Common use of Royalties and Payment Clause in Contracts

Royalties and Payment. (a) Subject to the further provisions regarding royalties and payments below, WBSL will pay the following royalties to TPR, without duplication (each a “Royalty” and together the “Royalties”): (i) [***] per Barrel of Produced Water disposed of or transported, in either case, utilizing New Infrastructure on or within the Contiguous DBR Lands, and not ever crossing any part of the Checkerboard Lands (each such applicable Barrel of Produced Water, an “Applicable CDBRL Barrel”); (ii) [***] per Barrel of Produced Water disposed of or transported, in either case, utilizing New Infrastructure on or within the Checkerboard Lands; and (iii) [***] of gross proceeds received by WBSL from Skim Oil recovered by WBSL utilizing New Infrastructure within the AMI Lands. (b) The obligation of WBSL to pay (x) the Royalties set forth in Section 4(a)(iii) with respect to Skim Oil attributable to the Applicable CDBRL Barrels and (y) the Royalties set forth in Section 4(a)(i) shall be suspended as of the Effective Date and shall remain suspended until the [***] anniversary of the Royalty Date, or until the date that WBSL has reached [***], whichever occurs first (such earlier date, the “Capacity Achievement Date”). (i) Until the Capacity Achievement Date, in lieu of the suspended Royalties described in the introductory paragraph of this Section 4(b), WBSL shall pay to TPR [***] (the “Alternate Royalty”). (ii) [***]. (iii) The Annual Volume will be prorated as applicable for the Alternate Royalty Year in which the Capacity Achievement Date occurs and, promptly following the Capacity Achievement Date, WBSL will pay the Alternate Royalty on any remaining deficiency for the Annual Volume for any prior Alternate Royalty Year and any deficiency in the prorated Annual Volume for the current Alternate Royalty Year, if applicable. (iv) For the avoidance of doubt, the Alternate Royalty shall not apply to any Barrels of Produced Water disposed of or transported, in either case, utilizing New Infrastructure on or within the Checkerboard Lands, and WBSL shall be obligated to pay the Royalties set forth in Section 4(a)(ii) and Section 4(a)(iii) above for such Barrels. (c) Notwithstanding anything herein to the contrary, on and after the Capacity Achievement Date WBSL shall pay: (i) the Royalty set forth in Section 4(a)(i) in respect of [***] of the Applicable CDBRL Barrels up to the Capacity Threshold [***]; (ii) the Royalty set forth in Section 4(a)(i) on all Applicable CDBRL Barrels in excess of the Capacity Threshold; and (iii) the Royalty set forth in Section 4(a)(iii) on Skim Oil attributable to all Applicable CDBRL Barrels in excess of the Capacity Threshold [***]. (d) Every [***] anniversary of January 1, 2022, the Royalties [***] shall automatically be adjusted by the percentage increase in in the Consumer Price Index, as published by the Bureau of Labor Statistics of the United States Department of Labor for All Urban Consumers, specifically, the “All Items” Unadjusted Expenditure Category, for December 31, 2021 and for December 31 of the year immediately preceding the applicable increase, but in no event shall the percentage increase be less than [***] of the Royalties amounts from the previous five year term, or more than [***] of the Royalties amounts from the previous [***] year term. (e) No later than the 25th day of each month WBSL shall deliver to TPR a statement setting forth, for the preceding month, the Produced Water volumes and Skim Oil sales for which WBSL owes a payment pursuant to Sections 4(a)-(c), together with a calculation of the respective amounts owed. (f) No later than the 25th day of each month, each of DBR and TPR shall deliver to the other Party a statement setting forth, for the preceding month, any payments owed by such delivering Party pursuant to Section 5(b). (g) Payment in full of any amounts due from any Party as reflected on the applicable statement shall be made by wire transfer on or before the last business day of the subsequent month (the “Due Date”). If a Party fails to pay the amount of any statement within 60 days after the date of such statement, interest on such amounts will accrue from the Due Date through and including the date such Party actually makes payment, at the Overdue Rate. (h) At any time on no less than 30 