Document:

Exhibit 10.3

 

STOCKHOLDER AGREEMENT

 

THIS STOCKHOLDER AGREEMENT (the “Agreement”) is entered into as of May
21, 2004, by and among Forest Oil
Corporation, a New York corporation (together with its successors,
“Parent”), TWOCO Acquisition Corp.,
a Delaware corporation and a wholly owned subsidiary of Parent (“Merger
Subsidiary”), and the stockholder listed on Schedule I hereto (the
“Stockholder”) of The Wiser Oil Company,
a Delaware corporation (the “Company”).

 

RECITALS

 

Parent, Merger Subsidiary and the Company are entering into an
Agreement and Plan of Merger of even date herewith (the “Merger Agreement”)
which provides, among other things, that Merger Subsidiary will make a cash
tender offer (the “Offer”) for all of the issued and outstanding shares of Company
Common Stock (as defined below) and, following the consummation of the Offer,
will merge with and into the Company (the “Merger”), in each case upon the
terms and subject to the conditions set forth in the Merger Agreement.

 

The Stockholder is the beneficial owner (as defined in Rule 13d-3 under
the Exchange Act) of such number of securities of the Company as indicated on
the Schedule I to this Agreement; and

 

In order to induce Parent and Merger Subsidiary to enter into the
Merger Agreement, the Stockholder is entering into this Agreement.

 

NOW, THEREFORE, intending to be legally bound, the parties hereto agree
as follows:

 

Section 1.                      Certain Definitions.

 

For purposes of this Agreement:

 

(a)           “Company Common Stock” shall mean the
common stock, par value $0.01 per share, of the Company.

 

(b)           “Company Warrants” shall mean
warrants to purchase 741,716 shares of Company Common Stock at an exercise
price of $4.25 per share.

 

(c)           “Expiration Date” shall mean the
earliest of:

 

(i)                    the date
upon which the Merger Agreement is validly terminated pursuant to Section 8.01
thereof;

 

(ii)                   the date on
which the Parent or Merger Subsidiary shall have purchased and paid for all of
the Subject Securities;

 

(iii)                  the date
upon which the Merger becomes effective;

 

 

(iv)                  the date
upon which the Merger Agreement is amended to reduce the Offer Price or in any
other manner adverse in any material respect to the Stockholder; and

 

(v)                   the End
Date.

 

(d)           The Stockholder shall be deemed to
“Own” or to have acquired “Ownership” of a security if the Stockholder is the
record and/or beneficial owner (as defined in Rule 13d-3 under the Exchange
Act) of such security.

 

(e)           “Person” shall mean any individual,
corporation, limited liability company, partnership, trust or other entity, or
governmental authority.

 

(f)            “Subject Securities” shall mean: (i)
all securities of the Company (including all shares of Company Common Stock and
all options and other rights to acquire shares of Company Common Stock
including Company Warrants) Owned by the Stockholder as of the date of this
Agreement; and (ii) all additional securities of the Company (including all
additional shares of Company Common Stock and all additional options and other
rights to acquire shares of Company Common Stock) of which the Stockholder
acquires Ownership during the period from the date of this Agreement through
the Expiration Date.

 

(g)           A Person shall be deemed to have a
effected a “Transfer” of a security if such Person directly or indirectly: (i)
sells, pledges, encumbers, grants an option with respect to, transfers,
distributes or disposes of such security or any interest in such security; (ii)
enters into an agreement or commitment contemplating the possible sale of,
pledge of, encumbrance of, grant of an option with respect to, transfer of or
disposition of such security or any interest therein; (iii) grants any proxy,
power-of-attorney or other authorization or consent with respects to any such
security or any interest therein; (iv) deposits any such security or any interest
therein into a voting trust, or enters into a voting agreement or arrangement
with respect to any such security or any interest therein; or (v) takes any
other action that would in any way materially restrict, limit or interfere with
the performance of the Stockholder’s obligations hereunder or the transactions
contemplated hereby.

 

(h)           Capitalized terms not otherwise
defined herein shall have the respective meanings ascribed to them in the
Merger Agreement.

 

Section 2.                      Transfer of Subject
Securities.

 

(a)           Transferee
of Subject Securities to be Bound by this Agreement. The Stockholder
agrees that, except as may be provided herein, during the period from the date
of this Agreement through the Expiration Date, the Stockholder shall not cause
or permit any Transfer of any of the Subject Securities to be effected; provided,
that nothing in this Agreement shall prohibit the Stockholder from Transferring
Subject Securities  to Merger Subsidiary
pursuant to Section 3 hereof.  Parent
and Merger Subsidiary acknowledge and agree that the Stockholder has previously
entered into a voting agreement with Wiser Investment Company, LLC (“WIC”)
granting WIC certain voting

 

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rights with respect to the
Subject Securities and that WIC and Stockholder have in connection with a loan
previously pledged Subject Securities to Management Resources Group, LLC
(“MRG”) pursuant to a pledge agreement previously entered into by such parties
and that the existence of such voting and pledge agreements and the continuing
compliance by the parties thereto with such agreements shall not be deemed a
Transfer in contravention of this Section 2(a); provided, however, that
notwithstanding the foregoing no Transfer shall be permitted under such
agreements if such Transfer would adversely affect the right and power of the
Stockholder to tender the Subject Securities in the Offer or otherwise comply
with its obligations under this Agreement unless the transferee in any such
Transfer shall (i) execute a counterpart of this Agreement and (ii) agree to
hold such Subject Securities subject to all of the terms and provisions of this
Agreement and be treated as a Stockholder hereunder.  If Section 3(c) applies, the Stockholder agrees that during the
period from the Expiration Date through the date the provisions of Section 3(c)
terminate pursuant to Section 9(m), the Stockholder shall not cause or permit
any Transfer of any of the Subject Securities to be effected unless the Person
to whom such Subject Securities are Transferred shall have:  (i) executed a counterpart of this
Agreement and (ii) agreed to hold such Subject Securities subject to the terms
and provisions of Section 3(c) hereof and be treated as a Stockholder
thereunder.

 

(b)           No
Transfer of Voting Rights. The Stockholder shall ensure that, except
for voting agreements in favor of WIC existing on the date hereof and except
for the Stockholders Agreement dated May 26, 2000 among the Company, the
Stockholder and certain other stockholders of the Company (the “Stockholders
Agreement”), during the period from the date of this Agreement through the
Expiration Date: (a) none of the Subject Securities Owned by the Stockholder is
deposited into a voting trust; and (b) no proxy is granted, and no voting agreement
or similar agreement is entered into, with respect to any of the Subject
Securities Owned by the Stockholder.

 

Section
3.              Tender of Subject
Securities.

 

The Stockholder agrees:

 

(a)           to tender the Company Common Stock
Owned by the Stockholder into the Offer promptly, and in any event no later
than the tenth Business Day following the commencement of the Offer, or, if any
Stockholder has not received the Offer Documents by such time, within five
Business Days following receipt of such documents but in any event prior to the
date of expiration of such Offer, in each case, free and clear of any liens,
claims, options, rights of first refusal, co-sale rights, charges or other
encumbrances (collectively, “Liens”) other than the Lien of MRG which shall be released
upon payment by Parent or Merger Subsidiary of a portion of the Offer Price to
be identified by Stockholder and confirmed by MRG in Stockholder’s letter of
transmittal accompanying tendered Subject Securities (it being agreed that the
Stockholder will cause such Lien upon payment for the Subject Securities to be
released) and (ii) not to withdraw any Company Common Stock so tendered so long
as there is no decrease in the Offer Price and the Offer Price is payable in
cash.  The Stockholder shall have no
obligations or liabilities to Parent or Merger Subsidiary under this Section
3(a) at any time after the Expiration Date. If the Stockholder acquires
additional Subject Securities after the date hereof, the Stockholder shall
tender (or cause the record holder to tender) such Subject

 

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Securities on or before the
tenth Business Day following the commencement of the Offer, or, if later, on or
before the fifth Business Day after such acquisition but in any event prior to
the date of expiration of such Offer. The Stockholder acknowledges and agrees
that the obligation of Merger Subsidiary to accept for payment and pay for any
Subject Securities in the Offer is subject to the terms and conditions of the
Offer (as described in the Merger Agreement). Parent and Merger Subsidiary
acknowledge that the Stockholder’s obligation to sell any Subject Securities to
Merger Subsidiary and the release of the Lien of MRG and termination of any
voting agreement in favor of WIC is expressly conditioned upon Merger
Subsidiary’s acceptance and payment for the Subject Securities in the Offer
pursuant to the terms of the Offer as the same may be amended from time to
time, consistent with the terms of this Agreement and the Merger Agreement;

 

(b)           to permit Parent, Merger Subsidiary
and the Company to publish and disclose in the Offer Documents and Schedule
14D-9 and, if approval of the stockholders of the Company is required under
applicable law, the Proxy Statement (including all documents and schedules
filed with the SEC) and any similar filing required by applicable law in
connection with the transactions contemplated by the Offer and Merger
Agreement, the Stockholder’s identity and ownership of the Subject Securities
and the nature of the Stockholder’s commitments, arrangements and
understandings under this Agreement;

