Document:

<PAGE>
                                                                     Exhibit 4.4

No. 1                                                      CUSIP No. 29255W AB 6
                                                           ISIN No. US29255WAB63
                                                                    $150,000,000

                    8 3/8% Senior Subordinated Note Due 2012

         Encore Acquisition Company, a Delaware corporation, promises to pay to
Cede & Co., or registered assigns, the principal sum of One Hundred Fifty
Million Dollars on June 15, 2012.

         Interest Payment Dates:    June 15 and December 15.

         Record Dates:              June 1 and December 1.

         Additional provisions of this Security are set forth on the other side
of this Security.

<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be duly executed.

Dated: January 16, 2003

                                     ENCORE ACQUISITION COMPANY

                                     By:
                                        ------------------------
                                     Name:
                                     Title:

TRUSTEE'S CERTIFICATE OF
AUTHENTICATION

WELLS FARGO BANK, N.A.,
  as Trustee, certifies
  that this is one of
  the Securities referred
  to in the Indenture.

 By:
    --------------------------
       Authorized Signatory

                                       2
<PAGE>

                    8 3/8% Senior Subordinated Note Due 2012

1.   Interest

                  Encore Acquisition Company, a Delaware corporation (such
corporation, and its successors and assigns under the Indenture hereinafter
referred to, being herein called the "Company"), promises to pay interest on the
principal amount of this Security at the rate per annum shown above. The Company
will pay interest semiannually on June 15 and December 15 of each year,
commencing June 15, 2003. Interest on the Securities will accrue from the most
recent date to which interest has been paid or, if no interest has been paid,
from December 15, 2002. Interest will be computed on the basis of a 360-day year
of twelve 30-day months.

2.   Method of Payment

                  The Company will pay interest on the Securities (except
defaulted interest) to the Persons who are registered holders of Securities at
the close of business on the June 1 or December 1 next preceding the interest
payment date even if Securities are canceled after the record date and on or
before the interest payment date. Holders must surrender Securities to a Paying
Agent to collect principal payments. The Company will pay principal and interest
in money of the United States that at the time of payment is legal tender for
payment of public and private debts. Payments in respect of the Securities
represented by a Global Security (including principal, premium and interest)
will be made by wire transfer of immediately available funds to the accounts
specified by The Depository Trust Company. The Company will make all payments in
respect of a certificated Security (including principal, premium and interest)
by mailing a check to the registered address of each Holder thereof; provided,
however, that payments on a certificated Security will be made by wire transfer
to a U.S. dollar account maintained by the payee with a bank in the United
States if such Holder elects payment by wire transfer by giving written notice
to the Trustee or the Paying Agent to such effect designating such account no
later than 30 days immediately preceding the relevant due date for payment (or
such other date as the Trustee may accept in its discretion).

3.   Paying Agent and Registrar

                  Initially, Wells Fargo Bank, National Association, a United
States banking association (the "Trustee"), will act as Paying Agent and
Registrar. The Company may appoint and change any Paying Agent, Registrar or
co-registrar without notice. The Company or any of its domestically incorporated
Wholly Owned Subsidiaries may act as Paying Agent, Registrar or co-registrar.

4.   Indenture

                  The Company issued the Securities under an Indenture dated as
of June 25, 2002 ("Indenture"), among the Company, the Subsidiary Guarantors and
the Trustee. The terms of the Securities include those stated in the Indenture
and those made part of the Indenture by reference to the Trust Indenture Act of
1939 (15 U.S.C. Sections 77aaa-77bbbb) as in effect on the date of the Indenture
(the "Act"). Terms defined in the Indenture and not defined herein have the
meanings

                                       3
<PAGE>

ascribed thereto in the Indenture. The Securities are subject to all
such terms, and Securityholders are referred to the Indenture and the Act for a
statement of those terms.

                  The Securities are general unsecured obligations of the
Company. The Company shall be entitled, subject to its compliance with Section
4.03 of the Indenture, to issue Additional Securities pursuant to Section 2.13
of the Indenture. The Initial Securities issued on the Issue Date, any
Additional Securities and all Exchange Securities or Private Exchange Securities
issued in exchange therefor will be treated as a single class for all purposes
under the Indenture. The Indenture contains covenants that limit the ability of
the Company and its subsidiaries to incur additional indebtedness; pay dividends
or distributions on, or redeem or repurchase capital stock; make investments;
issue or sell capital stock of subsidiaries; engage in transactions with
affiliates; create liens on assets; transfer or sell assets; guarantee
indebtedness; restrict dividends or other payments of subsidiaries; and
consolidate, merge or transfer all or substantially all of its assets and the
assets of its subsidiaries. During any period that the Securities have an
Investment Grade Rating from both S&P and Moody's and no Default has occurred
and is continuing, certain covenants will be suspended. These covenants are
subject to important exceptions and qualifications.

5.   Optional Redemption

                  Except as set forth below, the Company shall not be entitled
to redeem the Securities at its option prior to June 15, 2007.

