or approval or other action by, and no notice to or filing with, any Governmental Authority or regulatory body exercising jurisdiction over Vendor, the Royalty Lands and the Assets is required for the due execution, delivery and performance by Vendor of this Agreement, other than authorizations, approvals or exemptions from requirement therefor, previously obtained and currently in force;
(f) all notices to and consents of Third Parties that are necessary to permit the valid sale, grant and conveyance to Purchaser of the Assets have been obtained by Vendor;
(g) there are no rights of first refusal or other similar preferential rights of purchase pursuant to which any Third Party is entitled to acquire an interest in the Assets or any potion thereof;
(h) except for Permitted Encumbrances, Vendor has not alienated or encumbered the Royalty Lands or any part or portion thereof and Vendor has not committed and is not aware of there having been committed any act or omission whereby the interest of Vendor in and to the Assets or any part or portion thereof may be cancelled or terminated;
(i) except as identified in Schedule “D”, Vendor has not incurred any obligation or liability, contingent or otherwise, for brokers’ or finders’ fees in respect of this Agreement or the Transaction in respect of which Purchaser shall have any obligation or liability;
(j) Vendor is not a non-resident within the meaning of the Income Tax Act (Canada);
(k) Vendor has Good and Defensible Title to the Assets;
(l) to Vendor’s knowledge, except for the Permitted Encumbrances, all:
(i) ad valorem, property, production, severance and similar taxes and assessments based on, or measured by, the ownership of the Royalty Lands, the production of Petroleum Substances therefrom, the receipt of proceeds from the sale of such Petroleum Substances; and
(ii) royalties and rentals; accruing prior to the Effective Date that are payable by Vendor have been or will be properly paid and discharged prior to the due date thereof;
(m) except as identified in Schedule "D", no suit, action, lawsuit, administrative proceeding or other proceeding before any court or governmental agency has been commenced against Vendor or, to the knowledge, information and belief of Vendor, has been threatened against Vendor or any Third Party, which might adversely affect the consummation of the transactions contemplated by this Agreement;
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(n) to Vendor’s knowledge, Vendor has complied with, performed, observed and satisfied all material terms, conditions, obligations and liabilities under the Title and Operating Documents and Vendor has complied with all orders and directives of any Governmental Authority in respect of the Title and Operating Documents;
(o) except as identified in Schedule “D”, no Petroleum Substances produced from the Royalty Lands are subject to any agreement pursuant to which the owner of such Petroleum Substances are not entitled to take such Petroleum Substances “in kind” or otherwise market or sell such Petroleum Substances at market prices;
(p) to Vendor’s knowledge, all operations relating to the Royalty Lands (including the Royalty Wells) have been conducted in accordance with good oilfield practice and all Applicable Laws and Vendor has not received any notice of violation, and is not aware that any violation is occurring or has occurred, in respect of operations relating to the Royalty Lands (including the Royalty Wells);
(q) Vendor is not aware of and has not received any:
(i) actions, orders, reviews, investigations or directives which relate to Environmental Liabilities and which require any work, repairs, construction or capital expenditures with respect to the Royalty Lands, where such actions, orders, reviews, investigations or directives have not been complied with in all material respects; or
(ii) demands, notices or complaints issued with respect to the breach of any environmental, health or safety law applicable to the Royalty Lands, including without limitation, respecting the use, storage, treatment, transportation or disposition of environmental contaminants, which demand or notice remains outstanding as of the Effective Date;

and, except as identified in Schedule “D”, Vendor is not otherwise aware of any matter, condition or thing that has arisen with respect to the Royalty Lands that could reasonably be expected to give rise to any of the foregoing;

(r) no Casualty or Condemnation has occurred that, individually or in the aggregate, adversely affects:
(i) any portion of the Royalty Lands (including the Royalty Wells) or any portion thereof or any real or personal property that is used to operate the Royalty Lands, the Royalty Wells, and the production of Petroleum Substances therefrom or operation thereof; or
(ii) the ability of Vendor to perform its obligations under this Agreement or the Royalty Agreements; and
(s) to Vendor's knowledge, Schedule "A" sets forth and describes all of Vendor's interests in the Royalty Lands.
4.2 Representations and Warranties of Purchaser

Purchaser makes the following representations and warranties to Vendor, no claim in respect of which shall be made or be enforceable by Vendor unless written notice of such claim, with reasonable particulars, is given by Vendor to Purchaser within a period of twelve (12) months from the date hereof:

(a) Purchaser is a limited partnership duly formed and validly existing under the laws of the jurisdiction of its formation, is authorized to carry on business in the Province in which the Royalty Lands are located, and now has good right, full power and absolute authority to purchase the interest of Vendor in and to the Assets according to the true intent and meaning of this Agreement;
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(b) the execution, delivery and performance of this Agreement has been duly and validly authorized by any and all requisite actions on the part of Purchaser and will not result in any violation of, be in conflict with or constitute a default under any governing document to which Purchaser is bound;
(c) the execution, delivery and performance of this Agreement will not result in any violation of, be in conflict with or constitute a default under any term or provision of any agreement or document to which Purchaser is party or by which Purchaser is bound, nor under any Applicable Laws;
(d) this Agreement and any other agreements delivered in connection herewith constitute valid and binding obligations of Purchaser enforceable against Purchaser in accordance with their terms, subject to the qualification that such enforceability may be subject to bankruptcy, insolvency, fraudulent preference or similar laws, and general principles of equity;
(e) no authorization or approval or other action by, and no notice to or filing with, any Governmental Authority is required for the due execution, delivery and performance by Purchaser of this Agreement, other than authorizations, approvals or exemptions from requirement therefor, previously obtained and currently in force; and
(f) no suit, action, lawsuit, administrative proceeding or other proceeding before any court or governmental agency has been commenced against Purchaser or, to the knowledge, information and belief of Purchaser, has been threatened against Purchaser or any Third Party, which might adversely affect the consummation of the transactions contemplated by this Agreement.

4.3 Due Diligence

Purchaser acknowledges that it has, prior to the Effective Date, been given an opportunity to review Vendor's title to the Royalty Lands and the underlying interests subject to the Overriding Royalty Agreement, and certain operational, engineering, land and environmental matters relating to the Royalty Lands and operations by Vendor thereon and Purchaser has made its own independent investigation, analysis, evaluation and inspection of Vendor's interest in the Assets and will have relied on its own investigation, analysis, evaluation and inspection as to its assessment of the condition, quantum and value of the Assets.

Article 5

INDEMNITIES FOR REPRESENTATIONS AND WARRANTIES

5.1 Vendor's Indemnities for Representations and Warranties

Vendor shall be liable to Purchaser for and shall, in addition, indemnify the Purchaser Related Persons from and against, all losses, costs, claims, damages, expenses and liabilities suffered, sustained, paid or incurred by a Purchaser Related Person which would not have been suffered, sustained, paid or incurred had all of the representations and warranties contained in Section 4.1 been accurate.

5.2 Purchaser's Indemnities for Representations and Warranties

Purchaser shall be liable to Vendor for and shall, in addition, indemnify the Vendor Related Persons from and against, all losses, costs, claims, damages, expenses and liabilities suffered, sustained, paid or incurred by a Vendor Related Person which would not have been suffered, sustained, paid or incurred had all of the representations and warranties contained in Section 4.2 been accurate.

5.3 Limitation on Liability

Except in the event of fraud, in no event shall the total liability of either Party under this Agreement for all claims of the other Party exceed an amount equal to the Purchase Price less the royalty amounts

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paid to the date of the claim to Purchaser (or a Person designated by Purchaser to received royalty payments) under the Overriding Royalty Agreement.

5.4 Time Limitation

No claim under this Agreement, including this Article 5, shall be made or be enforceable by a Party unless written notice of such claim, with reasonable particulars, is given by such Party to the Party against whom the claim is made within a period of twelve (12) months from the date hereof.

5.5 No Consequential Damages

Except in the event of a breach by a Party of Section 6.13, in no event shall a Party be liable in respect of the covenants, agreements, representations, warranties and indemnities contained in this Agreement or in any certificate, agreement or other document furnished pursuant to this Agreement for consequential, indirect or punitive damages (including loss of anticipated profits, business interruption or any special or incidental loss of any kind only where such losses are consequential, indirect or punitive) suffered, sustained, paid or incurred by the other Party or its indemnitees, provided that this Section 5.5 shall not preclude a Party from entitlement to indemnification for such Party's liability to a Third Party for consequential, indirect or punitive damages which such Third Party suffers, sustains, pays or incurs.

Article 6 GENERAL

6.1 Further Assurances

Each Party will, from time to time and at all times after the date hereof, without further consideration, do such further acts and deliver all such further assurances, deeds and documents as shall be reasonably required in order to fully perform and carry out the terms of this Agreement.