days’ notice (but no more frequently than twice in any 12-month period so long as a Default by the other Party is not occurring), any Party may, at the sole cost and expense of such Party, conduct an audit of any other Party’s records, including the examination of accounts, invoices and other documents related to the AMI Lands and/or operations pursuant to this Agreement, and including records of Produced Water disposed of, and/or transported, as the case may be. Such examination shall use electronic records or, solely to the extent original documents are required, take place in the office location where such books and records are kept in the normal course of business; provided that no examination may unreasonably interfere in the ongoing job responsibilities of the personnel of any Party. (i) WBSL shall provide, operate and maintain properly calibrated flow meters at each (i) SWD Well owned or operated by WBSL on the AMI Lands, (ii) point at which one of WBSL’s Produced Water pipelines brings Produced Water onto the AMI Lands, (iii) point at which one of WBSL’s Produced Water pipelines brings Produced Water onto the Checkerboard Lands from the Contiguous DBR Lands, (iv) receipt point on the AMI Lands at which Produced Water originally produced on the AMI Lands enters WBSL’s Produced Water Facilities, and (v) any other necessary locations on the Produced Water Facilities, all to the extent necessary to calculate the amounts owed by any WBSL Party pursuant to Section 4 and in compliance with all Applicable Laws, rules and regulations. (j) [***]

Royalties and Payment. 5.1 In consideration of the rights granted by Licensor to the Licensee under this Agreement, the Licensee agrees to pay to Licensor: (a) Subject to the further provisions regarding royalties and payments below, WBSL will pay the following royalties to TPR, without duplication (each a “Royalty” and together the “Royalties”): (i) non-refundable sum of [***] per Barrel of Produced Water disposed of or transportedpayable on March 31, in either case, utilizing New Infrastructure on or within the Contiguous DBR Lands, and not ever crossing any part of the Checkerboard Lands 2003 (each such applicable Barrel of Produced Water, an “Applicable CDBRL BarrelAnnual Payment Date”). The foregoing payment includes full payment for all sales by the Licensee of Products before the effective date of this Agreement; (iib) a sum of [***] per Barrel payable on each anniversary of Produced Water disposed the Annual Payment Date during the term of or transported, in either case, utilizing New Infrastructure on or within the Checkerboard Landsthis Agreement; and (iii) [***] of gross proceeds received by WBSL from Skim Oil recovered by WBSL utilizing New Infrastructure within the AMI Lands. (b) The obligation of WBSL to pay (x) the Royalties set forth in Section 4(a)(iii) with respect to Skim Oil attributable to the Applicable CDBRL Barrels and (y) the Royalties set forth in Section 4(a)(i) shall be suspended as of the Effective Date and shall remain suspended until the [***] anniversary of the Royalty Date, or until the date that WBSL has reached [***], whichever occurs first (such earlier date, the “Capacity Achievement Date”). (i) Until the Capacity Achievement Date, in lieu of the suspended Royalties described in the introductory paragraph of this Section 4(b), WBSL shall pay to TPR [***] (the “Alternate Royalty”). (ii) [***]. (iii) The Annual Volume will be prorated as applicable for the Alternate Royalty Year in which the Capacity Achievement Date occurs and, promptly following the Capacity Achievement Date, WBSL will pay the Alternate Royalty on any remaining deficiency for the Annual Volume for any prior Alternate Royalty Year and any deficiency in the prorated Annual Volume for the current Alternate Royalty Year, if applicable. (iv) For the avoidance of doubt, the Alternate Royalty shall not apply to any Barrels of Produced Water disposed of or transported, in either case, utilizing New Infrastructure on or within the Checkerboard Lands, and WBSL shall be obligated to pay the Royalties set forth in Section 4(a)(ii) and Section 4(a)(iii) above for such Barrels. (c) Notwithstanding anything herein to the contrary, on and after the Capacity Achievement Date WBSL shall pay: (i) the Royalty set forth in Section 4(a)(i) in respect a royalty of [***] of the Applicable CDBRL Barrels up Net Sales of all Products sold by the Licensee during the term of this Agreement. Sums paid under Subsections 5.1 (a) and (b) above, and Section 5.2 below, shall be fully creditable against such royalties, regardless of the year in which such royalties accrue. 