 

(c)           in the event (i) the Merger Agreement
is terminated pursuant to Sections 8.01(e), 8.01(f) or 8.01(h) of the Merger
Agreement (in the case of 8.01(h), only if the Minimum Condition had not been
satisfied and an Acquisition Proposal existed or had been previously announced
prior to the termination of the Merger Agreement), and (ii) within nine months
following such termination the Stockholder (A) receives consideration in
respect of some or all of the Subject Securities in connection with the
consummation of an Acquisition Proposal or (B) makes a bona fide sale of some
or all of its Subject Securities to a third party, to pay Parent an amount in
immediately available funds by wire transfer to a bank account designated by
Parent equal to 30.78% multiplied by the difference between (i) the aggregate
fair value of the consideration received by the Stockholder pursuant to such
Acquisition Proposal or third party sale, as applicable, and (ii) the aggregate
cash consideration that would have been received by the Stockholder pursuant to
the Offer based on the initial Offer Price of $10.60 per share with respect to
the Subject Securities sold in connection with such Acquisition Proposal or
third party sale, as applicable (or in the case of Subject Securities other
than Company Common Stock, the amount of cash consideration that would have
been received had such Subject Securities been exercised for Company Common
Stock prior to the expiration of the Offer net of the applicable exercise
price).  Such payment to Parent shall be
made as follows: (i) if the consideration paid to the Stockholder is cash,
immediately following the consummation of such Acquisition Proposal or third party
sale or (ii) if the consideration paid to the Stockholder consists of
marketable securities, within ten Business Days following consummation of such
Acquisition Proposal or third party sale. 
In the event the consideration received by the Stockholder in respect of
an Acquisition Proposal or third party sale, as applicable, consists of
marketable securities, the fair value of such securities shall be determined
based on the closing market price of such securities on the principal
securities exchange or other trading market for such securities on the Business

 

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Day immediately preceding the
closing date of such Acquisition Proposal or third party sale.  In the event the consideration received by
the Stockholder in respect of an Acquisition Proposal or third party sale, as
applicable, consists of non-marketable securities or other property, the fair
value of such consideration shall be determined by a nationally recognized
investment banking firm selected by Stockholder that has not provided services
to Stockholder or its affiliates during the prior five years and is reasonably
acceptable to Parent as soon as possible after the closing of such Acquisition
Proposal, and the fair value determination of such firm shall be binding upon
the parties.  In the event the
consideration received by the Stockholder consists of any non-marketable
securities or other property, the Stockholder shall pay Parent its good faith
estimate (the “Estimated Payment”) of the amount owed pursuant to this Section
3(c) in respect of such consideration within ten Business Days following
consummation of the Acquisition Proposal or third party sale, as
applicable.  Following the determination
of the fair value of any non-marketable securities or other property (as
described above), the Stockholder or Parent shall promptly pay the other party
in immediately available funds by wire transfer to a bank account designated by
the payee party an amount equal to the difference between the Estimated Payment
and finally determined amount owing to Parent under Section 3(c) (with Parent
receiving payment to the extent such amount exceeds the Estimated Payment and
the Stockholder receiving payment to the extent the Estimated Payment exceeds
such amount).  In addition, if
Stockholder makes a bona fide sale of some or all of its Subject Securities to
a third party at a time when the Company is then a party to an agreement that
provides for an Acquisition Proposal (which agreement has not then been
terminated pursuant to its terms), then if such Acquisition Proposal is
consummated (or if that Acquisition Proposal is not consummated because another
Acquisition Proposal supplants that Acquisition Proposal because the Company
determines such Acquisition Proposal is superior, then if such subsequent
Acquisition Proposal is consummated) within nine months following the
termination of the Merger Agreement, Stockholder shall pay to Parent within ten
Business Days of the consummation of such Acquisition Proposal the Top-up
Amount.  The Top-up Amount shall be
equal to 30.78% multiplied by the difference between (i) the aggregate fair
value of the consideration that would have been received by the Stockholder
pursuant to such Acquisition Proposal in respect of the Subject Securities that
were sold in such bona fide sale to a third party and (ii) the aggregate fair
value of the consideration received by such Stockholder in connection with such
bona fide sale.  For the avoidance of doubt,
Parent and Merger Subsidiary acknowledge and agree that because of the
undertaking by Stockholder in this Section 3(c) to disgorge a portion of the
improved price of such Acquisition Proposal or Superior Proposal over the Offer
Price (i) on and after the termination of the Merger Agreement (or the
Expiration Date, if earlier) the Stockholder may take any actions necessary to
consummate an Acquisition Proposal or Superior Proposal in lieu of the Offer,
including, without limitation, withdrawing its shares from the Offer and voting
in favor of such other Acquisition Proposal or Superior Proposal and
(ii) prior to the termination of the Merger Agreement (or the Expiration
Date, if earlier) the Stockholder may take any action except those prohibited
by this Agreement, including the prohibitions referred to in Section 5 of this
Agreement, and any of the Stockholder’s designees or affiliates who is a
director or officer of the Company may expressly take such actions as are
contemplated by the last two sentences of section 5 in connection with an Acquisition
Proposal or Superior Proposal; and

 

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(d)           that it will not enter into an
agreement, arrangement or understanding (whether written or oral) with WIC or
Dimeling, Schreiber and Park Reorganization Fund II, L.P. or their direct or
indirect owners (and will not permit its direct or indirect owners to enter
into any such agreements, arrangements or understandings) that affects or
otherwise modifies the sharing agreement contemplated by Section 3(c) hereof or
any other provisions of this Agreement in a manner adverse to Parent or Merger
Subsidiary without the prior written consent of Parent.

 

Section 4.                      Voting of Subject
Securities.

 

Stockholder Agreement.  The
Stockholder agrees that, during the period from the date of this Agreement
until the Expiration Date:

 

(i)                    at any
meeting of stockholders of the Company, however called, and at every
adjournment or postponement thereof, the Stockholder shall (A) appear at the
meeting, or otherwise cause all shares of Company Common Stock Owned by the
Stockholder to be counted as present thereat for purposes of establishing a
quorum, (B) vote or cause all shares of Company Common Stock Owned by the
Stockholder to be voted in favor of the approval and adoption of the Merger
Agreement and the approval of the Merger and (C) vote or cause all shares of
Company Common Stock Owned by the Stockholder to be voted, against (1) any
Acquisition Proposal (other than one by Parent or Merger Subsidiary) and (2)
any amendment of the Company’s Certificate of Incorporation or Bylaws or other
proposal, action or transaction involving the Company or any of its
subsidiaries or any of its stockholders, which amendment or other proposal,
action or transaction could reasonably be expected to prevent or materially
impede or delay the consummation of the Offer, the Merger or the other
transactions contemplated by the Merger Agreement or this Agreement or to
deprive Parent or Merger Subsidiary of any material portion of the benefits
anticipated by Parent or Merger Subsidiary to be received from the consummation
of the Offer, the Merger or the other transactions contemplated by the Merger
Agreement or this Agreement, or change in any manner the voting rights of
Company Common Stock presented to the stockholders of the Company or in respect
of which vote or consent of the stockholders is requested or sought, unless
such transaction has been approved in advance by Parent or Merger Subsidiary;
and

 

(ii)                   in the
event written consents are solicited or otherwise sought from stockholders of
the Company with respect to the approval or adoption of the Merger Agreement or
with respect to the approval of the Merger, the Stockholder shall cause to be
validly executed, with respect to all shares of Company Common Stock Owned by
the Stockholder as of the record date fixed for the consent to the proposed
action, a written consent or written consents to such proposed action.

 

Section 5.                      No Solicitation.

 

During the period from the date of this Stockholder Agreement through
the Expiration Date, the Stockholder shall not, nor shall the Stockholder
authorize or permit any representative

 

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of the Stockholder to, directly or indirectly take any
action prohibited by Section 6.03 of the Merger Agreement.  Nothing contained in this Section 5 shall
prevent any person affiliated with the Stockholder who is a director or officer
of the Company or designated by the Stockholder as a director of officer of the
Company, when acting in his capacity as a director or officer of the Company,
from exercising his fiduciary duties as a director or officer of the Company
including, without limitation, taking any actions permitted under Section 6.03
of the Merger Agreement.  In addition,
nothing in this Agreement shall (or require the Stockholder to attempt to)
limit or restrict any designee or affiliate of the Stockholder who is a
director or officer of the Company from acting in such capacity or voting in
such person’s sole discretion on any matter (it being understood that this
Agreement shall apply to the Stockholder solely in the Stockholder’s capacity
as a stockholder of the Company).  The
Stockholder shall have no liability to Parent, Merger Subsidiary or any of
their respective affiliates under this Agreement as a result of any action or
inaction by any designee or affiliate of Stockholder who is a director or
officer of the Company, in either case serving on the Company’s board of
directors or as an officer of the Company and acting in such person’s capacity
as a director, officer or fiduciary of the Company.