6.2 No Merger

The covenants, representations, warranties and indemnities contained in this Agreement shall be deemed to be restated in any and all assignments, conveyances, transfers and other documents conveying the interests of Vendor in and to the Assets to Purchaser, subject to any and all time and other limitations contained in this Agreement. There shall not be any merger of any covenant, representation, warranty or indemnity in such assignments, conveyances, transfers and other documents notwithstanding any rule of law, equity or statute to the contrary and such rules are hereby waived.

6.3 Entire Agreement

The provisions contained in any and all documents and agreements collateral hereto shall at all times be read subject to the provisions of this Agreement and, in the event of conflict, subject to Section 6.12, the provisions of this Agreement shall prevail. This Agreement and the Overriding Royalty Agreement collectively supersede all other agreements, documents, writings and verbal understandings among the Parties relating to the subject matter hereof and express the entire agreement of the Parties with respect to the subject matter hereof.

6.4 Governing Law

This Agreement shall, in all respects, be subject to, interpreted, construed and enforced in accordance with and under the laws of the Province of Alberta and applicable laws of Canada and shall, in all respects, be treated as a contract made in the Province of Alberta. The Parties irrevocably attorn and submit to the exclusive jurisdiction of the courts of the Province of Alberta and courts of appeal therefrom in respect of all matters arising out of or in connection with this Agreement.

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6.5 Enurement

This Agreement may not be assigned by a Party without the prior written consent of the other Party, which consent may be unreasonably and arbitrarily withheld. This Agreement shall be binding upon and shall enure to the benefit of the Parties and their respective administrators, trustees, receivers, successors and permitted assigns, as applicable.

6.6 Time of Essence

Time shall be of the essence in this Agreement.

6.7 Notices
(a) The addresses for service and the email address of the Parties shall be as follows:

Vendor: RAZOR ENERGY CORP. Suite 800, 500 – 5th Avenue S.W. Calgary, AB T2P 3L5

Attn: Doug Bailey Email: [redacted – email address] Purchaser: RAZOR ROYALTIES LIMITED PARTNERSHIP c/o Razor Holdings GP Corp. Suite 800, 500 – 5th Avenue S.W. Calgary, AB T2P 3L5 Attention: Doug Bailey Email: [redacted – email address]

(b) All notices, communications and statements required, permitted or contemplated hereunder shall be in writing, and shall be delivered as follows:
(i) by email to a Party to the email address of such Party set out above, in which case the item so transmitted shall be deemed to have been received by that Party when properly transmitted;
(ii) except in the event of an actual or threatened postal strike or other labour disruption that may affect mail service, by mailing first class registered post, postage prepaid, to a Party at the address of such Party set out above, in which case the item so mailed shall be deemed to have been received by that Party on the third Business Day following the date of mailing (the date of mailing being the Business Day immediately prior to the postmarked date of the envelope containing the notice, communication or statement); or
(iii) by personal service on a Party at the address of such Party set out above, in which case the item so served shall be deemed to have been received by that Party when personally served.
(c) A Party may from time to time change its address for service or its email address or both by giving written notice of such change to the other Party.
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6.8 Invalidity of Provisions

In case any of the provisions of this Agreement should be invalid, illegal or unenforceable in any respect, the validity, legality or enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby.

6.9 Waiver

No failure on the part of any Party in exercising any right or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or remedy preclude any other or further exercise thereof or the exercise of any right or remedy in law or in equity or by statute or otherwise conferred. No waiver of any provision of this Agreement, including without limitation, this Section 6.9, shall be effective otherwise than by an instrument in writing dated subsequent to the date hereof, executed by a duly authorized representative of the Party making such waiver.

6.10 Amendment

This Agreement shall not be varied in its terms or amended by oral agreement or by representations or otherwise other than by an instrument in writing dated subsequent to the date hereof, executed by a duly authorized representative of each Party.

6.11 Agreement not Severable

This Agreement extends to the whole of the Assets and is not severable without Purchaser's express written consent or as otherwise herein provided.

6.12 Supremacy of Interpretation

In the event of any conflict as between the terms or provisions of this Agreement and the Overriding Royalty Agreement, the terms and provisions of the Overriding Royalty Agreement shall supersede to the extent legally permissible.

6.13 Confidentiality

The Parties agree that terms of this Agreement and the Overriding Royalty Agreement, and the Transaction contemplated hereby shall remain confidential, provided that nothing contained herein shall prevent a Party at any time from furnishing information:

(a) as permitted in accordance with the terms of the Overriding Royalty Agreement;
(b) to any Governmental Authority or to the public if required by Applicable Law, provided that the Parties shall promptly advise each other in advance, where permitted by law, of any public statement which they propose to make and if permitted by law, seek the prior written consent of the other Party, which consent shall not be unreasonably withheld;
(c) to the extent required by any applicable regulation or rule of any applicable stock exchange; or
(d) to procure such other releases and registerable discharges or no interest letters as may be required hereunder.

6.14 Counterpart Execution

This Agreement may be executed by the Parties in counterparts and may be executed and delivered by fax or email, and all the counterparts together constitute one and the same agreement.

[ Remainder of page intentionally blank. Signature page follows. ]

IN WITNESS WHEREOF the Parties have executed this Agreement with effect as of the Effective Date.

RAZOR ENERGY CORP.

Per: [signed] Doug Bailey Chief Executive Officer

RAZOR ROYALTIES LIMITED PARTNERSHIP , by its General Partner, RAZOR HOLDINGS GP CORP.

Per: [signed] Doug Bailey Chief Executive Officer

SCHEDULE "A"

Royalty Lands

[redacted – sensitive business information]

SCHEDULE "B"

Overriding Royalty Agreement

(see attached)

OVERRIDING ROYALTY AGREEMENT

THIS OVERRIDING ROYALTY AGREEMENT (“ Agreement ”) is made effective as of the Effective Date.

BETWEEN:

RAZOR ENERGY CORP. , a corporation existing under the laws of the Province of Alberta (" Royalty Payor "),

and –

RAZOR ROYALTIES LIMITED PARTNERSHIP , a limited partnership formed under the laws of the Province of Alberta (“ Royalty Owner ").

WHEREAS:

A. Pursuant to a royalty purchase and sale agreement dated as of the Effective Date between Royalty Payor and Royalty Owner (the " Sale Agreement "), Royalty Owner has purchased and acquired from Royalty Payor the Overriding Royalty; and
B. The Parties desire to provide that, from and after the Effective Date, the Royalty Lands shall be subject to the terms of this Agreement.

NOW THEREFORE in consideration of the transactions provided for under the Sale Agreement and the premises and mutual covenants hereinafter set forth, the Parties agree as follows:

ARTICLE 1

DEFINITIONS AND INTERPRETATION

1.1 Definitions

In this Agreement, unless the context otherwise requires:

(a) " Affiliate " means, in respect of a Party:
(i) a Person that Controls the Party;
(ii) a Person that is Controlled by the Party; or
(iii) a Person that is under common Control with the Party;
(b) " Agreement " has the meaning given to that term in the preamble hereof;
(c) “ AIMCo ” means Alberta Investment Management Corporation, in its capacity as agent pursuant to the AIMCo Loan Agreement, and its successors in such capacity;
(d) “ AIMCo Loan Agreement ” means the second amended and restated loan agreement among, inter alios , the Royalty Payor, as borrower, AIMCo and the lenders from time to time party thereto, as further amended, supplemented, renewed, restated or replaced from time to time;
(e) “ AIMCo Security ” means the security held by AIMCo over the assets of Royalty Payor in respect of the Royalty Payor’s indebtedness under and in connection with the AIMCo Loan Agreement;
(f) " Applicable Laws " means:
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(i) all laws and statutes, including regulations, rules, bylaws, ordinances and other statutory instruments enacted thereunder;
(ii) all judgments, decrees, rulings and orders of courts, tribunals, commissions and other similar bodies of competent jurisdictions;
(iii) all orders, rules, directives, policies and guidelines having force of law issued by any Governmental Authority; and
(iv) requirements of any stock exchange,

that are in effect as of the relevant time and are applicable to the Royalty Lands and the Parties;

