EXHIBIT
10.3


 


AMENDMENT TO EMPLOYMENT
AGREEMENT


 


This First Amendment
(“Amendment”) is made and entered into effective as of January 1, 2004
(the “Effective Date”) to the Employment Agreement referenced below by and
between Warren Resources, Inc. (“Company” or “Employer”), and Timothy A.
Larkin, an individual (“Employee”) (together the “Parties”).


 


RECITALS


 


WHEREAS, the Parties had
entered into an Employment Agreement effective on January 1, 2001 (the
“Original Agreement”); and


 


WHEREAS, the Parties now
want to amend the Original Agreement to make such changes as are specifically
covered herein and as specifically identified in italics.


 


AGREEMENT


 


NOW, THEREFORE, for good
and valuable consideration, and in consideration of the mutual covenants and
conditions herein set forth, the receipt and sufficiency of which is hereby
acknowledged, the Parties agree as follows:


 


Section  6
(b) is hereby deleted and revised to read in its entirety as follows:


 


(b)                                 Incentive Bonus Compensation. 
In addition to the Base Compensation to which the Employee is entitled
under Section 6(a), the Employee shall be eligible to be awarded incentive
bonus compensation (the “Bonus Compensation”) with respect to each calendar
year or portion thereof during which the Employee was employed by the Company
hereunder equal to up to and including 100% of the Employee’s Base
Compensation.  The criteria for
determining the amount of the Bonus Compensation shall be determined by mutual
agreement between the Employee and the Chief Executive Officer and be approved
by the Compensation Committee of the Board of Directors. Incentive Bonus
Compensation shall be paid within 90 days following the end of the
calendar year.


 


Section 8(f) is
hereby deleted and revised to read in its entirety as follows:


 


(f)                                    Effect of Termination.


 


(i)                                     In the event of a termination of the
Employee’s employment with the Company hereunder for any reason, in addition
and subject to the provisions of Sections 8(a), 8(b), 8(c) and 8(d), the
Employee shall be entitled to receive all Base Compensation and accrued
benefits owing through the date of termination in accordance with the Company’s
normal practices then in effect.


 

















 


(ii)                                  In the event of a termination of the
Employee’s employment without Cause pursuant to Sections 8(b), 8(c) or 8(d)
above, the Company shall also pay the Employee severance compensation in
accordance with Section 8(b) above. 
Furthermore, if the Employee is terminated without Cause, or the
employment ceases under Section 8(c) or 8(d), all unvested options granted
to the Employee pursuant to the Equity Incentive Plan shall become fully
vested.


 


(iii)                               In the event of a termination of the
Employee’s employment with the Company hereunder for Cause pursuant to
Section 8(a) above, all rights of the Employee under this Agreement shall
immediately terminate and the Company shall have no further obligations
hereunder, subject to Section 8(f)(i) above and this provision.
Furthermore, if the Employee is terminated for Cause, all unvested options
granted to the Employee pursuant to the Equity Inventive Plan shall terminate.


 


**************


 


Except as set forth in
this Amendment, the Original Agreement shall remain in full force and effect
and references in the Original Agreement to “this Agreement”, “hereunder”,
“herein”, “hereof”, and words of like effect shall mean the Original Agreement
as so amended by this Amendment.


 


This Amendment may be
executed in one or more counterparts and/or by facsimile, each of which shall
be deemed an original and all of which signed counterparts, taken together,
shall constitute one instrument.


 


IN WITNESS WHEREOF, the
Parties have executed this Amendment as of the Effective Date referenced above.


 


	
   

  	
  EMPLOYER:

  
	
   

  	
   

  
	
   

  	
  WARREN RESOURCES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:
  /s/ Norman F. Swanton

  	
   

  
	
   

  	
  Name: Norman F. Swanton

  
	
   

  	
  Title:  Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Timothy A. Larkin

  	
   

  
	
   

  	
  Timothy A. Larkin