5.2 At any time(s) during the first twelve (12) months of the term of this Agreement, Licensee shall be entitled, at its option, to add one or both Option Fields of Use to the Capacity Threshold [***]; Licensed Field of Use under this Agreement, and upon each such exercise, each such Option Field of Use shall become a Licensed Field of Use under this Agreement. If Licensee has not, during the first twelve (ii12) the Royalty set forth in Section 4(a)(i) on all Applicable CDBRL Barrels in excess month period of the Capacity Threshold; and term of this Agreement, added both Option Fields of Use to the Licensed Field of Use, then during the second twelve (iii12) the Royalty set forth in Section 4(a)(iii) on Skim Oil attributable to all Applicable CDBRL Barrels in excess month period of the Capacity Threshold [***]. term of this Agreement, Licensee shall be entitled, at its option, to add one Option Field of Use to the Licensed Field of Use under this Agreement. Each such exercise of this option by Licensee shall be by written notice to Licensor, referencing this Agreement and specifying the Option Field(s) of Use to be added. Within thirty (d30) Every days after such exercise, Licensee shall pay an additional [***] anniversary license fee for the first added Option Field of January 1Use, 2022, the Royalties and an additional [***] license fee for the second added Option Field of Use. For the avoidance of doubt, during the first twelve (12) month period of the term of this Agreement, Licensee may exercise this option for one or both Option Fields of Use and on one or two occasions. 5.3 Within thirty (30) days of the end of each calendar quarter the Licensee shall automatically pay to Licensor the royalty having accrued on the Products sold during such calendar quarter to the extent the royalty exceeds the credited sums paid by Licensee. Such payments shall be adjusted made in US Dollars by wire transfer, at the percentage increase Licensee’s cost, to such bank as shall be notified by Licensor. Payments of royalties accrued on sales in other currencies than US Dollars shall be made in US Dollars at the rate of exchange quoted by a first class commercial bank in the Consumer Price Index, as published by Licensee’s country on the Bureau of Labor Statistics last day of the United States Department relevant calendar quarter. 5.4 If the Licensee fails to make the payments as provided for herein, such amounts shall bear interest from and after the due date at the rate of Labor for All Urban Consumers, specifically, the “All Items” Unadjusted Expenditure Category, for December 31, 2021 and for December 31 of the year immediately preceding the applicable increase, but in no event shall the percentage increase be less than [***] above the one month LIBOR for the currency of payment. 5.5 Withholding or other taxes assessed on Licensor in connection with the payment of royalties and other consideration due hereunder and which the Licensee is required by law to deduct and withhold when making payments, may be deducted from royalty payments hereunder (including without limitation payments under Sections 5.1(a), 5.1(b), and 5.2) and shall be paid by the Licensee to the competent authority on behalf of Licensor. The originals of the Royalties amounts from official government receipt for such taxes paid by the previous five year termLicensee on Licensor’s behalf, or more than [***] of shall so indicate such fact and shall be sent by the Royalties amounts from the previous [***] year term. (e) No Licensee to Licensor not later than the 25th day of each month WBSL shall deliver to TPR a statement setting forth, for the preceding month, the Produced Water volumes and Skim Oil sales for which WBSL owes a payment pursuant to Sections 4(a)-(c), together with a calculation of the respective amounts owed. fifteen (f15) No later than the 25th day of each month, each of DBR and TPR shall deliver to the other Party a statement setting forth, for the preceding month, any payments owed by such delivering Party pursuant to Section 5(b). (g) Payment in full of any amounts due from any