(g) “ Arena ” means 405 Dolomite LLC, in its capacity as agent pursuant to the Arena Loan Agreement, and its successors in such capacity.
(h) “ Arena Loan Agreement ” means the loan agreement among, inter alios , the Royalty Owner, as borrower, Royalty Payor, as guarantor, Arena and the lenders from time to time party thereto, as amended, supplemented, renewed, restated or replaced from time to time.
(i) “ Arena Security ” means the security held by Arena over the assets of Royalty Payor and Royalty Owner in respect of the Royalty Owner’s indebtedness and Royalty Payor’s obligations under and in connection with the Arena Loan Agreement.
(j) " Business Day " means any day other than a Saturday, a Sunday or a statutory holiday in Calgary, Alberta;
(k) " Control " means the possession, directly or indirectly, by a Person or group of Persons acting in concert, of the power to direct or cause the direction of the management or policies of another Person, whether through the ownership of voting securities, by contract or otherwise;
(l) " Current Market Value " has the meaning given to that term in Schedule "B";
(m)
" Effective Date " means February 16, 2021;
(n) " Environment " includes the air, the surface and subsurface of the earth, bodies of water (including rivers, streams, lakes and aquifers) and plant, human and animal life;
(o) " Force Majeure Event " means any act, event, cause or condition that prevents a Party from performing its obligations (other than payment obligations) hereunder, but only if and to the extent such event or circumstance could not reasonably have been anticipated as at the date hereof and is beyond the affected Party’s reasonable control and was not caused, directly or indirectly, by the fault or negligence of the Party seeking to have its performance obligation excused thereby, and shall include, without limitation:
(i) acts of God, including extreme wind, ice, lightning or other storms, earthquakes, tornadoes, hurricanes, cyclones, landslides, drought, floods and washouts, fires or explosions;
(ii) local, regional or national states of emergency;
(iii) strikes and other labour disputes; or
(iv) civil disobedience or disturbances, war (whether declared or not), acts of sabotage, blockades, insurrections, terrorism, revolution, riots, pandemics or epidemics;
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(p) " Governmental Authority " means any:

(i) federal, provincial, state, municipal, local or other governmental entity or authority of any nature, including any governmental ministry, agency, branch, department or official, and any court, regulatory board or other tribunal; or
(ii) individual or body exercising, or entitled to exercise, any administrative, executive, judicial, legislative, regulatory or taxing authority or power of any nature,

having jurisdiction over the Parties or the Royalty Lands;

(q) " Overriding Royalty " means the non-convertible gross overriding royalty of nine percent (9%) payable on Royalty Payor’s Working Interest share of the gross monthly production of all Petroleum Substances produced from the Royalty Lands that is granted to Royalty Owner pursuant to Section 2.1;
(r) " Parties " means, collectively, Royalty Owner and Royalty Payer, and “ Party ” means either Royalty Owner or Royalty Payor, as applicable;
(s) " Payment Default " means the failure by Royalty Payor to pay the Overriding Royalty or any other amounts owing to Royalty Owner under this Agreement within ten (10) Business Days of receiving notice of such default from Royalty Owner;
(t) " Person " means any individual, body corporate, partnership, trust, trustee, executor or similar official, Governmental Authority or other entity and includes the Parties;
(u) " Petroleum Substances " means any of crude oil, crude bitumen and products derived therefrom, synthetic crude oil, petroleum, natural gas, natural gas liquids, and any and all other substances related to any of the foregoing, whether liquid, solid or gaseous, including without limitation sulphur and coal bed methane, but excluding coal, produced water and lithium brine;
(v) " Point of Sale " means:
(i) in the event Royalty Payor makes such election to purchase the Royalty Owner's share of the Petroleum Substances under Section 2.7, at the point immediately prior to the inlet flange of Royalty Payor's enrichment/blending facilities whereupon the applicable Petroleum Substances are metered, measured or allocated, provided such point occurs after all cleaning and processing in respect of the Petroleum Substances has been completed, including without limitation the treatment and removal of basic sediment, water (including dehydration), heat and other applicable impurities; and
(ii) in the event Royalty Payor does not make such election to purchase the Royalty Owner's share of the Petroleum Substances under Section 2.7:
- (A) in respect of Petroleum Substances produced from the Royalty Lands handled at a battery of Royalty Payor, the lease automatic custody transfer unit of the battery of Royalty Payor from which Petroleum Substances produced from the Royalty Lands can be made available for sale to an arm's length purchaser, provided that if such Petroleum Substances are handled at more than one battery of Royalty Payor, the "Point of Sale" shall refer to the lease automatic custody transfer unit of the last battery of Royalty Payor at which such Petroleum Substances are handled; and
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(B) otherwise, the first point at which Petroleum Substances produced from the Royalty Lands could ordinarily be made available for sale to an arm's length purchaser;

provided that, notwithstanding the above, should Royalty Owner elect to take in kind pursuant to Section 2.5, the point of sale shall be the point immediately prior to the inlet flange of any Third Party processing facility whereupon the applicable Petroleum Substances are metered, measured or allocated, provided such point occurs after all the treatment and removal of basic sediment, water (including dehydration) and other applicable impurities;

(w) " Price Factor " means:

(i) the actual sales price received, provided that the sale was to an arm's length purchaser; and
(ii) in all other circumstances, the greater of:
- (A) the actual sales price received; and
- (B) the Current Market Value, for the appropriate Petroleum Substance as it relates to the applicable Royalty Well;
(x) " Prime Rate " means a rate of interest equal to the annual rate of interest announced from time to time by the main Calgary branch of the Royal Bank of Canada as the reference rate then in effect for determining interest rates on Canadian dollar commercial loans in Canada;
(y)
" Royalty Determination Methodology " means the methodology described in Section 2.3(a);
(z) " Royalty Lands " means the lands and interests therein that are set forth and described in Schedule "A" insofar as rights pertaining to the Petroleum Substances underlying those lands are granted by the Title and Operating Documents, and so much of those lands as remain subject to this Agreement, the Sale Agreement and the Title and Operating Documents, together with the right to explore for and recover Petroleum Substances from within those lands, to the full extent of Royalty Payor’s Working Interest therein;
(aa) " Royalty Lands Environmental Liabilities " means all losses and liabilities that relate to the Royalty Payor's Working Interest in the Royalty Lands and Petroleum Substances attributed to Royalty Payor's Working Interest in the Royalty Lands or that arise in connection with the ownership thereof or operations pertaining thereto, whether it has arisen in the past, hereof, or hereafter, including liabilities related to or arising from:
(i) abandonment and reclamation obligations arising under or pursuant to the Applicable Laws;
(ii) past, present or future transportation, storage, use, holding or disposal of toxic or hazardous substances or waste;
(iii) leaching, migration, release, spill, escape or emission of toxic or hazardous substances or waste;
(iv) obligations to test, monitor, remediate, protect or clean-up the Environment;
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(v) the costs of complying with any environmental order or direction of any Governmental Authority having jurisdiction over the Royalty Lands or Petroleum Substances in the Royalty Lands; or
(vi) damage, pollution, contamination or other adverse situations pertaining to the Environment howsoever of or to the Environment,

and including liabilities to compensate Third Parties for damages and losses resulting from the items described in items (i), (ii), (iii), (iv) and (v) above (including damage to property, personal injury and death) and obligations to take action to prevent or rectify damage to or otherwise protect the Environment;

(bb) " Royalty Owner " has the meaning given to that term in the preamble hereof;
(cc)
" Royalty Payor " has the meaning given to that term in the preamble hereof;
(dd) " Royalty Well " means any well from which production of Petroleum Substances are obtained from the Royalty Lands or may be allocated to the Royalty Lands pursuant to a pooling, unit or other arrangement;
(ee) " Sale Agreement " has the meaning given to that term in the recitals hereof;
(ff)
“ Schedules ” has the meaning given to that term in Section 1.3;
(gg) " Spacing Unit " means the area of the Royalty Lands allocated to a Royalty Well under Applicable Laws for production of applicable Petroleum Substances therefrom;
(hh) " Term " has the meaning given to that term in Article 6;
(ii)
" Third Party " means any Person other than Royalty Payor and Royalty Owner;
(jj) " Title and Operating Documents " means, collectively, the various leases, reservations, permits, licences, agreements and other documents of title, including those set forth and described in Schedule “A”, relating to the ownership or operation by Royalty Payor of the Petroleum Substances in the Royalty Lands by virtue of which the holder is entitled to explore for, drill for, recover, own, remove or dispose of Petroleum Substances within, upon or under the Royalty Lands and all similar documents of title issued pursuant thereto, in replacement thereof or substitution therefor and all other documents relating to Royalty Payor's right, estate and interest in the Royalty Lands or the Petroleum Substances;
(ii) " Working Interest " means the right, title and interest of Royalty Payor to explore for, drill for, extract, win, produce, take, save and market Petroleum Substances from the Royalty Lands, as set out in Schedule "A";
1.2 Interpretation

Unless otherwise stated or the context otherwise necessarily requires, in this Agreement:

(a) the expressions "Article", "Section" and "Schedule" followed by a number or letter or combination thereof mean and refer to the specified article, section and schedule of or to this Agreement;
(b) words importing the singular shall include the plural and vice versa;
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(c) all monetary amounts expressed herein or calculated or to be paid pursuant hereto shall be in Canadian dollars unless otherwise specified;
(d) capitalized words and phrases used herein which are derivatives of words or phrases otherwise defined herein shall have a corresponding meaning;
(e) any reference in this Agreement to Royalty Lands shall, where provided for in the applicable Title and Operating Documents, be construed to include lands pooled or unitized with the Royalty Lands;
(f) any reference in this Agreement to an Applicable Law or to any consent, approval, permit or other authorization of a Governmental Authority shall be deemed to refer to such Applicable Law or such consent, approval, permit or other authorization of a Governmental Authority as it has been amended, supplemented, re-enacted, varied, or otherwise modified or replaced from time to time up to the applicable time;
(g) where any payment or calculation is to be made, or any other action is to be taken, on or as of a day that is not a Business Day, that payment or calculation is to be made, or that other action is to be taken, as applicable, on or as of the next following Business Day;
(h) unless otherwise specified, time periods within or following which any payment is to be made or any act is to be done under this Agreement shall be calculated by excluding the day on which the period commences and including the day on which such period ends;
(i) the use of "including" or "includes" or similar words in this Agreement, when following any general statement, term or matter, is not to be construed to limit such general statement, term or matter to the specific items immediately following such word to those or similar items, whether or not nonlimiting language (such as "without limitation" or "but not limited to" or words or phrases of similar import) is used, but rather such references shall be construed to refer to all items that could reasonably fall within the broadest possible scope of such general statement, term or matter;
(j) words such as "hereof", "herein" or "hereunder" shall mean "of", "in" or "under" this Agreement and not the specific section in which the reference occurs unless expressly otherwise noted;
(k) the headings contained in this Agreement are intended for convenience of reference only and shall form no part of this Agreement; and
(l) the rule of " contra proferentem " shall not apply to this Agreement; and
(m) terms and expressions that are not specifically defined in this Agreement, but which have generally accepted meanings in the custom and usage of the petroleum and natural gas industry in Western Canada as of the date hereof, shall have such generally accepted meanings when used in this Agreement unless the contrary is specified or provided for elsewhere in this Agreement.
1.3 Schedules

The following schedules (the " Schedules ") are attached to, form a part of and are incorporated in this Agreement:

Schedule "A" – Royalty Lands Schedule "B" – Current Market Value

ARTICLE 2

OVERRIDING ROYALTY

2.1 Grant of Overriding Royalty

Effective as of the Effective Date, and in the manner provided for in this Agreement, Royalty Payor hereby grants and sets over to Royalty Owner, and Royalty Owner hereby acquires from Royalty Payor, the Overriding Royalty, which shall comprise an interest in the Petroleum Substances within, upon or under the Royalty Lands.

2.2 Interest in Land

(a) It is the express intention of the Parties that the Overriding Royalty herein granted by Royalty Payor to Royalty Owner constitutes, and is to be construed as, an interest in land in the Royalty Lands. All terms, covenants, provisions and conditions of this Agreement shall run with and be binding upon the Royalty Lands, the Royalty Wells and the Title and Operating Documents, and the estates affected thereby for the Term.
(b) Royalty Payor acknowledges and agrees that the Overriding Royalty is capable of supporting, and Royalty Owner is entitled to, as applicable, register a caveat of its interest against Royalty Payor's Working Interest under the Land Titles Act (Alberta) and the equivalent provincial legislation in those jurisdictions where the Royalty Lands are located. Royalty Payor shall cooperate with Royalty Owner in taking any commercially reasonable actions that are necessary or appropriate to support and defend the Parties’ intentions set out in this Section 2.2, including any applicable registrations.
(c) If the Royalty Wells ever become subject to a farmout, production penalty, forfeiture or similar reduction, suspension or loss by Royalty Payor of its rights to take or be paid for any portion of its Royalty Payor’s Working Interest share of production of Petroleum Substances from the Royalty Wells after the Effective Date, Royalty Payor shall continue to be responsible to Royalty Owner for the Overriding Royalty on any such share of production of Petroleum Substances unless or until any Person acquiring or assuming that portion of the Royalty Payor’s Working Interest is assigned and novated into this Agreement and assumes the Royalty Payor’s obligations for the Overriding Royalty under this Agreement with respect to that percentage share of Royalty Payor’s Working Interest.
(d) Royalty Payor:
(i) acknowledges and agrees that it is forever estopped from taking any action whatsoever to argue, challenge, contest or contend in any manner whatsoever that the Overriding Royalty is not an interest in land;
(ii) waives any right or action that they may have to argue, challenge, contest or contend in any manner whatsoever that the Overriding Royalty is not an interest in land; and
(iii) specifically agrees not to commence any action to argue, challenge, contest or contend in any manner whatsoever that the Overriding Royalty is not an interest in land.
2.3 Quantification of Overriding Royalty
(a) Royalty Determination Methodology : The gross volume of Petroleum Substances comprising the Overriding Royalty shall be determined, on a Royalty Well by Royalty Well basis, as follows:
(i) the volume of Petroleum Substances as metered, measured or allocated at the Point of Sale shall be allocated back to each Royalty Well on a fair and reasonable basis, consistent
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with Royalty Payor's customary methodology, taking into account any usage or losses contemplated in Section 2.3(e); and

(ii) of the Petroleum Substances allocated to a Royalty Well for the Term shall be nine percent (9%) of such Petroleum Substances.
(b) Quantification of Overriding Royalty : Having regard for the Royalty Determination Methodology, the Overriding Royalty shall be quantified as follows:
(i) if not taken in kind by Royalty Owner pursuant to Section 2.5, nine percent (9%), as applicable in accordance with Section 2.3(a)(ii), of the Price Factor applicable to Royalty Payor's Working Interest share of sale of Petroleum Substances produced from each Royalty Well; and
(ii) if taken in kind by Royalty Owner pursuant to Section 2.5, nine percent (9%), as applicable in accordance with Section 2.3(a)(ii), of the Petroleum Substances applicable to the Royalty Payor’s Working Interest share produced from each Royalty Well, and available at the Point of Sale.
(c) Petroleum Substances Not Taken in Kind : For the purposes of Section 2.3(b):
(i) Appointment as Agent : Royalty Payor is appointed as the agent of Royalty Owner for the handling and disposition of the Overriding Royalty share of Petroleum Substances. When in the possession of Royalty Payor, the Petroleum Substances attributable to the Overriding Royalty and the proceeds of sale therefrom will be held as trustee for Royalty Owner and subject to the terms of this Agreement;
(ii) Sale of Petroleum Substances : Royalty Payor shall sell Royalty Owner's Overriding Royalty share of Petroleum Substances at the same price and on the same terms as Royalty Payor receives for its own share of Petroleum Substances attributable to Royalty Payor's Working Interest in the Royalty Lands, on a pro-rata basis with its own share of Petroleum Substances, provided that in connection with a sale to an Affiliate, price and terms shall not be less than the Price Factor.
(d) Deductions : Other than as set forth herein, Royalty Owner's Overriding Royalty share of Petroleum Substances produced from the Royalty Lands will be free and clear of any and all deductions whatsoever for costs and expenses incurred by Royalty Payor to and including the Point of Sale.
(e) Petroleum Substances Used in Operations : Notwithstanding the Royalty Determination Methodology and the quantification of the Overriding Royalty pursuant to Section 2.3(b), the Overriding Royalty will not include Petroleum Substances that Royalty Payor reasonably uses or loses in Royalty Payor's drilling, completion and production operations for the Royalty Lands or in the delivery of Petroleum Substances to, and handling at or prior to, the Point of Sale. Those drilling and production operations include the proportionate use of Royalty Owner's Overriding Royalty share of Petroleum Substances in batteries, treaters, compressors, separators, satellites and similar equipment serving the Royalty Wells, but do not include the use of Petroleum Substances for any enhanced recovery operations other than enhanced recovery operations on or in respect of the Royalty Lands.
(f) Other Hydrocarbons Used In Fracture Stimulation Programs : Notwithstanding the Royalty Determination Methodology and the quantification of the Overriding Royalty pursuant to Section 2.3(b), any hydrocarbon substances used in a fracture stimulation program on a Royalty Well will not be regarded as Petroleum Substances as and when recovered from that Royalty Well. This Section 2.3(f) does not modify the Royalty Payor's obligations for any such hydrocarbon substances that originally were Petroleum Substances within, upon or under the Royalty Lands or
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allocated thereto and that were produced from another Royalty Well for use in any such fracture stimulation program.