 

Section 6.                      Representations and
Warranties of Stockholders.

 

The Stockholder hereby represents and warrants to Parent and Merger
Subsidiary as follows:

 

(a)           Due Organization; Qualification.  The Stockholder, if a corporation, limited
liability company, limited partnership or other entity, has been duly
incorporated, organized or formed and is validly existing and in good standing
under the laws of the State of its incorporation, formation or
organization.  The Stockholder is duly
licensed or qualified to do business and is in good standing in each
jurisdiction in which the properties owned or leased by it or the operation of
its business makes such licensing or qualification necessary, except where the
failure to so qualify or be licensed would not have a material adverse effect
on the Stockholder.

 

(b)           Power; Due Authorization; Binding
Agreement. The Stockholder has full legal capacity, power and
authority to execute and deliver this Agreement, to perform its obligations
hereunder and to consummate the transactions contemplated hereby. This
Agreement has been duly and validly executed and delivered by the Stockholder
and constitutes a legal, valid and binding agreement of the Stockholder,
enforceable against the Stockholder in accordance with its terms, except as
that enforceability may be subject to the effect of any applicable bankruptcy,
reorganization, insolvency, moratorium or other similar laws affecting or
relating to the enforcement of creditors’ rights generally and to general
principles of equity.  The Stockholder,
if a corporation, limited liability company, limited partnership or other
entity, has on the date hereof provided Parent a legal opinion or other
evidence reasonably satisfactory to Parent that this Agreement has been duly
authorized, executed and delivered by the Stockholder.

 

(c)           No
Conflicts or Consents.

 

(i)                    The
execution and delivery of this Agreement by the Stockholder does not, and the
performance of this Agreement by the Stockholder will not: (A) conflict with or
violate any certificate of incorporation or bylaws or

 

7

 

equivalent organizational documents of the Stockholder, (B) subject to
the consent of the Company (which consent of the Company has been obtained),
conflict with or violate any law, rule, regulation, order, decree or judgment
applicable to the Stockholder or by which the Stockholder or any of the
Stockholder’s properties or assets is or may be bound or affected; or (C)
result in or constitute (with or without notice or lapse of time) any breach of
or default under, or give to any other Person (with or without notice or lapse
of time) any right of termination, amendment, acceleration or cancellation of,
or result (with or without notice or lapse of time) in the creation of any Lien
on any of the Subject Securities pursuant to, any contract to which the
Stockholder is a party or by which the Stockholder or any of the Stockholder’s
affiliates or properties is or may be bound or affected except that the consent
of the Company and WIC (which consents of the Company and WIC have been
obtained), are required for any Transfer, including the execution of this
Agreement.

 

(ii)                   Except for
the consent of the Company and WIC (which consents of the Company and WIC have
been obtained) the execution and delivery of this Agreement by the Stockholder
do not, and the performance of this Agreement by the Stockholder will not,
require any consent or approval of any other Person.

 

(d)           Title
to Securities. As of the date of this Agreement: (a) except for the
Lien in favor of MRG, the voting agreements and proxies in favor or WIC and the
Stockholders Agreement, the Stockholder holds of record free and clear of any
Liens the number of outstanding shares of Company Common Stock set forth under
the heading “Company Common Stock Owned” on Schedule I hereto; and (b)
the Stockholder does not directly or indirectly Own any shares of capital stock
or other securities of the Company, or any option, warrant or other right to
acquire (by purchase, conversion or otherwise) any shares of capital stock or
other securities of the Company.

 

(e)           Absence
of Litigation.  As of the
date hereof, there is no litigation, suit, claim, action, proceeding or
investigation pending, or to the knowledge of the Stockholder, threatened
against the Stockholder, or any property or asset of the Stockholder, before
any Governmental Authority that seeks to delay or prevent the consummation of
the transactions contemplated by this Agreement.

 

(f)            Accuracy
of Representations. The representations and warranties contained in
this Agreement are true and correct as of the date of this Agreement and will
be true and correct in all material respects at all times until the Expiration
Date.

 

Section 7.                      Representations and
Warranties of Parent and the Merger Subsidiary.

 

Each of Parent
and the Merger Subsidiary hereby represents and warrants to the Stockholder as
follows:

 

(a)           Due
Organization, etc. Each of Parent and the
Merger Subsidiary has been duly incorporated and is validly existing and in
good standing under the laws of the

 

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State of its
incorporation. Each of Parent and Merger Subsidiary has all necessary corporate
power and authority to execute and deliver this Agreement and to consummate the
transactions contemplated by this Agreement. The execution and delivery of this
Agreement and the consummation of the transactions contemplated by this
Agreement by Parent and the Merger Subsidiary have been duly authorized by all
necessary action on the part of Parent and the Merger Subsidiary.

 

(b)           No
Conflict.

 

(i)            The execution and delivery of this Agreement
by Parent and Merger Subsidiary does not, and the performance of this Agreement
by Parent and Merger Subsidiary will not: (A) conflict with or violate
any certificate of incorporation or bylaws of Parent or Merger Subsidiary, (B)
conflict with or violate any law, rule, regulation, order, decree or judgment
applicable to Parent or Merger Subsidiary or by which Parent or Merger
Subsidiary or any of their properties or assets are or may be bound or
affected; or (C) result in or constitute (with or without notice or lapse of
time) any breach of or default under, or give to any other Person (with or
without notice or lapse of time) any right of termination, amendment,
acceleration or cancellation of, or result (with or without notice or lapse of
time) in the creation of any Lien on any of the assets of Parent or Merger
Subsidiary pursuant to, any contract to which Parent or Merger Subsidiary is a
party or by which Parent or Merger Subsidiary or any of their affiliates or
properties is or may be bound or affected.

 

(ii)           The execution and delivery of the Merger
Agreement by Parent and Merger Subsidiary do not, and the performance of the
Merger Agreement by Parent and Merger Subsidiary will not: (A) conflict
with or violate any certificate of incorporation or bylaws of Parent or Merger
Subsidiary, (B) conflict with or violate any law, rule, regulation, order,
decree or judgment applicable to Parent or Merger Subsidiary or by which Parent
or Merger Subsidiary or any of their properties or assets are or may be bound
or affected; or (C) result in or constitute (with or without notice or lapse of
time) any breach of or default under, or give to any other Person (with or
without notice or lapse of time) any right of termination, amendment,
acceleration or cancellation of, or result (with or without notice or lapse of
time) in the creation of any Lien on any of the assets of Parent or Merger
Subsidiary pursuant to, any contract to which Parent or Merger Subsidiary is a
party or by which Parent or Merger Subsidiary or any of their affiliates or
properties is or may be bound or affected, except in the case of matters
described in clauses (B) and (C) that, individually or in the aggregate, would
not have a Parent Material Adverse Effect.

 

(iii)        The
execution and delivery of this Agreement by Parent or Merger Subsidiary do not,
and the performance of this Agreement by Parent or Merger Subsidiary will not,
require any consent or approval of any other Person except as specifically set
forth in the Merger Agreement.

 

(iv)        The
execution and delivery of the Merger Agreement by Parent or Merger Subsidiary
do not, and the performance of the Merger Agreement by

 

9

 

Parent or Merger Subsidiary will not, require any consent or approval
of any other Person except as specifically set forth in the Merger Agreement or
except where the failure to obtain such consents or approvals would not,
individually or in the aggregate, have a Parent Material Adverse Effect.

 

(c)           Reliance
by the Stockholder. Each of Parent and Merger Subsidiary understands
and acknowledges that the Stockholder is entering into this Agreement in
reliance upon the execution and delivery of the Merger Agreement by Parent and
Merger Subsidiary.

 

Section 8.                      Further Assurances.

 

From time to time the Stockholder, Parent and Merger Subsidiary shall
execute and deliver, or cause to be executed and delivered, such additional
transfers, assignments, endorsements, proxies, consents and other instruments,
and shall take such further actions, as the other parties hereto may reasonably
request for the purpose of carrying out and furthering the intent of this
Agreement.

 

Section 9.                      Miscellaneous.

 

(a)           Specific
Performance. The Stockholder agrees that in the event of any breach
or threatened breach by the Stockholder of any covenant, obligation or other
provision contained in this Agreement, Parent and Merger Subsidiary shall be
entitled (in addition to any other remedy that may be available to Parent or
Merger Subsidiary) to: (a) a decree or order of specific performance or
mandamus to enforce the observance and performance of such covenant, obligation
or other provision; and (b) an injunction restraining such breach or threatened
breach.

 

(b)           Notices.
Any notice or other communication required or permitted to be delivered to
Parent, Merger Subsidiary or the Stockholder under this Agreement shall be in
writing and shall be deemed properly delivered, given and received when
delivered to the address or facsimile telephone number set forth beneath the
name of such party below (or to such other address or facsimile telephone number
as such party shall have specified in a written notice given to the other
party):

 

If to Parent or Merger
Subsidiary, to:

 

Forest
Oil Corporation

1600
Broadway

Suite
2200

Denver,
Colorado  80202

Attention:   General Counsel

Telephone: (303) 812-1400

Facsimile:  (303) 812-1510

 

If to the Stockholder: to the
address set forth on the signature page hereto.