Party as reflected on the applicable statement shall be made by wire transfer on or before the last business day of the subsequent month (the “Due Date”). If a Party fails to pay the amount of any statement within 60 working days after the date of such statement, interest on such amounts will accrue from the Due Date through and including the date such Party actually makes payment, at indicating net payment of royalties to which such taxes relate, and in accordance with the Overdue Rate. (h) At any time on no less than 30 days’ notice (but no more frequently than twice in any 12-month period instructions given by Licensor. The sums so long as a Default paid by the other Party is not occurring), any Party may, at the sole cost and expense of such Party, conduct an audit of any other Party’s records, including the examination of accounts, invoices and other documents related to the AMI Lands and/or operations pursuant to this Agreement, and including records of Produced Water disposed of, and/or transported, as the case may be. Such examination Licensee shall use electronic records or, solely to the extent original documents are required, take place be credited by Licensor in the office location where such books and records are kept in the normal course of business; provided that no examination may unreasonably interfere in the ongoing job responsibilities partial discharge of the personnel of any PartyLicensee’s obligation for gross royalties as provided for herein. (i) WBSL shall provide, operate and maintain properly calibrated flow meters at each (i) SWD Well owned or operated by WBSL on the AMI Lands, (ii) point at which one of WBSL’s Produced Water pipelines brings Produced Water onto the AMI Lands, (iii) point at which one of WBSL’s Produced Water pipelines brings Produced Water onto the Checkerboard Lands from the Contiguous DBR Lands, (iv) receipt point on the AMI Lands at which Produced Water originally produced on the AMI Lands enters WBSL’s Produced Water Facilities, and (v) any other necessary locations on the Produced Water Facilities, all to the extent necessary to calculate the amounts owed by any WBSL Party pursuant to Section 4 and in compliance with all Applicable Laws, rules and regulations. (j) [***]

Royalties and Payment. (a4.01 LICENSEE shall pay LICENSOR a royalty on the NET SALES of all ROYALTY- BASE PRODUCTS of LICENSEE and its included AFFILIATE(S) Subject and sublicensees sold to the further provisions regarding royalties and payments below, WBSL will pay the following royalties to TPR, without duplication (each a “Royalty” and together the “Royalties”): (i) [***] per Barrel of Produced Water third- parties or otherwise disposed of or transported, in either case, utilizing New Infrastructure on or within the Contiguous DBR Lands, and not ever crossing any part of the Checkerboard Lands (each such applicable Barrel of Produced Water, an “Applicable CDBRL Barrel”); (ii) [***] per Barrel of Produced Water disposed of or transported, in either case, utilizing New Infrastructure on or within the Checkerboard Lands; and (iii) [***] of gross proceeds received by WBSL from Skim Oil recovered by WBSL utilizing New Infrastructure within the AMI Lands. (b) LICENSED TERRITORY. The obligation of WBSL to pay (x) the Royalties set forth in Section 4(a)(iii) with respect to Skim Oil attributable to the Applicable CDBRL Barrels and (y) the Royalties set forth in Section 4(a)(i) royalty rate for all ROYALTY-BASE PRODUCTS shall be suspended as of the Effective Date and shall remain suspended until the [***] anniversary of the Royalty Date, or until the date that WBSL has reached [***], whichever occurs first (such earlier date, the “Capacity Achievement Date”). (i) Until the Capacity Achievement Date, in lieu of the suspended Royalties described in the introductory paragraph of this Section 4(b), WBSL shall pay to TPR [***] (the “Alternate Royalty”). (ii) [***]. 4.02 No royalty shall be payable under paragraph 4.01 above with respect to sales of ROYALTY-BASE PRODUCTS among LICENSEE and its AFFILIATE(S) or Sublicensees, nor shall a royalty be payable under this Article IV with respect to ROYALTY-BASE PRODUCTS distributed for use in research and/or development, in clinical trials, or as promotional samples. 