(g) Effect of Penalty Position : Notwithstanding that Royalty Payor or any permitted assignee of Royalty Payor may have elected to be in a penalty position with respect to a Royalty Well following the date hereof, Royalty Payor shall nonetheless be required to pay the Overriding Royalty, to the extent it is not paid, without any discount whatsoever, to the Royalty Owner as if Royalty Payor was not in a penalty position with respect to such Royalty Well.
(h) Effect of Pooling or Unitization on Calculation :
(i) Royalty Payor may pool the Petroleum Substances attributed to Royalty Payor's Working Interest in the Royalty Lands to the extent required to form a Spacing Unit, without the prior consent of Royalty Owner, if the pooling allocates production therefrom to the applicable Royalty Lands in the proportion that the surface area of the Royalty Lands placed on the Spacing Unit bears to the total surface area of the Spacing Unit. Royalty Payor shall promptly give notice to Royalty Owner describing the extent to which the Royalty Lands have been pooled and describing the pooled Spacing Unit.
(ii) If Royalty Payor proposes to pool, unitize or otherwise combine any portion of the Royalty Lands with any other lands, other than as provided in Section 2.3(h)(i), Royalty Payor must promptly send notice of that intention to Royalty Owner. Such notice must include the technical justification for that pooling, unitization or combination and the proposed terms thereof, provided that Royalty Payor will not be required to provide interpretive data to Royalty Owner. Royalty Owner has the right to consent or withhold consent to such proposed pooling, unitization or other combination of a portion of the Royalty Lands and must advise Royalty Payor promptly of its decision following receipt of the notice of intention from Royalty Payor.
(iii) If any portion of the Royalty Lands is pooled, unitized or combined with any other lands pursuant to this Section 2.3(h), Sections 2.3(a) and (b) will be deemed to be amended to calculate the volume of the Overriding Royalty by applying the percentages set forth in Sections 2.3(a) and (b) to the quantity of Petroleum Substances thereby attributed to Royalty Payor's Working Interest in the affected Royalty Lands, but otherwise as contemplated by Sections 2.3(a) and (b).
(i) Overriding Royalty Not Subject to Other Burdens : Except as specifically set forth herein, the Overriding Royalty shall not be subject to any royalties, burdens or other encumbrances payable by Royalty Payor in respect of Royalty Payor's Working Interest in the Royalty Lands or production of Petroleum Substances therefrom.
2.4

Monthly Accounting

(a) Royalty Payor shall remit to the Royalty Owner all funds accruing to the Royalty Owner on account of the Overriding Royalty on or before the twenty-fifth (25[th)] day of the calendar month next following the calendar month in which those funds were received by Royalty Payor; provided that, for the purpose of the timing of receipt of proceeds in this Section 2.4, "received" will be read as "normally received" if the purchaser of those Petroleum Substances fails to pay Royalty Payor for that production provided that if such failure to pay is attributable to the default of the purchaser of such Petroleum Substances, Royalty Payor shall make such remittance within ten (10) Business Days of receipt.
(b) On or about the date of remittance pursuant to Section 2.4(a), Royalty Payor will provide the Royalty Owner with a statement in written or electronic format showing, on a Royalty Well by Royalty Well
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or unit basis, as applicable, in reasonable detail the manner in which Royalty Payor calculated that payment, including:

(i) the quantity and kind of Petroleum Substances attributed to each Royalty Well on the basis of the Royalty Determination Methodology in the immediately preceding calendar month;
(ii) the unit sale price for such Petroleum Substances and the Price Factor applicable thereto; and
(iii) the quantification of the Overriding Royalty payable for such immediately preceding calendar month.
2.5

Right To Take In Kind

(a) Revocation of Agency and Election to Take in Kind : Subject to the terms of the Title and Operating Documents, on a minimum of ninety (90) days' notice to Royalty Payor, Royalty Owner may revoke the agency established in Section 2.3(c), elect to take delivery of all or a portion of the Petroleum Substances comprising the Overriding Royalty at the Point(s) of Sale and separately dispose of the same, subject to the following:
(i) the right may be exercised by Royalty Owner separately for each type of Petroleum Substances, effective at the 1st day of the calendar month next following the minimum ninety (90) day period; and
(ii) Royalty Owner shall provide Royalty Payor with evidence, satisfactory to Royalty Payor, acting reasonably, that Royalty Owner has made arrangements to take its share of Petroleum Substances and dispose of them in compliance with the Title and Operating Documents; provided that if Royalty Owner does not provide such evidence on a timely basis, or having done so does not actually take such Petroleum Substances, shall be deemed to have failed to take those Petroleum Substances in kind and Section 2.5(d) shall apply.
(b) Re-Establishment of Agency : Insofar as Royalty Owner has elected to revoke the agency established in Section 2.3(c), Royalty Owner may re-establish that agency on a minimum of ninety (90) days' notice to Royalty Payor, effective as of the 1st day of the calendar month next following the minimum ninety (90) day period. This right may be exercised separately for each type of Petroleum Substance. In connection therewith, Royalty Payor may request that Royalty Owner novate Royalty Payor (in accordance with Royalty Owner's share of Petroleum Substances elected to be taken in kind) into the transportation, marketing and sale agreements utilized by Royalty Owner for the handling and sale of such Petroleum Substances and upon such request Royalty Owner shall cause Royalty Payor to be assigned and novated into such arrangements, as Royalty Payor so elects.
(c) Royalty Payor's and Royalty Owner's Obligations :
(i) If Royalty Owner takes in-kind its Overriding Royalty share of Petroleum Substances at the Point of Sale:
- (A) Royalty Payor will, at Royalty Payor's cost, remove basic sediment and water from those Petroleum Substances to the extent it does so for its own Petroleum Substances prior to the Point of Sale;
- (B) Royalty Payor will provide Royalty Owner, at Royalty Payor's cost, production tankage capacity for an accumulation of the Overriding Royalty share of those
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Petroleum Substances consistent with Royalty Payor's ordinary course of business, provided that to the extent Royalty Payor incurs a cost incremental to what it would have incurred had Royalty Owner not taken in-kind its Overriding Royalty and accumulated its Overriding Royalty share of Petroleum Substances outside of the ordinary course, such incremental cost shall be borne by Royalty Owner;

  - (C) Royalty Payor will deliver the Overriding Royalty share of those Petroleum Substances to Royalty Owner, or Royalty Owner's nominee, at the Point of Sale free and clear of all charges except for those set forth in Section 2.5; and

  - (D) Royalty Owner will assume sole responsibility for all costs and expenses incurred for the transportation, processing or other handling of Petroleum Substances delivered to it herein and therefrom and beyond the Point of Sales.

(d) Failure to Take-in Kind : Unless otherwise agreed to by Royalty Payor and Royalty Owner, if and only if Royalty Owner elects to take its Overriding Royalty share of Petroleum Substances in kind, but fails to (or is deemed to have failed to) take possession thereof at the Point of Sale, Royalty Payor shall take possession of such Petroleum Substances as agent of Royalty Owner and shall dispose of those Petroleum Substances by:
(i) selling those Petroleum Substances at Price Factor or such lower price as is reasonable in the circumstances, adjusted for deductions, in such case only, to the Point of Sale in an amount not to exceed the reasonable costs and expenses incurred by Royalty Owner to bring those Petroleum Substances to the Point of Sale; or
(ii) purchasing those Petroleum Substances for Royalty Payor's own account (or the account of an Affiliate) at Price Factor and accounting to Royalty Owner therefor.

2.6 Royalty Payor's Allowed Deductions

(a) Required Actions to Meet Specifications : Royalty Payor may deduct against the gross proceeds of sale of the Overriding Royalty share of Petroleum Substances any such expenses incurred by Royalty Payor to enrich those Petroleum Substances in order to facilitate transportation or otherwise meet marketing, pipeline or sales specifications.
(b) Deductions Expressed As Cash Obligations : The allowable deductions from the proceeds of sale of the Royalty Owner's Overriding Royalty share of Petroleum Substances are expressed as cash obligations for convenience of record keeping and audit. This handling is not to be construed as altering the nature of the Overriding Royalty as an interest in land.

2.7 Special Enrichment and Blending Operations

Provided that Royalty Owner has not elected under Section 2.5 to take its Overriding Royalty share of the Petroleum Substances in kind, Royalty Payor shall have the option but not the obligation to purchase from Royalty Owner its Overriding Royalty share of the Petroleum Substances or such portion thereof from Royalty Owner, in connection with Royalty Payor's enrichment or blending operations, if any, at a purchase price equal to the Overriding Royalty amount for such Petroleum Substances as if such enrichment or blending operations were not being performed.

2.8 Books, Records and Audit Right

(a) Royalty Payor shall keep and maintain true and correct books, records and accounts showing credits and charges hereunder and the kind and quantity of Petroleum Substances produced from
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and attributed to Royalty Payor's Working Interest in the Royalty Lands, the disposition thereof and the price obtained therefor.