 

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(c)           Severability.
If any provision of this Agreement or any part of any such provision is held under
any circumstances to be invalid or unenforceable in any jurisdiction, then (a)
such provision or part thereof shall, with respect to such circumstances and in
such jurisdiction, be deemed amended to conform to applicable laws so as to be
valid and enforceable to the fullest possible extent, (b) the invalidity or
unenforceability of such provision or part thereof under such circumstances and
in such jurisdiction shall not affect the validity or enforceability of such
provision or part thereof under any other circumstances or in any other
jurisdiction, and (c) the invalidity or unenforceability of such provision or
part thereof shall not affect the validity or enforceability of the remainder
of such provision or the validity or enforceability of any other provision of
this Agreement.

 

(d)           Governing
Law; Jurisdiction. This Agreement is made under, and shall be
construed and enforced in accordance with, the laws of the State of Delaware
applicable to agreements made and to be performed solely therein, without
giving effect to principles of conflicts of law. In any action between the
parties hereto, whether arising out of this Agreement or otherwise: (a) each of
the parties irrevocably and unconditionally consents and submits to the
jurisdiction and venue of the Chancery or other Courts of the State of
Delaware; (b) if any such action is commenced in a state court, then, subject
to applicable law, no party shall object to the removal of such action to any
federal court located in Delaware; (c) each of the parties irrevocably waives
the right to trial by jury; and (d) each of the parties irrevocably consents to
service of process by first class certified mail, return receipt requested,
postage prepaid, to the address at which such party is to receive notice in accordance
with Section 9(b) hereof.

 

(e)           Waiver.
No failure of any party to this Agreement to exercise any power, right,
privilege or remedy under this Agreement, and no delay on the part of any such
party in exercising any power, right, privilege or remedy under this Agreement,
shall operate as a waiver of such power, right, privilege or remedy; and no
single or partial exercise of any such power, right, privilege or remedy shall
preclude any other or further exercise thereof or of any other power, right, privilege
or remedy. No party to this Agreement shall be deemed to have waived any claim
arising out of this Agreement, or any power, right, privilege or remedy under
this Agreement, unless the waiver of such claim, power, right, privilege or
remedy is expressly set forth in a written instrument duly executed and
delivered by such person; and any such waiver shall not be applicable or have
any effect except in the specific instance in which it is given.

 

(f)            Attorneys’
Fees. If any legal action or other legal proceeding relating to this
Agreement or the enforcement of any provision of this Agreement is brought
against any other party to this Agreement, the prevailing party shall be
entitled to recover reasonable attorneys’ fees, costs and disbursements (in addition
to any other relief to which the prevailing party may be entitled).

 

(g)           Captions.
The captions contained in this Agreement are for convenience of reference only,
shall not be deemed to be a part of this Agreement and shall not be referred to
in connection with the construction or interpretation of this Agreement.

 

11

 

(h)           Entire
Agreement. This Agreement sets forth the entire understanding of
Parent, Merger Subsidiary and the Stockholder relating to the subject matter
hereof and supersedes all other prior agreements and understandings between
Parent, Merger Subsidiary and the Stockholder relating to the subject matter
hereof.

 

(i)            Non-exclusivity.
The rights and remedies of any party to this Agreement are not exclusive of or
limited by any other rights or remedies which such party may have, whether at
law, in equity, by contract or otherwise, all of which shall be cumulative (and
not alternative).

 

(j)            Amendments.
This Agreement may not be amended, modified, altered or supplemented other than
by means of a written instrument duly executed and delivered on behalf of
Parent, Merger Subsidiary and the Stockholder.

 

(k)           Assignment;
Binding Effect. Neither this Agreement nor any of the interests or
obligations hereunder may be assigned or delegated by any party hereto without
the prior written consent of the other parties, and any attempted or purported
assignment or delegation of any of such interests or obligations without such
consent shall be void. Subject to the preceding sentence, this Agreement shall
be binding upon each party’s heirs, estate, executors, personal
representatives, successors and assigns, and shall inure to the benefit of each
party and their successors and assigns. Without limiting any of the
restrictions set forth in Section 2 or elsewhere in this Agreement, this
Agreement shall be binding upon any Person to whom any Subject Securities are
Transferred until such time as is provided in clause (m) below. Nothing in
this Agreement is intended to confer on any Person (other than Parent, Merger
Subsidiary, the Stockholder and their successors and assigns) any rights or
remedies of any nature.

 

(l)            Expenses.
Except as specifically provided elsewhere in this Agreement, all costs and
expenses incurred in connection with the transactions contemplated by this
Agreement shall be paid by the party incurring such costs and expenses.

 

(m)          Termination.
This Agreement shall automatically terminate and be of no further force and
effect on the Expiration Date; provided, however, that the obligations of the
Stockholder in Section 3(c), if applicable, will survive for a period of ten
months following the Expiration Date; provided, however, that the
termination of this Agreement shall not relieve any party from any liability
for any previous breach of this Agreement by such party.

 

(n)           Public
Announcement.  Except as
required by Law, the parties to this Agreement shall consult with the other
parties or with such other parties’ counsel before issuing any press release or
otherwise making any public statements with respect to the transactions
contemplated by the Merger Agreement and this Agreement.

 

(o)           Certain
Events.  In the event of any
stock split, stock dividend, merger, reorganization, recapitalization or other
change in the capital structure of the Company affecting the Company Common
Stock or the acquisition of additional Company Common Stock or other securities
or rights of the Company by the Stockholder, through the exercise of options or
otherwise, the number of Subject Securities shall be adjusted

 

12

 

appropriately, and this
Agreement and the obligations hereunder shall attach to any additional Company
Common Stock or other securities or rights of the Company issued to or acquired
by the Stockholder.

 

(p)           Stockholder
Capacity.  No person
executing this Agreement (including, without limitation, such person’s
representatives, designees or affiliates) who is or becomes during the term
hereof a director or officer of the Company makes any agreement or
understanding herein or is obligated hereunder in his capacity as such director
or officer.  The Stockholder executes
this Agreement solely in its capacity as the Owner of Subject Securities (as
further set forth on Schedule I hereto), and nothing herein shall limit
or affect any actions taken by the Stockholder (including, without limitation,
such person’s representatives, designees or affiliates) in that person’s
capacity as an officer or director of the Company.

 

(q)           Stop
Transfer Order; Legend.  In
furtherance of this Agreement, concurrently herewith, the Stockholder shall,
and hereby does authorize the Company or its counsel to, notify the Company’s
transfer agent that there is a stop transfer order with respect to all of the
Subject Securities (and that this Agreement places limits on the voting and
transfer of such shares); provided that, the stop transfer order
shall not restrict or prohibit any Transfer of the Subject Securities if such
transfer is made pursuant to the Offer or such Transfer is made at any time
following the Expiration Date.

 

(r)            Counterparts.
This Agreement may be executed by the parties in separate counterparts, each of
which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument.

 

(s)           Construction.

 

(i)                    For
purposes of this Agreement, whenever the context requires: the singular number
shall include the plural, and vice versa; the masculine gender shall include
the feminine and neuter genders; the feminine gender shall include the
masculine and neuter genders; and the neuter gender shall include masculine and
feminine genders.

 

(ii)                   The parties
agree that any rule of construction to the effect that ambiguities are to be
resolved against the drafting party shall not be applied in the construction or
interpretation of this Agreement.

 

(iii)                  As used in
this Agreement, the words “include” and “including,” and variations thereof,
shall not be deemed to be terms of limitation, but rather shall be deemed to be
followed by the words “without limitation.”

 

(iv)                  Except as
otherwise indicated, all references in this Agreement to “Sections” and
“Exhibits” are intended to refer to Sections of this Agreement and Exhibits to
this Agreement.

 

(t)            Certain
Agreement. Stockholder agrees that in connection with an Acquisition
Proposal subject to Section 3(c) hereof, Stockholder will not at a time when

 

13

 

the Company is party to an
agreement providing for an Acquisition Proposal or when Stockholder has
knowledge that the Company intends to promptly enter into such an agreement,
agree to accept a lower consideration per share in connection with such
Acquisition Proposal than that paid to other stockholders of the Company if
such agreement would result in Parent receiving less a lesser amount pursuant
to Section 3(c).

 

14

 

IN WITNESS WHEREOF, Parent, Merger Subsidiary and the Stockholder have
caused this Agreement to be executed as of the date first written above.

 

	
  Forest Oil
  Corporation

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
  Name:

  	
  Newton W.
  Wilson III

  	
   

  
	
  Title:

  	
  Senior Vice
  President, General Counsel

  & Secretary

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  TWOCO
  Acquisition Corp.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
  Name:

  	
  Newton W. Wilson
  III

  	
   

  
	
  Title:

  	
  Vice
  President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  STOCKHOLDER:

  	
   

  
	
   

  	
   

  
	
  Wiser
  Investors, L.P.