4.03 Royalties due under this Article IV shall be payable on a country-by-country and ROYALTY-BASE PRODUCT-by-ROYALTY-BASE PRODUCT basis until the expiration of the last-to-expire issued VALID CLAIM covering such ROYALTY-BASE PRODUCT in such country, (iii) The Annual Volume will be prorated as applicable for the Alternate Royalty Year or if no such patent has issued in a country in which an application is pending, until the Capacity Achievement Date occurs andfifth anniversary of the first commercial sale of a ROYALTY-BASE PRODUCT in such country). 4.04 If it is determined by a competent court, promptly following or by mutual agreement of the Capacity Achievement Dateparties hereto, WBSL will pay the Alternate Royalty on any remaining deficiency for the Annual Volume for any prior Alternate Royalty Year and any deficiency that LICENSEE must avoid infringement by acquiring a license from another party in the prorated Annual Volume for the current Alternate Royalty Yearcourse of practicing LICENSOR's LICENSED PATENT APPLICATION, if applicable. (iv) For the avoidance of doubtthen LICENSEE may offset any amounts paid to such third party against royalties due LICENSOR, the Alternate Royalty shall not apply to any Barrels of Produced Water disposed of or transported, in either case, utilizing New Infrastructure on or within the Checkerboard Lands, and WBSL shall be obligated to pay the Royalties set forth in Section 4(a)(ii) and Section 4(a)(iii) above for such Barrels. (c) Notwithstanding anything herein to the contrary, on and after the Capacity Achievement Date WBSL shall pay: (i) the Royalty set forth in Section 4(a)(i) in respect of [***] of the Applicable CDBRL Barrels up to the Capacity Threshold [***]; (ii) the Royalty set forth in Section 4(a)(i) on all Applicable CDBRL Barrels in excess of the Capacity Threshold; and (iii) the Royalty set forth in Section 4(a)(iii) on Skim Oil attributable to all Applicable CDBRL Barrels in excess of the Capacity Threshold [***]. (d) Every 4.05 For prototype products in the early part of the product life cycle before sales to third parties, instead of NET SALES, milestone payments shall be required at certain stages of the product development cycle. LICENSEE shall pay LICENSOR according to the following schedule: a. LICENSEE shall pay to LICENSOR [*]. b. LICENSEE shall pay to LICENSOR [*]. c. LICENSEE shall pay to LICENSOR [*] anniversary ]. 4.06 Royalties shall be payable in United States dollars, paid by check to the "Finance and Accounting Officer, U.S. Army Research Laboratory" and mailed to Commander, U.S. Army Research Laboratory, ATTN: AMSRL-OP-XX-XX-DI, 0000 Xxxxxx Xxxx Xxxx, Xxxxxxx, Xxxxxxxx 00000-0000. All checks and bank drafts shall be drawn on United States banks. 4.07 For purposes of January 1, 2022converting currencies other than U.S. Dollars to U.S. Dollars, the Royalties [***] shall automatically be adjusted by the percentage increase in current exchange rate as reported in the Consumer Price IndexWall Street Journal under the column headed "Currency Trading" and subtitled "Exchange Rates" for the last Tuesday of the calendar quarter in which the sales were made shall be used. Any and all loss of exchange, value, taxes or other expenses incurred in the transfer or conversion of other currency to United States dollars shall be paid entirely by LICENSEE. 4.08 In the event that LICENSEE is unable, as published a result of any legal or government restrictions to remit royalties from any country in the LICENSED TERRITORY in respect of sales in that country, LICENSEE shall deposit the appropriate royalties in an account in a bank in such country agreed to by LICENSOR, such agreement not to be unreasonably withheld. For as long as such a restriction applies, LICENSEE shall be relieved of any further obligations to LICENSOR in respect of such royalties except that of reporting to LICENSOR under ARTICLE V concerning the Bureau amount of Labor Statistics of the United States Department of Labor royalty payable and so deposited. 