(b) Royalty Owner may, upon reasonable notice to Royalty Payor and at Royalty Owner's own expense, audit the books, records and accounts of Royalty Payor, including production accounting and marketing records, with respect to the production, disposition or sale of the Overriding Royalty within twenty-four (24) months next following the end of the applicable calendar year. Royalty Owner will conduct any such audit in accordance with PASC Joint Venture Audit Protocol Bulletin No. 6 (or any replacement therefor).
(c) Any statement issued by Royalty Payor to Royalty Owner respecting the calculation of the Overriding Royalty will be presumed to be true and correct twenty-six (26) months following the end of the calendar year in which that statement was issued, unless a Party takes bona fide written exception thereto and requests an adjustment pursuant to this Section 2.8 within that twenty-six (26) month period.
(d) Any discrepancies disclosed by such audit shall be identified in writing to Royalty Payor within sixty (60) days following the completion of such audit, and Royalty Payor shall respond in writing to any claims or discrepancies within 180 days of the receipt of such notice of claim or discrepancies. If Royalty Payor does not respond in such 180 day period, a credit for the disputed amount shall be deemed to be made in favour of Royalty Owner.
(e) To the extent that Royalty Payor and Royalty Owner are unable to resolve any outstanding claims or discrepancies disclosed by such audit within thirty (30) days of the response of Royalty Payor, such audit exceptions shall be resolved by a nationally or internationally recognized firm of chartered accountants as may be selected by Royalty Payor and Royalty Owner, which shall be requested to render its decision without qualifications, other than the usual qualifications relating to engagements of this nature, within fourteen (14) days after the dispute is referred to it.
(f) The decision of the accounting firm shall be final and binding upon the Parties and shall not be subject to appeal by any Party. The costs and expenses of the accounting firm shall be borne equally by the Parties. Notwithstanding the foregoing audit period limitation, Royalty Owner's audit rights under this Section 2.8 shall be extended for the time period, and in respect of those books, records and accounts, as may be reasonably necessary to permit Royalty Owner to verify refunds or payments to be received or made by it pursuant to this Agreement.

ARTICLE 3

OPERATIONS

3.1 Rateable Production

Subject to the occurrence of a Force Majeure Event impacting production from a Royalty Well, Royalty Payor will not discriminate against the Petroleum Substances attributed to Royalty Payor's Working Interest in the Royalty Lands in the production and marketing of those Petroleum Substances because those Petroleum Substances are subject to the Overriding Royalty. Where it is the operator of a Royalty Well, Royalty Payor will not produce Petroleum Substances from a Royalty Well inequitably with production from any diagonally or laterally offsetting well operated by Royalty Payor and producing from the same pool as a Royalty Well, insofar as the Royalty Payor, or its Affiliate, has an interest in that offsetting well, because the Petroleum Substances are subject to the Overriding Royalty.

3.2 Well Information and Additional Records

Royalty Payor will make available to Royalty Owner Royalty Payor's production volume reporting for each Royalty Well through "Data Scavenger" or such other system as provides comparable information and is used in the ordinary course of Royalty Payor's business. Further, Royalty Payor will provide Royalty

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Owner with quarterly unaudited financial statements as soon as practicable following the end of the quarter, audited annual financial statements as soon as available following the end of the fiscal year end and an annual independent reserve report prepared by a firm reasonable acceptable to Royalty Owner.

3.3 Maintenance of Royalty Lands

Royalty Payor shall, at its own cost, pay for all rentals, royalties, taxes, expenses and charges payable under the provisions of the Title and Operating Documents with respect to the Royalty Lands and any wells, facilities or equipment on the Royalty Lands and the production of the Petroleum Substances therefrom. Royalty Payor shall, at its own cost, keep the Royalty Lands and the Title and Operating Documents in good standing, provided that nothing shall require Royalty Payor to undertake any operation that would be required to extend, continue or renew a Title and Operating Document.

3.4 Surrender and Abandonment of Royalty Lands

(a) Notwithstanding anything to the contrary in this Agreement, if Royalty Payor determines bona fide and in good faith that the Title and Operating Documents pertaining to any portion of the Royalty Lands should be surrendered to the issuer of the Title and Operating Documents, or that such Title and Operating Documents should be allowed to expire, Royalty Payor shall be entitled to proceed with such surrender, or to allow such expiry to occur, and upon the surrender or expiry becoming effective the Overriding Royalty shall no longer be payable in respect of the applicable Royalty Lands, provided that if within twelve (12) months of such surrender or expiry Royalty Payor or any Affiliate of Royalty Payor acquires, directly or indirectly, a right, title, estate or interest in respect of the Royalty Lands or any portion thereof so terminated, surrendered or allowed to expire, such reacquired interest shall be subject to the Overriding Royalty and the terms and conditions of this Agreement, except to the extent such acquisition occurs as a result of an acquisition of a Person holding such right, title, estate or interest where such right, title, estate or interest does not comprise all or substantially all of such Person's assets.
(b) Royalty Payor shall have full right, power and authority without the prior consent of Royalty Owner to convert or abandon any Royalty Well if Royalty Payor determines that such Royalty Well is not capable of producing Petroleum Substances in paying quantities, as determined by Royalty Payor, acting reasonably.
(c) Royalty Payor shall provide Royalty Owner with written notice of all Title and Operating Documents that are allowed to expire.

3.5 Control Over Development

Except as otherwise provided in this Agreement, as between Royalty Payor and Royalty Owner, Royalty Payor shall have exclusive control and authority over development of, and recovery of Petroleum Substances from, the Royalty Lands including, without limitation, making all decisions respecting whether, when and how to drill, complete, equip, produce, suspend, convert, abandon and shut-in wells and whether to elect to convert royalties to working interests. In furtherance thereof, Royalty Payor shall have the right to enter into and amend the Title and Operating Documents from time to time on such terms and conditions as it considers appropriate, provided that it acts in accordance with prudent oil and gas industry practices and in good faith in connection therewith. Notwithstanding the foregoing, Royalty Payor shall not effect, or consent to effect, a change of “operator” under any of the Title and Operating Documents without the prior consent of the Royalty Owner, such consent not to be unreasonably withheld or delayed.

3.6 Restrictions on Further Royalty Grants

Notwithstanding Section 3.5, during the Term, Royalty Payor acknowledges, covenants and agrees that it shall not further grant or sell any additional overriding royalty on the Royalty Lands in any manner

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that would have a material adverse effect on Royalty Payor's ability to economically develop the Royalty Lands, taken as a whole, unless otherwise agreed to in writing by Royalty Owner, acting reasonably.

3.7 Acknowledgement and Indemnity for Operations
(a) Royalty Payor acknowledges that, except for Royalty Owner's rights and obligations under Section 2.5 with respect to Royalty Owner's right to take its Overriding Royalty share of Petroleum Substances in-kind and except as contemplated in Section 3.6(c), Royalty Owner is not liable for any of the duties and obligations arising under the Title and Operating Documents.
(b) Royalty Payor shall indemnify and save Royalty Owner, its Affiliates and each of their respective directors, officers, employees, servants and agents, harmless from and against, all actions, suits, claims, costs, demands and expenses, including legal fees on a solicitor-client basis, which may be brought against any of them or that any of them may suffer, sustain, pay or incur, by reason of any matter or thing arising out of or in any way attributable to the operations carried on by or on behalf of Royalty Payor on or in connection with Royalty Payor's Working Interest in the Royalty Lands and to the Royalty Lands Environmental Liabilities, except to the extent attributable to Petroleum Substances taken in kind by Royalty Owner or attributable to the acts or omissions of Royalty Owner or its personnel, contractors or other representatives.
(c) Royalty Owner shall indemnify and save Royalty Payor, its Affiliates and each of their respective directors, officers, employees, servants and agents, harmless from and against, all actions, suits, claims, costs, demands and expenses, including legal fees on a solicitor-client basis, which may be brought against any of them or that any of them may suffer, sustain, pay or incur, by reason of any matter or thing arising out of or in any way attributable to Petroleum Substances taken in kind by Royalty Owner or attributable to the negligence of Royalty Owner or its personnel, contractors or other representatives in connection with this Agreement.