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  Wiser
  Investment Company, LLC,

  general partner

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  George K.
  Hickox, Jr., Member

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Address:

  	
  1629 Locust
  St.

  Philadelphia, PA  19103

  	
   

  
										

 

15

 

Schedule I

 

	
  Stockholder

  	
   

  	
  Company
  Common

  Stock Owned

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Wiser Investors, L.P.

  	
   

  	
  2,462,842

  	
   

  

 

1Exhibit 10.4

 

STOCKHOLDER AGREEMENT

 

THIS STOCKHOLDER AGREEMENT (the “Agreement”) is
entered into as of May 21, 2004, by and among Forest Oil Corporation, a New York corporation (together with its
successors, “Parent”), TWOCO
Acquisition Corp., a Delaware corporation and a wholly owned subsidiary
of Parent (“Merger Subsidiary”), and the stockholder listed on Schedule I
hereto (the “Stockholder”) of The Wiser
Oil Company, a Delaware corporation (the “Company”).

 

RECITALS

 

Parent, Merger Subsidiary and the Company are entering
into an Agreement and Plan of Merger of even date herewith (the “Merger
Agreement”) which provides, among other things, that Merger Subsidiary will
make a cash tender offer (the “Offer”) for all of the issued and outstanding
shares of Company Common Stock (as defined below) and, following the
consummation of the Offer, will merge with and into the Company (the “Merger”),
in each case upon the terms and subject to the conditions set forth in the
Merger Agreement.

 

The Stockholder is the beneficial owner (as defined in
Rule 13d-3 under the Exchange Act) of such number of securities of the Company
as indicated on the Schedule I to this Agreement; and

 

In order to induce Parent and Merger Subsidiary to
enter into the Merger Agreement, the Stockholder is entering into this
Agreement.

 

NOW, THEREFORE, intending to be legally bound, the
parties hereto agree as follows:

 

Section 1.              Certain Definitions.

 

For purposes of this Agreement:

 

(a)           “Company Common Stock” shall mean the
common stock, par value $0.01 per share, of the Company.

 

(b)           “Company Warrants” shall mean
warrants to purchase 741,716 shares of Company Common Stock at an exercise
price of $4.25 per share.

 

(c)           “Expiration Date” shall mean the
earliest of:

 

(i)            the date upon which
the Merger Agreement is validly terminated pursuant to Section 8.01 thereof;

 

(ii)           the date on which
the Parent or Merger Subsidiary shall have purchased and paid for all of the
Subject Securities;

 

(iii)          the date upon which
the Merger becomes effective;

 

 

(iv)          the date upon which
the Merger Agreement is amended to reduce the Offer Price or in any other
manner adverse in any material respect to the Stockholder; and

 

(v)           the End Date.

 

(d)           The Stockholder shall be deemed to
“Own” or to have acquired “Ownership” of a security if the Stockholder is the
record and/or beneficial owner (as defined in Rule 13d-3 under the Exchange
Act) of such security.

 

(e)           “Person” shall mean any individual,
corporation, limited liability company, partnership, trust or other entity, or
governmental authority.

 

(f)            “Subject Securities” shall mean: (i)
all securities of the Company (including all shares of Company Common Stock and
all options and other rights to acquire shares of Company Common Stock
including Company Warrants) Owned by the Stockholder as of the date of this
Agreement; and (ii) all additional securities of the Company (including all
additional shares of Company Common Stock and all additional options and other
rights to acquire shares of Company Common Stock) of which the Stockholder
acquires Ownership during the period from the date of this Agreement through
the Expiration Date.

 

(g)           A Person shall be deemed to have a
effected a “Transfer” of a security if such Person directly or indirectly: (i)
sells, pledges, encumbers, grants an option with respect to, transfers,
distributes or disposes of such security or any interest in such security; (ii)
enters into an agreement or commitment contemplating the possible sale of,
pledge of, encumbrance of, grant of an option with respect to, transfer of or
disposition of such security or any interest therein; (iii) grants any proxy,
power-of-attorney or other authorization or consent with respects to any such
security or any interest therein; (iv) deposits any such security or any interest
therein into a voting trust, or enters into a voting agreement or arrangement
with respect to any such security or any interest therein; or (v) takes any
other action that would in any way materially restrict, limit or interfere with
the performance of the Stockholder’s obligations hereunder or the transactions
contemplated hereby.

 

(h)           Capitalized terms not otherwise
defined herein shall have the respective meanings ascribed to them in the
Merger Agreement.

 

Section 2.              Transfer of Subject Securities.

 

(a)           Transferee of Subject Securities to be Bound by this
Agreement.  The Stockholder
agrees that, except as may be provided herein, during the period from the date
of this Agreement through the Expiration Date, the Stockholder shall not cause
or permit any Transfer of any of the Subject Securities to be effected; provided,
that nothing in this Agreement shall prohibit the Stockholder from Transferring
Subject Securities to Merger Subsidiary pursuant to Section 3 hereof.   Parent and Merger Subsidiary acknowledge
and agree that the Stockholder has previously entered into a voting agreement
with Wiser Investment Company, LLC (“WIC”) granting WIC certain voting

 

2

 

rights with
respect to the Subject Securities.  If
Section 3(c) applies, the Stockholder agrees that during the period from the
Expiration Date through the date the provisions of Section 3(c) terminate
pursuant to Section 9(m), the Stockholder shall not cause or permit any
Transfer of any of the Subject Securities to be effected unless the Person to
whom such Subject Securities are Transferred shall have:  (i) executed a counterpart of this
Agreement and (ii) agreed to hold such Subject Securities subject to the terms
and provisions of Section 3(c) hereof and be treated as a Stockholder
thereunder.

 

(b)           No Transfer of Voting Rights.  The Stockholder shall ensure that, except
for voting agreements in favor of WIC existing on the date hereof and except
for the Stockholders Agreement dated May 26, 2000 among the Company, the
Stockholder and certain other stockholders of the Company (the “Stockholders
Agreement”), during the period from the date of this Agreement through the
Expiration Date: (a) none of the Subject Securities Owned by the Stockholder is
deposited into a voting trust; and (b) no proxy is granted, and no voting
agreement or similar agreement is entered into, with respect to any of the
Subject Securities Owned by the Stockholder.

 

Section 3.              Tender
of Subject Securities.

 

The
Stockholder agrees:

 

(a)           to tender the Company Common Stock
Owned by the Stockholder into the Offer promptly, and in any event no later
than the tenth Business Day following the commencement of the Offer, or, if any
Stockholder has not received the Offer Documents by such time, within five
Business Days following receipt of such documents but in any event prior to the
date of expiration of such Offer, in each case, free and clear of any liens,
claims, options, rights of first refusal, co-sale rights, charges or other encumbrances
(collectively, “Liens”) and (ii) not to withdraw any Company Common Stock so
tendered so long as there is no decrease in the Offer Price and the Offer Price
is payable in cash.  The Stockholder
shall have no obligations or liabilities to Parent or Merger Subsidiary under
this Section 3(a) at any time after the Expiration Date.  If the Stockholder acquires additional
Subject Securities after the date hereof, the Stockholder shall tender (or
cause the record holder to tender) such Subject Securities on or before the
tenth Business Day following the commencement of the Offer, or, if later, on or
before the fifth Business Day after such acquisition but in any event prior to
the date of expiration of such Offer. 
The Stockholder acknowledges and agrees that the obligation of Merger
Subsidiary to accept for payment and pay for any Subject Securities in the
Offer is subject to the terms and conditions of the Offer (as described in the
Merger Agreement).  Parent and Merger
Subsidiary acknowledge that the Stockholder’s obligation to sell any Subject
Securities to Merger Subsidiary and termination of any voting agreement in
favor of WIC is expressly conditioned upon Merger Subsidiary’s acceptance and
payment for the Subject Securities in the Offer pursuant to the terms of the
Offer as the same may be amended from time to time, consistent with the terms
of this Agreement and the Merger Agreement;

 

(b)           to permit Parent, Merger Subsidiary
and the Company to publish and disclose in the Offer Documents and Schedule 14D-9
and, if approval of the stockholders of the Company is required under
applicable law, the Proxy Statement (including all documents and schedules
filed with the SEC) and any similar filing required by

 

3

 

applicable
law in connection with the transactions contemplated by the Offer and Merger
Agreement, the Stockholder’s identity and ownership of the Subject Securities
and the nature of the Stockholder’s commitments, arrangements and
understandings under this Agreement;

 