4.09 LICENSEE shall pay royalties accrued for All Urban Consumers, specifically, the “All Items” Unadjusted Expenditure Category, for December 31, 2021 sales made subject to such royalties to include sales by its AFFILIATE(S) and for December 31 of the year immediately preceding the applicable increase, but in no event shall the percentage increase be less sublicensees not later than [***] ]. LICENSEE shall submit with its payment the written report required in ARTICLE V, paragraph 5.03 of this Agreement. If no royalties are due, the Royalties amounts from the previous five year term, or more than [***] of the Royalties amounts from the previous [***] year term. (e) No later than the 25th day of each month WBSL report shall deliver so state. Sales shall be considered to TPR a statement setting forthbe made, for the preceding monthpurposes of this paragraph, the Produced Water volumes and Skim Oil sales for which WBSL owes a payment pursuant to Sections 4(a)-(c)when billed out, together with a calculation except that upon any termination of the respective amounts owed. (f) No later than the 25th day of each month, each of DBR and TPR shall deliver to the other Party a statement setting forth, for the preceding month, any payments owed by such delivering Party pursuant to Section 5(b). (g) Payment in full of any amounts due from any Party as reflected on the applicable statement shall be made by wire transfer on or before the last business day of the subsequent month (the “Due Date”). If a Party fails to pay the amount of any statement within 60 days after the date of such statement, interest on such amounts will accrue from the Due Date through and including the date such Party actually makes payment, at the Overdue Rate. (h) At any time on no less than 30 days’ notice (but no more frequently than twice in any 12-month period so long as a Default by the other Party is not occurring), any Party may, at the sole cost and expense of such Party, conduct an audit of any other Party’s records, including the examination of accounts, invoices and other documents related to the AMI Lands and/or operations pursuant to this Agreement, all shipments made on or prior thereto shall be considered as sold (and including records therefore subject to royalty). Royalties paid on sales of Produced Water disposed of, and/or transported, as ROYALTY-BASE PRODUCTS which are not accepted by the case may be. Such examination customer shall use electronic records or, solely be credited to LICENSEE. 4.10 LICENSEE shall pay within [*] any termination of this Agreement royalties accrued or accruable for payment at the time of any such termination. 4.11 Royalty payments not received by LICENSOR by the due date shall be subject to interest charges computed at [*]. 4.12 No royalty shall be payable under this Agreement for direct sales of ROYALTY- BASE PRODUCTS by LICENSEE to the extent original documents are required, take place in GOVERNMENT or any of its agencies for governmental purposes or for sales made for the office location where such books and records are kept in the normal course purpose of business; provided that no examination may unreasonably interfere in the ongoing job responsibilities of the personnel of any Partyconducting clinical trials. (i) WBSL shall provide, operate and maintain properly calibrated flow meters at each (i) SWD Well owned or operated by WBSL on the AMI Lands, (ii) point at which one of WBSL’s Produced Water pipelines brings Produced Water onto the AMI Lands, (iii) point at which one of WBSL’s Produced Water pipelines brings Produced Water onto the Checkerboard Lands from the Contiguous DBR Lands, (iv) receipt point on the AMI Lands at which Produced Water originally produced on the AMI Lands enters WBSL’s Produced Water Facilities, and (v) any other necessary locations on the Produced Water Facilities, all to the extent necessary to calculate the amounts owed by any WBSL Party pursuant to Section 4 and in compliance with all Applicable Laws, rules and regulations. (j) [***]

Royalties and Payment. 5.1 In consideration of the rights granted by Licensor to the Licensee under this Agreement, the Licensee agrees to pay to Licensor: (a) Subject to the further provisions regarding royalties and payments below, WBSL will pay the following royalties to TPR, without duplication (each a “Royalty” and together the “Royalties”): (i) non-refundable sum of [***] per Barrel of Produced Water disposed of or transportedpayable on March 31, in either case, utilizing New Infrastructure on or within the Contiguous DBR Lands, and not ever crossing any part of the Checkerboard Lands 2003 (each such applicable Barrel of Produced Water, an “Applicable CDBRL BarrelAnnual Payment Date”). The foregoing payment includes full payment for all sales by the Licensee of Products