ARTICLE 4 PAYMENT DEFAULT

4.1 Payment Default

If a Payment Default has occurred and is continuing, Royalty Owner shall have the right to:

(a) charge interest on any unpaid amounts at 5% calculated monthly from the day such payment is due until the day it is paid;
(b) set-off against any amount unpaid by Royalty Payor, any sums due or accruing to Royalty Payor or any Affiliate of Royalty Payor from Royalty Owner under this Agreement or any other agreement between Royalty Owner and Royalty Payor or any Affiliate of Royalty Payor;
(c) maintain an action or actions for such unpaid amounts and interest thereon on a continuing basis as such amounts are payable, but not paid, as if the obligation to pay such amounts and the interest thereon were liquidated demands due and payable on the relevant date such amounts were due to be paid, without any right or resort to set-off or counter-claim by Royalty Payor;
(d) either appoint a new agent to act in the place and stead of Royalty Payor for the purposes of Section 2.3(c), or to appoint itself as agent;
(e) immediately commence to take in-kind all or a portion of the Petroleum Substances comprising the Overriding Royalty in accordance with the provisions of Section 2.5, but without regard to the notice requirements set forth in Section 2.5;
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(f) review the records of Royalty Payor regarding sales of Petroleum Substances produced from Royalty Payor's Working Interest in the Royalty Lands and Royalty Payor shall be required to forthwith provide to Royalty Owner or its agent, such records; or
(g) treat the Payment Default as an immediate and automatic assignment to Royalty Owner of the proceeds of sale attributed to the Overriding Royalty share of the Petroleum Substances from the Royalty Lands, and give notice to purchasers of Petroleum Substances from Royalty Payor requiring them to pay the proceeds of sale of the Overriding Royalty share of Petroleum Substances from Royalty Lands directly to the duly appointed agent of Royalty Owner, which may be Royalty Owner, and such purchasers of Petroleum Substances shall be entitled to rely upon notice from Royalty Owner to such effect and to thereafter pay the proceeds of sale accordingly.

ARTICLE 5

ASSIGNMENT AND CHANGE OF CONTROL

5.1 Assignment by Royalty Owner

Royalty Owner may transfer or assign its interest in the Overriding Royalty, in whole or in part, on written notice to Royalty Payor; provided, however, that as a condition to the completion of such assignment Royalty Owner shall cause the assignee of Royalty Owner’s interest in the Overriding Royalty to execute and deliver to Royalty Payor an instrument in writing pursuant to which such assignee agrees to be bound by, assume and perform all of the obligations of Royalty Owner (or that portion of Royalty Owner’s interest in the Overriding Royalty being assigned) under this Agreement.

5.2 Assignment by or Change of Control of Royalty Payor

(a) Royalty Payor may not:
(i) transfer or assign its interest in this Agreement to any Person;
(ii) complete any transaction that will result in the sale, assignment, transfer, conveyance or other form of disposition of all or substantially all of its assets including, for certainty, its interest in the Royalty Lands;
(iii) complete, participate in or consent to the completion of any transaction that will result in the change of Control of Royalty Payor; or
(iv) subject to the terms and conditions of the Title and Operating Documents, change, or consent to or otherwise permit the change of, any operator of the Royalty Lands or Royalty Wells thereon;

without first receiving the written consent of Royalty Owner, which consent may not be unreasonably withheld, conditioned or delayed.

(b) Notwithstanding Section 5.2(a), Royalty Owner and Royalty Payor acknowledge and agree that: (i) Royalty Owner has assigned or will hereinafter assign, all of its right, title and interest in and to this Agreement to Arena pursuant to the Arena Security, (ii) Royalty Payor has assigned or will hereinafter assign, all of its right title and interest in and to this Agreement to AIMCo and Arena (or either of them), (iii) the grant of the Arena Security or the AIMCo Security, as applicable, shall not be restricted by this Agreement or cause a default or breach of this Agreement, and (iv) the enforcement of the Arena Security or the AIMCo Security (including the appointment of a receiver or receivers), as applicable, shall not be restricted by this Agreement or cause a default or breach of this Agreement.
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(c) In circumstances where Royalty Owner provides its consent to a transaction described in Section 5.2(a)(i) or (ii), the 1993 Canadian Association of Petroleum Landmen (CAPL) Assignment Procedure (or the most current replacement therefor then endorsed for use by CAPL) shall apply to such transaction and is hereby deemed to be incorporated by reference into this Agreement (and will be deemed to apply as if it has been made a schedule to this Agreement) using the addresses for service provided in this Agreement for the purposes of effecting such transfer or assignment by Royalty Payor. Subclause 24.04B of the standard form 2015 CAPL Operating Procedure will apply, mutatis mutandis, for the purposes of processing any notice of assignment thereunder in circumstances in which the Parties' interest are inconsistent in the Royalty Lands.

ARTICLE 6

TERM AND TERMINATION

This Agreement shall be effective as of the Effective Date and shall continue in effect until terminated by the Parties on mutual agreement (the “ Term ”).

ARTICLE 7 GENERAL

7.1 Further Assurances

Each Party will, from time to time and at all times hereafter, without further consideration, except as otherwise provided in this Agreement, do such further acts and deliver all such further assurances, deeds and documents as shall be reasonably required in order to fully perform and carry out the terms of this Agreement.

7.2 Entire Agreement

The provisions contained in any and all documents and agreements collateral or incorporated by reference hereto shall at all times be read subject to the provisions of this Agreement and, in the event of conflict, the provisions of this Agreement shall prevail. This Agreement supersedes all other agreements, documents, writings and verbal understandings among the Parties relating to the subject matter hereof and expresses the entire agreement of the Parties with respect to the subject matter hereof.

7.3 Governing Law

This Agreement shall, in all respects, be subject to, interpreted, construed and enforced in accordance with and under the laws of the Province of Alberta and applicable laws of Canada and shall, in all respects, be treated as a contract made in the Province of Alberta. The Parties hereto irrevocably attorn and submit to the exclusive jurisdiction of the courts of the Province of Alberta and courts of appeal therefrom in respect of all matters arising out of or in connection with this Agreement.

7.4 Enurement

This Agreement shall be binding upon and shall enure to the benefit of the Parties and their respective heirs, executors, administrators, trustees, receivers, successors and permitted assigns.

7.5 Time of Essence

Time shall be of the essence in this Agreement.

7.6 Notices

(a) The addresses for service and the email addresses of the Parties shall be as follows:
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Royalty Payor:

RAZOR ENERGY CORP. Suite 800, 500 - 5[th] Ave. S.W. Calgary, AB T2P 3L5

Attention: Doug Bailey Email: [redacted – email address]

Royalty Owner:

RAZOR ROYALTIES LIMITED PARTNERSHIP c/o Razor Holdings GP Corp. Suite 800, 500 - 5[th] Ave. S.W. Calgary, AB T2P 3L5

Attention: Doug Bailey Email: [redacted – email address]

(b) All notices, communications and statements required, permitted or contemplated hereunder shall be in writing, and shall be delivered as follows:
(i) by personal service on a Party at the address of such Party set out above, in which case the item so served shall be deemed to have been received by that Party when personally served;
(ii) by email to a Party to the email address of such Party set out above, in which case the item so emailed shall be deemed to have been received by that Party when property transmitted; or
(iii) except in the event of an actual or threatened postal strike or other labour disruption that may affect mail service, by mailing first class registered post, postage prepaid, to a Party at the address of such Party set out above, in which case the item so mailed shall be deemed to have been received by that Party on the third Business Day following the date of mailing (the date of mailing being the Business Day immediately prior to the postmarked date of the envelope containing the notice, communication or statement or if the subject envelope has been lost or destroyed, the date of such notice, communication or statement or if undated the date of the transmittal letter accompanying the same).
(c) A Party may from time to time change its address for service or its email address or both by giving written notice of such change to the other Party.
7.7 Invalidity of Provisions

7.8 Waiver

No failure on the part of any Party in exercising any right or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or remedy preclude any other or further exercise thereof or the exercise of any right or remedy in law or in equity or by statute or otherwise conferred. No waiver of any provision of this Agreement, including this Section 7.8, shall be effective otherwise than by an instrument in writing dated subsequent to the date hereof, executed by a duly authorized representative of the Party making such waiver.

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7.9 Amendment

7.10 Future Disclosures

Royalty Payor agrees to provide Royalty Owner (including, without limitation, any auditors, accountants, legal, engineering and other advisors engaged by Royalty Owner), at the sole risk, cost and expense of Royalty Owner, such additional information as Royalty Owner may hereafter require, and to make, at Royalty Owner's cost, available such of Royalty Payor's personnel as may be reasonably required by Royalty Owner, to satisfy any disclosure and other obligations or requirement of Royalty Owner relating to the Overriding Royalty and the Royalty Lands now or hereafter arising under any national instrument or local securities commission rule, including specifically in relation to engineering reports and data relating to the Overriding Royalty and the Royalty Lands.