(c)           in the event (i) the Merger Agreement
is terminated pursuant to Sections 8.01(e), 8.01(f) or 8.01(h) of the Merger
Agreement (in the case of 8.01(h), only if the Minimum Condition had not been
satisfied and an Acquisition Proposal existed or had been previously announced
prior to the termination of the Merger Agreement), and (ii) within nine months
following such termination the Stockholder (A) receives consideration in
respect of some or all of the Subject Securities in connection with the
consummation of an Acquisition Proposal or (B) makes a bona fide sale of some
or all of its Subject Securities to a third party, to pay Parent an amount in
immediately available funds by wire transfer to a bank account designated by
Parent equal to 100% multiplied by the difference between (i) the aggregate
fair value of the consideration received by the Stockholder pursuant to such
Acquisition Proposal or third party sale, as applicable, and (ii) the aggregate
cash consideration that would have been received by the Stockholder pursuant to
the Offer based on the initial Offer Price of $10.60 per share with respect to
the Subject Securities sold in connection with such Acquisition Proposal or
third party sale, as applicable (or in the case of Subject Securities other
than Company Common Stock, the amount of cash consideration that would have
been received had such Subject Securities been exercised for Company Common
Stock prior to the expiration of the Offer net of the applicable exercise
price).  Such payment to Parent shall be
made as follows: (i) if the consideration paid to the Stockholder is cash,
immediately following the consummation of such Acquisition Proposal or third
party sale or (ii) if the consideration paid to the Stockholder consists
of marketable securities, within ten Business Days following consummation of
such Acquisition Proposal or third party sale. 
In the event the consideration received by the Stockholder in respect of
an Acquisition Proposal or third party sale, as applicable, consists of
marketable securities, the fair value of such securities shall be determined
based on the closing market price of such securities on the principal
securities exchange or other trading market for such securities on the Business
Day immediately preceding the closing date of such Acquisition Proposal or
third party sale.  In the event the
consideration received by the Stockholder in respect of an Acquisition Proposal
or third party sale, as applicable, consists of non-marketable securities or
other property, the fair value of such consideration shall be determined by a
nationally recognized investment banking firm selected by Stockholder that has
not provided services to Stockholder or its affiliates during the prior five
years and is reasonably acceptable to Parent as soon as possible after the
closing of such Acquisition Proposal, and the fair value determination of such
firm shall be binding upon the parties. 
In the event the consideration received by the Stockholder consists of
any non-marketable securities or other property, the Stockholder shall pay
Parent its good faith estimate (the “Estimated Payment”) of the amount owed
pursuant to this Section 3(c) in respect of such consideration within ten
Business Days following consummation of the Acquisition Proposal or third party
sale, as applicable.  Following the
determination of the fair value of any non-marketable securities or other
property (as described above), the Stockholder or Parent shall promptly pay the
other party in immediately available funds by wire transfer to a bank account
designated by the payee party an amount equal to the

 

4

 

difference
between the Estimated Payment and finally determined amount owing to Parent
under Section 3(c) (with Parent receiving payment to the extent such amount
exceeds the Estimated Payment and the Stockholder receiving payment to the
extent the Estimated Payment exceeds such amount).  In addition, if Stockholder makes a bona fide sale of some or all
of its Subject Securities to a third party at a time when the Company is then a
party to an agreement that provides for an Acquisition Proposal (which
agreement has not then been terminated pursuant to its terms), then if such
Acquisition Proposal is consummated (or if that Acquisition Proposal is not
consummated because another Acquisition Proposal supplants that Acquisition
Proposal because the Company determines such Acquisition Proposal is superior,
then if such subsequent Acquisition Proposal is consummated) within nine months
following the termination of the Merger Agreement, Stockholder shall pay to
Parent within ten Business Days of the consummation of such Acquisition
Proposal the Top-up Amount.  The Top-up
Amount shall be equal to 100% multiplied by the difference between (i) the
aggregate fair value of the consideration that would have been received by the
Stockholder pursuant to such Acquisition Proposal in respect of the Subject
Securities that were sold in such bona fide sale to a third party and (ii) the aggregate
fair value of the consideration received by such Stockholder in connection with
such bona fide sale.  For the avoidance
of doubt, Parent and Merger Subsidiary acknowledge and agree that because of
the undertaking by Stockholder in this Section 3(c) to disgorge a portion of
the improved price of such Acquisition Proposal or Superior Proposal over the
Offer Price (i) on and after the termination of the Merger Agreement (or
the Expiration Date, if earlier) the Stockholder may take any actions necessary
to consummate an Acquisition Proposal or Superior Proposal in lieu of the
Offer, including, without limitation, withdrawing its shares from the Offer and
voting in favor of such other Acquisition Proposal or Superior Proposal and
(ii) prior to the termination of the Merger Agreement (or the Expiration
Date, if earlier) the Stockholder may take any action except those prohibited
by this Agreement, including the prohibitions referred to in Section 5 of this
Agreement, and any of the Stockholder’s designees or affiliates who is a
director or officer of the Company may expressly take such actions as are
contemplated by the last two sentences of section 5 in connection with an
Acquisition Proposal or Superior Proposal; and

 

(d)           that it will not enter into an agreement,
arrangement or understanding (whether written or oral) with WIC or Wiser
Investors, L.P. or their direct or indirect owners (and will not permit its
direct or indirect owners to enter into any such agreements, arrangements or
understandings) that affects or otherwise modifies the sharing agreement
contemplated by Section 3(c) hereof or any other provisions of this Agreement
in a manner adverse to Parent or Merger Subsidiary without the prior written
consent of Parent.

 

Section 4.              Voting of Subject Securities.

 

Stockholder Agreement.  The Stockholder agrees that, during the
period from the date of this Agreement until the Expiration Date:

 

(i)            at
any meeting of stockholders of the Company, however called, and at every
adjournment or postponement thereof, the Stockholder shall (A) appear at the
meeting, or otherwise cause all shares of Company Common

 

5

 

Stock Owned by the Stockholder to be counted as present thereat for
purposes of establishing a quorum, (B) vote or cause all shares of Company
Common Stock Owned by the Stockholder to be voted in favor of the approval and
adoption of the Merger Agreement and the approval of the Merger and (C) vote or
cause all shares of Company Common Stock Owned by the Stockholder to be voted,
against (1) any Acquisition Proposal (other than one by Parent or Merger
Subsidiary) and (2) any amendment of the Company’s Certificate of Incorporation
or Bylaws or other proposal, action or transaction involving the Company or any
of its subsidiaries or any of its stockholders, which amendment or other
proposal, action or transaction could reasonably be expected to prevent or
materially impede or delay the consummation of the Offer, the Merger or the
other transactions contemplated by the Merger Agreement or this Agreement or to
deprive Parent or Merger Subsidiary of any material portion of the benefits
anticipated by Parent or Merger Subsidiary to be received from the consummation
of the Offer, the Merger or the other transactions contemplated by the Merger
Agreement or this Agreement, or change in any manner the voting rights of
Company Common Stock presented to the stockholders of the Company or in respect
of which vote or consent of the stockholders is requested or sought, unless such
transaction has been approved in advance by Parent or Merger Subsidiary; and

 

(ii)           in
the event written consents are solicited or otherwise sought from stockholders
of the Company with respect to the approval or adoption of the Merger Agreement
or with respect to the approval of the Merger, the Stockholder shall cause to
be validly executed, with respect to all shares of Company Common Stock Owned
by the Stockholder as of the record date fixed for the consent to the proposed
action, a written consent or written consents to such proposed action.

 

Section 5.              No Solicitation.

 

During the period from the date of this Stockholder
Agreement through the Expiration Date, the Stockholder shall not, nor shall the
Stockholder authorize or permit any representative of the Stockholder to,
directly or indirectly take any action prohibited by Section 6.03 of the
Merger Agreement.  Nothing contained in
this Section 5 shall prevent any person affiliated with the Stockholder who is
a director or officer of the Company or designated by the Stockholder as a
director of officer of the Company, when acting in his capacity as a director
or officer of the Company, from exercising his fiduciary duties as a director
or officer of the Company including, without limitation, taking any actions
permitted under Section 6.03 of the Merger Agreement.  In addition, nothing in this Agreement shall (or require the
Stockholder to attempt to) limit or restrict any designee or affiliate of the
Stockholder who is a director or officer of the Company from acting in such
capacity or voting in such person’s sole discretion on any matter (it being
understood that this Agreement shall apply to the Stockholder solely in the
Stockholder’s capacity as a stockholder of the Company).  The Stockholder shall have no liability to
Parent, Merger Subsidiary or any of their respective affiliates under this
Agreement as a result of any action or inaction by any designee or affiliate of
Stockholder who is a director or officer of the Company, in either case serving
on the Company’s board of directors or as an officer of the Company and acting
in such person’s capacity as a director, officer or fiduciary of the Company.

 

6

 

Section 6.              Representations and Warranties of Stockholders.

 

The Stockholder hereby represents and warrants to Parent and Merger
Subsidiary as follows:

 

(a)           Due Organization; Qualification.  The Stockholder, if a corporation, limited
liability company, limited partnership or other entity, has been duly
incorporated, organized or formed and is validly existing and in good standing
under the laws of the State of its incorporation, formation or
organization.  The Stockholder is duly
licensed or qualified to do business and is in good standing in each jurisdiction
in which the properties owned or leased by it or the operation of its business
makes such licensing or qualification necessary, except where the failure to so
qualify or be licensed would not have a material adverse effect on the
Stockholder.