before the effective date of this Agreement; (iib) a sum of [***] per Barrel payable on each anniversary of Produced Water disposed the Annual Payment Date during the term of or transported, in either case, utilizing New Infrastructure on or within the Checkerboard Landsthis Agreement; and (iii) [***] of gross proceeds received by WBSL from Skim Oil recovered by WBSL utilizing New Infrastructure within the AMI Lands. (b) The obligation of WBSL to pay (x) the Royalties set forth in Section 4(a)(iii) with respect to Skim Oil attributable to the Applicable CDBRL Barrels and (y) the Royalties set forth in Section 4(a)(i) shall be suspended as of the Effective Date and shall remain suspended until the [***] anniversary of the Royalty Date, or until the date that WBSL has reached [***], whichever occurs first (such earlier date, the “Capacity Achievement Date”). (i) Until the Capacity Achievement Date, in lieu of the suspended Royalties described in the introductory paragraph of this Section 4(b), WBSL shall pay to TPR [***] (the “Alternate Royalty”). (ii) [***]. (iii) The Annual Volume will be prorated as applicable for the Alternate Royalty Year in which the Capacity Achievement Date occurs and, promptly following the Capacity Achievement Date, WBSL will pay the Alternate Royalty on any remaining deficiency for the Annual Volume for any prior Alternate Royalty Year and any deficiency in the prorated Annual Volume for the current Alternate Royalty Year, if applicable. (iv) For the avoidance of doubt, the Alternate Royalty shall not apply to any Barrels of Produced Water disposed of or transported, in either case, utilizing New Infrastructure on or within the Checkerboard Lands, and WBSL shall be obligated to pay the Royalties set forth in Section 4(a)(ii) and Section 4(a)(iii) above for such Barrels. (c) Notwithstanding anything herein to the contrary, on and after the Capacity Achievement Date WBSL shall pay: (i) the Royalty set forth in Section 4(a)(i) in respect a royalty of [***] of the Applicable CDBRL Barrels up Net Sales of all Products sold by the Licensee during the term of this Agreement. Sums paid under Subsections 5.1 (a) and (b) above, and Section 5.2 below, shall be fully creditable against such royalties, regardless of the year in which such royalties accrue. 5.2 At any time(s) during the first twelve (12) months of the term of this Agreement, Licensee shall be entitled, at its option, to add one or both Option Fields of Use to the Capacity Threshold [***]; (ii) Licensed Field of Use under this Agreement, and upon each such exercise, each such Option Field of Use shall become a Licensed Field of Use under this Agreement. If Licensee has not, during the Royalty set forth in Section 4(a)(i) on all Applicable CDBRL Barrels in excess of the Capacity Threshold; and (iii) the Royalty set forth in Section 4(a)(iii) on Skim Oil attributable to all Applicable CDBRL Barrels in excess of the Capacity Threshold [***]. (d) Every first [***] anniversary Information has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions. twelve (12) month period of January 1the term of this Agreement, 2022added both Option Fields of Use to the Licensed Field of Use, then during the Royalties second twelve (12) month period of the term of this Agreement, Licensee shall be entitled, at its option, to add one Option Field of Use to the Licensed Field of Use under this Agreement. Each such exercise of this option by Licensee shall be by written notice to Licensor, referencing this Agreement and specifying the Option Field(s) of Use to be added. Within thirty (30) days after such exercise, Licensee shall pay an additional [***] shall automatically be adjusted by license fee for the percentage increase in in the Consumer Price Indexfirst added Option Field of Use, as published by the Bureau of Labor Statistics of the United States Department of Labor for All Urban Consumers, specifically, the “All Items” Unadjusted Expenditure Category, for December 31, 2021 and for December 31 of the year immediately preceding the applicable increase, but in no event shall the percentage increase be less than an additional [***] license fee for the second added Option Field of Use. For the avoidance of doubt, during the first twelve (12) month period of the Royalties term of this Agreement, Licensee may exercise this option for one or both Option Fields of Use and on one or two occasions. 