7.11 Confidentiality

(a) Each Party entitled to information hereunder or pursuant to this Agreement may use such information for its sole benefit. However, the Parties shall take such measures with respect to operations and internal security as are appropriate in the circumstances to keep confidential from Third Parties all such information, except information which the Parties have expressly agreed in writing to release and information disclosed by a Party:
(i) when and to the extent required by Applicable Laws and securities regulation or policy or requested by legal process or regulatory authority applicable to such Party, provided that such Party shall provide prompt written notice to the other Party and invoke any confidentiality protection permitted by law;
(ii) to an Affiliate, provided that if such Affiliate carries on a business that includes the ownership or operation of oil and gas working interests, such Party shall cause such Affiliate to not use such confidential information in a manner so as to gain a competitive advantage over Royalty Payor or its Affiliates and shall require such of Royalty Owner's Affiliate to maintain the confidential status of the disclosed information in accordance with this Section 7.11, and such Party shall be liable for any loss suffered by the Parties, or any of them, because of the failure of such Affiliate to refrain from using the confidential information in a manner so as to gain a competitive advantage over Royalty Payor or to maintain such information confidential;
(iii) to a Third Party to which such Party has been permitted to assign its interest, or portion of its interest hereunder, provided that a binding covenant is obtained from such Third Party prior to disclosure which provides, inter alia, that none of such information shall be disclosed by it to any other Third Party; and
(iv) to the technical, financial or other professional consultants of such Party which require such information to provide their services to such Party or other financial institution from which such Party is attempting to obtain financing, provided that a binding covenant is obtained from such consultant or financier, as the case may be, prior to such disclosure, which provides, inter alia, that none of such information shall be disclosed by it to any other Third Party or used for any purposes other than advising such Party or providing financing to such Party, as applicable.

Notwithstanding the foregoing, the confidentiality obligation hereunder shall not extend to information to the extent that it is in the public domain, provided that specific items of information

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shall not be considered to be in the public domain merely because more general information is in the public domain.

(b) Notwithstanding the foregoing, any Party that ceases to be bound by the provisions of this Agreement shall nevertheless remain bound by the provisions of this Section 7.11 with respect to information obtained hereunder or pursuant to this Agreement until and to the extent that such information is in the public domain.

7.12 Limitations Act

The two-year period for seeking a remedial order under section 3(1)(a) of the Limitations Act (Alberta) for any claim (as defined therein) arising in connection with this Agreement is extended to:

(a) for claims disclosed by an audit, two (2) years after the time this Agreement permitted that audit to be performed; or
(b) for all other claims, four (4) years.

7.13 Counterpart Execution

This Agreement may be executed by the Parties in counterparts and may be executed and delivered by fax or email, and all the counterparts together constitute one and the same agreement.

[ Remainder of page intentionally blank. Signature page follows. ]

IN WITNESS WHEREOF the Parties have executed this Agreement with effect as of the Effective

Date.

RAZOR ENERGY CORP.

[signed]

Doug Bailey Chief Executive Officer

RAZOR ROYALTIES LIMITED PARTNERSHIP , by its General Partner, RAZOR HOLDINGS GP CORP.

[signed]

Doug Bailey Chief Executive Officer

SCHEDULE “A”

Royalty Lands

[redacted – sensitive business information]

SCHEDULE “B”

Current Market Value

"Current Market Value" shall mean:

(a) for crude oil:

Swanhills Area shall be Federated – Sweet (FED)

Kaybob Area shall be Pease – Sour (PSO)

Non Operated Paramount Pool A & B – Pease _ Sweet (PCE)

Badger, Chin, and Non-Operated Sanling Unit – Western Canadian Select (WCS) Jumpbush – Western Canadian Select (WCS);

(b) f or natural gas: AECO; and
(c) for NGL's and other substances: the natural gas liquid or other substance reference prices as published and posted by the Crown in the Province of Alberta, as applicable.

SCHEDULE "C"

Form of Officer's Certificate

OFFICER'S CERTIFICATE

This Certificate is delivered pursuant to Section 3.1(c) of a Royalty Purchase and Sale Agreement made effective as of February [•], 2021, between RAZOR ENERGY CORP. , as Vendor and RAZOR ROYALTIES LIMITED PARTNERSHIP , as Purchaser (the " Agreement ").

Unless otherwise stated, the definitions provided for in the Agreement are adopted in this Certificate.

I, [NAME, POSITION] of Vendor hereby certify that as of the date of this Certificate:

The representations and warranties of the Vendor in this Agreement are true and correct in all material respects (or if qualified by materiality, in all respects) as of the date hereof.
The Vendor has performed or complied in all material respects with all of its obligations, covenants and agreements contained in the Agreement.
This Certificate is made for and on behalf of Vendor and is binding upon it and the deponent herein is not incurring and will not incur any personal liability whatsoever with respect to it.
This Certificate is made with full knowledge that Purchaser is relying on the same in carrying out the Transaction.

DATED this [•] day of February, 2021.

RAZOR ENERGY CORP.

Per: Name: Title:

SCHEDULE "D"

Disclosure Schedule

Section 4.1(c)(iii) – (i) Purchaser will hereinafter assign all of its right, title and interest in and to the Royalty Agreement to Arena pursuant to the Arena Security, (ii) Vendor will hereinafter assign all of its right title and interest in and to the Royalty Agreement to AIMCo and Arena (or either of them).
Section 4.1(i) – [redacted – name] is due a finders’ fee of [redacted – dollar amount] upon Closing, which finders’ fee shall be the responsibility of Vendor.
Section 4.1(m) – [redacted – sensitive business information] .
Section 4.1(o) – [redacted – sensitive business information] .
Section 4.1(q) - On or around January 11, 2021, a pipeline release was detected and contained at the 3-20-65-10 W5M location. The release was 200m[3] of emulsion containing 90% produced water and 10% oil. Notice has been provided to all stakeholders and regulatory authorities, including the Alberta Energy Regulator (“ AER ”). Vendor took immediate steps towards remediation in accordance with its emergency response plans and in conjunction with all AER requirements.

AI assistant

Razor Energy Corp. — M&A Activity 2021

46850_rns_2021-03-01_fe59e5b9-c85d-4430-bf10-2c7721988c50.pdf

ROYALTY PURCHASE AND SALE AGREEMENT

BETWEEN:

RAZOR ENERGY CORP.

RAZOR ROYALTIES LIMITED PARTNERSHIP

ROYALTY PURCHASE AND SALE AGREEMENT

BETWEEN :

WHEREAS :

Article 1 DEFINITIONS AND INTERPRETATION

" Permitted Encumbrances " means:

1.3 Schedules

1.4 Knowledge

Article 2 PURCHASE AND SALE AND CLOSING

2.1 Purchase, Sale and Conveyance

2.2 Closing

2.3 Purchase Price

2.4 Payment of Purchase Price

2.5 GST and Other Sales Taxes

Article 3 CLOSING DELIVERIES

3.1 Deliveries by Vendor at Closing

Article 4

REPRESENTATIONS AND WARRANTIES

4.1 Representations and Warranties of Vendor

4.3 Due Diligence

Article 5

INDEMNITIES FOR REPRESENTATIONS AND WARRANTIES

5.1 Vendor's Indemnities for Representations and Warranties

5.2 Purchaser's Indemnities for Representations and Warranties

5.3 Limitation on Liability

5.4 Time Limitation

5.5 No Consequential Damages

Article 6 GENERAL

6.1 Further Assurances

6.2 No Merger

6.3 Entire Agreement

6.4 Governing Law

6.5 Enurement

6.6 Time of Essence

6.8 Invalidity of Provisions

6.9 Waiver

6.10 Amendment

6.11 Agreement not Severable

6.12 Supremacy of Interpretation

6.13 Confidentiality

6.14 Counterpart Execution

RAZOR ENERGY CORP.

SCHEDULE "A"

Royalty Lands

SCHEDULE "B"

Overriding Royalty Agreement

OVERRIDING ROYALTY AGREEMENT

BETWEEN:

WHEREAS:

ARTICLE 1

DEFINITIONS AND INTERPRETATION

(p) " Governmental Authority " means any:

(w) " Price Factor " means:

ARTICLE 2

OVERRIDING ROYALTY

2.1 Grant of Overriding Royalty

2.2 Interest in Land

Monthly Accounting

Right To Take In Kind

2.6 Royalty Payor's Allowed Deductions

2.7 Special Enrichment and Blending Operations

2.8 Books, Records and Audit Right

ARTICLE 3

OPERATIONS

3.1 Rateable Production

3.2 Well Information and Additional Records

3.3 Maintenance of Royalty Lands

3.4 Surrender and Abandonment of Royalty Lands

3.5 Control Over Development

3.6 Restrictions on Further Royalty Grants

ARTICLE 4 PAYMENT DEFAULT

ARTICLE 5

ASSIGNMENT AND CHANGE OF CONTROL

5.1 Assignment by Royalty Owner

Razor Energy Corp. M&A Activity 2021