 

(b)           Power; Due Authorization; Binding Agreement.  The Stockholder has full legal capacity,
power and authority to execute and deliver this Agreement, to perform its
obligations hereunder and to consummate the transactions contemplated hereby.  This Agreement has been duly and validly
executed and delivered by the Stockholder and constitutes a legal, valid and
binding agreement of the Stockholder, enforceable against the Stockholder in
accordance with its terms, except as that enforceability may be subject to the
effect of any applicable bankruptcy, reorganization, insolvency, moratorium or
other similar laws affecting or relating to the enforcement of creditors’
rights generally and to general principles of equity.  The Stockholder, if a corporation, limited liability company,
limited partnership or other entity, has on the date hereof provided Parent a
legal opinion or other evidence reasonably satisfactory to Parent that this
Agreement has been duly authorized, executed and delivered by the Stockholder.

 

(c)           No
Conflicts or Consents.

 

(i)            The execution and
delivery of this Agreement by the Stockholder does not, and the performance of
this Agreement by the Stockholder will not: (A) conflict with or violate any
certificate of incorporation or bylaws or equivalent organizational documents
of the Stockholder, (B) subject to the consent of the Company (which consent of
the Company has been obtained), conflict with or violate any law, rule,
regulation, order, decree or judgment applicable to the Stockholder or by which
the Stockholder or any of the Stockholder’s properties or assets is or may be
bound or affected; or (C) result in or constitute (with or without notice or
lapse of time) any breach of or default under, or give to any other Person
(with or without notice or lapse of time) any right of termination, amendment,
acceleration or cancellation of, or result (with or without notice or lapse of
time) in the creation of any Lien on any of the Subject Securities pursuant to,
any contract to which the Stockholder is a party or by which the Stockholder or
any of the Stockholder’s affiliates or properties is or may be bound or
affected except that the consent of the Company and WIC (which consents of the
Company and WIC have been obtained), are required for any Transfer, including
the execution of this Agreement.

 

7

 

(ii)           Except for the
consent of the Company and WIC (which consents of the Company and WIC have been
obtained) the execution and delivery of this Agreement by the Stockholder do
not, and the performance of this Agreement by the Stockholder will not, require
any consent or approval of any other Person.

 

(d)           Title to Securities.  As of the date of this Agreement: (a) except
for the voting agreements and proxies in favor or WIC and the Stockholders
Agreement, the Stockholder holds of record free and clear of any Liens the
number of outstanding shares of Company Common Stock set forth under the
heading “Company Common Stock Owned” on Schedule I hereto; and (b) the
Stockholder does not directly or indirectly Own any shares of capital stock or
other securities of the Company, or any option, warrant or other right to
acquire (by purchase, conversion or otherwise) any shares of capital stock or
other securities of the Company.

 

(e)           Absence of Litigation.  As of the date hereof, there is no
litigation, suit, claim, action, proceeding or investigation pending, or to the
knowledge of the Stockholder, threatened against the Stockholder, or any
property or asset of the Stockholder, before any Governmental Authority that
seeks to delay or prevent the consummation of the transactions contemplated by
this Agreement.

 

(f)            Accuracy of Representations.  The representations and warranties contained
in this Agreement are true and correct as of the date of this Agreement and
will be true and correct in all material respects at all times until the
Expiration Date.

 

Section 7.              Representations and Warranties of
Parent and the Merger Subsidiary.

 

Each of Parent and the Merger Subsidiary hereby represents and warrants
to the Stockholder as follows:

 

(a)           Due
Organization, etc.  Each of Parent and the Merger Subsidiary has been duly
incorporated and is validly existing and in good standing under the laws of the
State of its incorporation.  Each of
Parent and Merger Subsidiary has all necessary corporate power and authority to
execute and deliver this Agreement and to consummate the transactions
contemplated by this Agreement.  The
execution and delivery of this Agreement and the consummation of the
transactions contemplated by this Agreement by Parent and the Merger Subsidiary
have been duly authorized by all necessary action on the part of Parent and the
Merger Subsidiary.

 

(b)           No
Conflict.

 

(i)            The execution and delivery of this Agreement
by Parent and Merger Subsidiary does not, and the performance of this Agreement
by Parent and Merger Subsidiary will not: (A) conflict with or violate
any certificate of incorporation or bylaws of Parent or Merger Subsidiary, (B)
conflict with or violate any law, rule, regulation, order, decree or judgment
applicable to Parent or Merger Subsidiary or by which Parent or Merger
Subsidiary or any of their

 

8

 

properties or assets are or may be bound or affected; or (C) result in
or constitute (with or without notice or lapse of time) any breach of or
default under, or give to any other Person (with or without notice or lapse of
time) any right of termination, amendment, acceleration or cancellation of, or
result (with or without notice or lapse of time) in the creation of any Lien on
any of the assets of Parent or Merger Subsidiary pursuant to, any contract to
which Parent or Merger Subsidiary is a party or by which Parent or Merger
Subsidiary or any of their affiliates or properties is or may be bound or
affected.

 

(ii)            The execution and delivery of the Merger
Agreement by Parent and Merger Subsidiary do not, and the performance of the
Merger Agreement by Parent and Merger Subsidiary will not: (A) conflict
with or violate any certificate of incorporation or bylaws of Parent or Merger
Subsidiary, (B) conflict with or violate any law, rule, regulation, order,
decree or judgment applicable to Parent or Merger Subsidiary or by which Parent
or Merger Subsidiary or any of their properties or assets are or may be bound
or affected; or (C) result in or constitute (with or without notice or lapse of
time) any breach of or default under, or give to any other Person (with or
without notice or lapse of time) any right of termination, amendment,
acceleration or cancellation of, or result (with or without notice or lapse of
time) in the creation of any Lien on any of the assets of Parent or Merger
Subsidiary pursuant to, any contract to which Parent or Merger Subsidiary is a
party or by which Parent or Merger Subsidiary or any of their affiliates or
properties is or may be bound or affected, except in the case of matters
described in clauses (B) and (C) that, individually or in the aggregate, would
not have a Parent Material Adverse Effect.

 

(iii)          The execution and
delivery of this Agreement by Parent or Merger Subsidiary do not, and the
performance of this Agreement by Parent or Merger Subsidiary will not, require
any consent or approval of any other Person except as specifically set forth in
the Merger Agreement.

 

(iv)          The execution and
delivery of the Merger Agreement by Parent or Merger Subsidiary do not, and the
performance of the Merger Agreement by Parent or Merger Subsidiary will not,
require any consent or approval of any other Person except as specifically set
forth in the Merger Agreement or except where the failure to obtain such
consents or approvals would not, individually or in the aggregate, have a
Parent Material Adverse Effect.

 

(c)           Reliance
by the Stockholder.  Each of
Parent and Merger Subsidiary understands and acknowledges that the Stockholder
is entering into this Agreement in reliance upon the execution and delivery of
the Merger Agreement by Parent and Merger Subsidiary.

 

Section 8.              Further Assurances.

 

From time to time the Stockholder, Parent and Merger
Subsidiary shall execute and deliver, or cause to be executed and delivered,
such additional transfers, assignments, endorsements, proxies, consents and
other instruments, and shall take such further actions, as the

 

9

 

other parties hereto may reasonably request for the
purpose of carrying out and furthering the intent of this Agreement.

 

Section 9.              Miscellaneous.

 

(a)           Specific Performance.  The Stockholder agrees that in the event of
any breach or threatened breach by the Stockholder of any covenant, obligation
or other provision contained in this Agreement, Parent and Merger Subsidiary
shall be entitled (in addition to any other remedy that may be available to
Parent or Merger Subsidiary) to: (a) a decree or order of specific performance
or mandamus to enforce the observance and performance of such covenant,
obligation or other provision; and (b) an injunction restraining such breach or
threatened breach.

 

(b)           Notices.  Any notice or other communication required or permitted to be
delivered to Parent, Merger Subsidiary or the Stockholder under this Agreement
shall be in writing and shall be deemed properly delivered, given and received
when delivered to the address or facsimile telephone number set forth beneath
the name of such party below (or to such other address or facsimile telephone
number as such party shall have specified in a written notice given to the
other party):

 

If to Parent or Merger Subsidiary, to:

 

Forest Oil Corporation

1600 Broadway

Suite 2200

Denver, Colorado  80202

Attention:   General Counsel

Telephone:
(303) 812-1400

Facsimile:  (303) 812-1510

 

If to the Stockholder: to the address set forth on the signature page
hereto.

 

(c)           Severability.  If any provision of this Agreement or any part of any such
provision is held under any circumstances to be invalid or unenforceable in any
jurisdiction, then (a) such provision or part thereof shall, with respect to
such circumstances and in such jurisdiction, be deemed amended to conform to
applicable laws so as to be valid and enforceable to the fullest possible
extent, (b) the invalidity or unenforceability of such provision or part
thereof under such circumstances and in such jurisdiction shall not affect the
validity or enforceability of such provision or part thereof under any other
circumstances or in any other jurisdiction, and (c) the invalidity or
unenforceability of such provision or part thereof shall not affect the
validity or enforceability of the remainder of such provision or the validity
or enforceability of any other provision of this Agreement.