5.3 Within thirty (30) days of the end of each calendar quarter the Licensee shall pay to Licensor the royalty having accrued on the Products sold during such calendar quarter to the extent the royalty exceeds the credited sums paid by Licensee. Such payments shall be made in US Dollars by wire transfer, at the Licensee’s cost, to such bank as shall be notified by Licensor. Payments of royalties accrued on sales in other currencies than US Dollars shall be made in US Dollars at the rate of exchange quoted by a first class commercial bank in the Licensee’s country on the last day of the relevant calendar quarter. 5.4 If the Licensee fails to make the payments as provided for herein, such amounts shall bear interest from and after the previous five year term, or more than due date at the rate of [***] above the one month LIBOR for the currency of payment. 5.5 Withholding or other taxes assessed on Licensor in connection with the payment of royalties and other consideration due hereunder and which the Licensee is required by law to deduct and withhold when making payments, may be deducted from royalty payments hereunder (including without limitation payments under Sections 5.1(a), 5.1(b), and 5.2) and shall be paid by the Licensee to the competent authority on behalf of Licensor. The originals of the Royalties amounts from official government receipt for such taxes paid by the previous [***] year term. (e) No Licensee on Licensor’s behalf, shall so indicate such fact and shall be sent by the Licensee to Licensor not later than the 25th day of each month WBSL shall deliver to TPR a statement setting forth, for the preceding month, the Produced Water volumes and Skim Oil sales for which WBSL owes a payment pursuant to Sections 4(a)-(c), together with a calculation of the respective amounts owed. fifteen (f15) No later than the 25th day of each month, each of DBR and TPR shall deliver to the other Party a statement setting forth, for the preceding month, any payments owed by such delivering Party pursuant to Section 5(b). (g) Payment in full of any amounts due from any Party as reflected on the applicable statement shall be made by wire transfer on or before the last business day of the subsequent month (the “Due Date”). If a Party fails to pay the amount of any statement within 60 working days after the date of such statement, interest on such amounts will accrue from the Due Date through and including the date such Party actually makes payment, at indicating net payment of royalties to which such taxes relate, and in accordance with the Overdue Rate. (h) At any time on no less than 30 days’ notice (but no more frequently than twice in any 12-month period instructions given by Licensor. The sums so long as a Default paid by the other Party is not occurring), any Party may, at the sole cost and expense of such Party, conduct an audit of any other Party’s records, including the examination of accounts, invoices and other documents related to the AMI Lands and/or operations pursuant to this Agreement, and including records of Produced Water disposed of, and/or transported, as the case may be. Such examination Licensee shall use electronic records or, solely to the extent original documents are required, take place be credited by Licensor in the office location where such books and records are kept in the normal course of business; provided that no examination may unreasonably interfere in the ongoing job responsibilities partial discharge of the personnel of any PartyLicensee’s obligation for gross royalties as provided for herein. (i) WBSL shall provide, operate and maintain properly calibrated flow meters at each (i) SWD Well owned or operated by WBSL on the AMI Lands, (ii) point at which one of WBSL’s Produced Water pipelines brings Produced Water onto the AMI Lands, (iii) point at which one of WBSL’s Produced Water pipelines brings Produced Water onto the Checkerboard Lands from the Contiguous DBR Lands, (iv) receipt point on the AMI Lands at which Produced Water originally produced on the AMI Lands enters WBSL’s Produced Water Facilities, and (v) any other necessary locations on the Produced Water Facilities, all to the extent necessary to calculate the amounts owed by any WBSL Party pursuant to Section 4 and in compliance with all Applicable Laws, rules and regulations. (j) [***]