 

(d)           Governing Law; Jurisdiction.  This Agreement is made under, and shall be
construed and enforced in accordance with, the laws of the State of Delaware applicable
to agreements made and to be performed solely therein, without giving effect to
principles of conflicts of law.  In any
action between the parties hereto, whether arising

 

10

 

out of this
Agreement or otherwise: (a) each of the parties irrevocably and unconditionally
consents and submits to the jurisdiction and venue of the Chancery or other
Courts of the State of Delaware; (b) if any such action is commenced in a state
court, then, subject to applicable law, no party shall object to the removal of
such action to any federal court located in Delaware; (c) each of the parties
irrevocably waives the right to trial by jury; and (d) each of the parties
irrevocably consents to service of process by first class certified mail,
return receipt requested, postage prepaid, to the address at which such party
is to receive notice in accordance with Section 9(b) hereof.

 

(e)           Waiver. 
No failure of any party to this Agreement to exercise any power, right,
privilege or remedy under this Agreement, and no delay on the part of any such
party in exercising any power, right, privilege or remedy under this Agreement,
shall operate as a waiver of such power, right, privilege or remedy; and no
single or partial exercise of any such power, right, privilege or remedy shall
preclude any other or further exercise thereof or of any other power, right,
privilege or remedy.  No party to this
Agreement shall be deemed to have waived any claim arising out of this
Agreement, or any power, right, privilege or remedy under this Agreement,
unless the waiver of such claim, power, right, privilege or remedy is expressly
set forth in a written instrument duly executed and delivered by such person;
and any such waiver shall not be applicable or have any effect except in the
specific instance in which it is given.

 

(f)            Attorneys’ Fees.  If any legal action or other legal proceeding relating to this
Agreement or the enforcement of any provision of this Agreement is brought
against any other party to this Agreement, the prevailing party shall be
entitled to recover reasonable attorneys’ fees, costs and disbursements (in
addition to any other relief to which the prevailing party may be entitled).

 

(g)           Captions. 
The captions contained in this Agreement are for convenience of
reference only, shall not be deemed to be a part of this Agreement and shall
not be referred to in connection with the construction or interpretation of
this Agreement.

 

(h)           Entire Agreement.  This Agreement sets forth the entire
understanding of Parent, Merger Subsidiary and the Stockholder relating to the
subject matter hereof and supersedes all other prior agreements and
understandings between Parent, Merger Subsidiary and the Stockholder relating
to the subject matter hereof.

 

(i)            Non-exclusivity.  The rights and remedies of any party to this Agreement are not
exclusive of or limited by any other rights or remedies which such party may
have, whether at law, in equity, by contract or otherwise, all of which shall
be cumulative (and not alternative).

 

(j)            Amendments.  This Agreement may not be amended, modified, altered or
supplemented other than by means of a written instrument duly executed and
delivered on behalf of Parent, Merger Subsidiary and the Stockholder.

 

(k)           Assignment; Binding Effect.  Neither this Agreement nor any of the
interests or obligations hereunder may be assigned or delegated by any party
hereto without the prior written consent of the other parties, and any
attempted or purported

 

11

 

assignment or
delegation of any of such interests or obligations without such consent shall
be void.  Subject to the preceding
sentence, this Agreement shall be binding upon each party’s heirs, estate,
executors, personal representatives, successors and assigns, and shall inure to
the benefit of each party and their successors and assigns.  Without limiting any of the restrictions set
forth in Section 2 or elsewhere in this Agreement, this Agreement shall be
binding upon any Person to whom any Subject Securities are Transferred until
such time as is provided in clause (m) below.  Nothing in this Agreement is intended to confer on any Person
(other than Parent, Merger Subsidiary, the Stockholder and their successors and
assigns) any rights or remedies of any nature.

 

(l)            Expenses. 
Except as specifically provided elsewhere in this Agreement, all costs
and expenses incurred in connection with the transactions contemplated by this
Agreement shall be paid by the party incurring such costs and expenses.

 

(m)          Termination.  This Agreement shall automatically terminate and be of no further
force and effect on the Expiration Date; provided, however, that the
obligations of the Stockholder in Section 3(c), if applicable, will survive for
a period of ten months following the Expiration Date; provided, however,
that the termination of this Agreement shall not relieve any party from any
liability for any previous breach of this Agreement by such party.

 

(n)           Public Announcement.  Except as required by Law, the parties to
this Agreement shall consult with the other parties or with such other parties’
counsel before issuing any press release or otherwise making any public
statements with respect to the transactions contemplated by the Merger Agreement
and this Agreement.

 

(o)           Certain Events.  In the event of any stock split, stock dividend, merger,
reorganization, recapitalization or other change in the capital structure of
the Company affecting the Company Common Stock or the acquisition of additional
Company Common Stock or other securities or rights of the Company by the
Stockholder, through the exercise of options or otherwise, the number of
Subject Securities shall be adjusted appropriately, and this Agreement and the
obligations hereunder shall attach to any additional Company Common Stock or
other securities or rights of the Company issued to or acquired by the
Stockholder.

 

(p)           Stockholder Capacity.  No person executing this Agreement
(including, without limitation, such person’s representatives, designees or
affiliates) who is or becomes during the term hereof a director or officer of
the Company makes any agreement or understanding herein or is obligated
hereunder in his capacity as such director or officer.  The Stockholder executes this Agreement
solely in its capacity as the Owner of Subject Securities (as further set forth
on Schedule I hereto), and nothing herein shall limit or affect any
actions taken by the Stockholder (including, without limitation, such person’s
representatives, designees or affiliates) in that person’s capacity as an
officer or director of the Company.

 

(q)           Stop Transfer Order; Legend.  In furtherance of this Agreement,
concurrently herewith, the Stockholder shall, and hereby does authorize the
Company or its counsel to, notify the Company’s transfer agent that there is a
stop transfer order with

 

12

 

respect to all
of the Subject Securities (and that this Agreement places limits on the voting
and transfer of such shares); provided that, the stop transfer order
shall not restrict or prohibit any Transfer of the Subject Securities if such
transfer is made pursuant to the Offer or such Transfer is made at any time
following the Expiration Date.

 

(r)            Counterparts.  This Agreement may be executed by the parties in separate
counterparts, each of which when so executed and delivered shall be an
original, but all of which shall together constitute one and the same
instrument.

 

(s)           Construction.

 

(i)            For purposes of
this Agreement, whenever the context requires: the singular number shall
include the plural, and vice versa; the masculine gender shall include the
feminine and neuter genders; the feminine gender shall include the masculine
and neuter genders; and the neuter gender shall include masculine and feminine
genders.

 

(ii)           The parties agree
that any rule of construction to the effect that ambiguities are to be resolved
against the drafting party shall not be applied in the construction or
interpretation of this Agreement.

 

(iii)          As used in this
Agreement, the words “include” and “including,” and variations thereof, shall
not be deemed to be terms of limitation, but rather shall be deemed to be
followed by the words “without limitation.”

 

(iv)          Except as otherwise
indicated, all references in this Agreement to “Sections” and “Exhibits” are
intended to refer to Sections of this Agreement and Exhibits to this Agreement.

 

(t)            Certain Agreement.  Stockholder agrees that in connection with
an Acquisition Proposal subject to Section 3(c) hereof, Stockholder will not at
a time when the Company is party to an agreement providing for an Acquisition
Proposal or when Stockholder has knowledge that the Company intends to promptly
enter into such an agreement, agree to accept a lower consideration per share
in connection with such Acquisition Proposal than that paid to other
stockholders of the Company if such agreement would result in Parent receiving
less a lesser amount pursuant to Section 3(c).

 

13

 

IN WITNESS WHEREOF, Parent, Merger Subsidiary and the
Stockholder have caused this Agreement to be executed as of the date first
written above.

 

Forest Oil Corporation

 

 

	
  By:

  	
   

  	
   

  
	
  Name:

  	
  Newton W. Wilson III

  	
   

  
	
  Title:

  	
  Senior Vice President, General Counsel

  	
   

  
	
   

  	
  & Secretary

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  TWOCO Acquisition Corp.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By: 

  	
   

  	
   

  
	
  Name:

  	
  Newton W. Wilson III

  	
   

  
	
  Title:

  	
  Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  STOCKHOLDER:

  	
   

  
	
   

  	
   

  
	
  Dimeling, Schreiber and

  	
   

  
	
  Park Reorganization Fund II, L.P.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  DSP Investors, L.L.C.

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Richard R. Schreiber, Member

  
	
   

  
	
   

  	
   

  
	
  Address:

  	
  1629 Locust St.

  
	
   

  	
  Philadelphia, PA  19103

  
									

 

14

 

Schedule I

 

	
  Stockholder

  	
   

  	
  Company
  Common

  Stock Owned

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Dimeling, Schreiber and Park Reorganization
  Fund II, L.P.

  	
   

  	
  3,014,642

  	
   

  

 

1

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