                  On and after June 15, 2007, the Company shall be entitled at
its option to redeem all or a portion of the Securities upon not less than 30
nor more than 60 days' notice, at the redemption prices (expressed in
percentages of principal amount on the redemption date), plus accrued interest
to the redemption date (subject to the right of Holders of record on the
relevant record date to receive interest due on the relevant interest payment
date), if redeemed during the 12-month period commencing on June 15 of the years
set forth below:

<Table>
<Caption>
                               Redemption
Period                            Price
------                         ----------

<S>                            <C>
2007                            104.188%
2008                            102.792%
2009                            101.396%
2010 and thereafter             100.000%
</Table>

                  In addition, prior to June 15, 2005, the Company shall be
entitled at its option on one or more occasions to redeem Securities (which
includes Additional Securities, if any) in an aggregate principal amount not to
exceed 35% of the aggregate principal amount of the Securities (which includes
Additional Securities, if any) issued prior to the redemption date at a
redemption price (expressed as a percentage of principal amount) of 108.375%,
plus accrued and unpaid interest to the redemption date, with the net cash
proceeds from one or more Public Equity Offerings; provided, however, that (1)
at least 65% of such aggregate principal amount of Securities (which includes
Additional Securities, if any) remains outstanding immediately after

                                       4
<PAGE>

the occurrence of each such redemption (other than Securities held, directly or
indirectly, by the Company or its Affiliates); and (2) each such redemption
occurs within 60 days after the date of the related Public Equity Offering.

                  Prior to June 15, 2007, the Company may at its option redeem
all (but not less than all) of the Securities (which includes the Additional
Securities, if any) at a redemption price equal to the sum of:

                  (1)      the principal amount thereof, plus

                  (2)      accrued and unpaid interest, if any, to the
                           redemption date, plus

                  (3)      the Applicable Premium at the redemption date.

6.   Notice of Redemption

                  Notice of redemption will be mailed at least 30 days but not
more than 60 days before the redemption date to each Holder of Securities to be
redeemed at its registered address. Securities in denominations larger than
$1,000 principal amount may be redeemed in part but only in whole multiples of
$1,000. If money sufficient to pay the redemption price of and accrued interest
on all Securities (or portions thereof) to be redeemed on the redemption date is
deposited with the Paying Agent on or before the redemption date and certain
other conditions are satisfied, on and after such date interest ceases to accrue
on such Securities (or such portions thereof) called for redemption.

7.   Put Provisions

                  Upon a Change of Control, then unless the Company shall have
exercised its right to redeem all the Securities, any Holder of Securities will
have the right to cause the Company to repurchase all or any part of the
Securities of such Holder at a repurchase price equal to 101% of the principal
amount of the Securities to be repurchased plus accrued and unpaid interest, if
any, to the date of repurchase (subject to the right of holders of record on the
relevant record date to receive interest due on the related interest payment
date) as provided in, and subject to the terms of, the Indenture.

8.   Subordination

                  The Securities are subordinated to Senior Indebtedness of the
Company, as defined in the Indenture. To the extent provided in the Indenture,
Senior Indebtedness of the Company must be paid before the Securities may be
paid. The Company agrees, and each Securityholder by accepting a Security
agrees, to the subordination provisions contained in the Indenture and
authorizes the Trustee to give it effect and appoints the Trustee as
attorney-in-fact for such purpose.

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<PAGE>

9.   Guaranty

                  The payment by the Company of the principal of, and premium
and interest on, the Securities is fully and unconditionally guaranteed on a
joint and several senior subordinated basis by each of the Subsidiary
Guarantors.

10.  Denominations; Transfer; Exchange

                  The Securities are in registered form without coupons in
denominations of $1,000 principal amount and whole multiples of $1,000. A Holder
may transfer Securities in accordance with the Indenture. The Registrar may
require a Holder, among other things, to furnish appropriate endorsements or
transfer documents and to pay any taxes and fees required by law or permitted by
the Indenture. The Registrar need not register the transfer of any Securities
selected for redemption (except, in the case of a Security to be redeemed in
part, the portion of the Security not to be redeemed) or any Securities for a
period of 15 days before a selection of Securities to be redeemed or 15 days
before an interest payment date.

11.  Persons Deemed Owners

                  The registered Holder of this Security may be treated as the
owner of it for all purposes.

12.  Unclaimed Money

                  If money for the payment of principal or interest remains
unclaimed for two years, the Trustee or Paying Agent shall pay the money back to
the Company at its request unless an abandoned property law designates another
Person. After any such payment, Holders entitled to the money must look only to
the Company and not to the Trustee for payment.

13.  Discharge and Defeasance

                  Subject to certain conditions, the Company at any time shall
be entitled to terminate some or all of its obligations under the Securities and
the Indenture if the Company deposits with the Trustee money or U.S. Government
Obligations for the payment of principal and interest on the Securities to
redemption or maturity, as the case may be.

14.  Amendment, Waiver

                  Subject to certain exceptions set forth in the Indenture, (i)
the Indenture and the Securities may be amended with the written consent of the
Holders of at least a majority in principal amount outstanding of the Securities
and (ii) any default or noncompliance with any provision may be waived with the
written consent of the Holders of a majority in principal amount outstanding of
the Securities. Subject to certain exceptions set forth in the Indenture,
without the consent of any Securityholder, the Company, the Subsidiary
Guarantors and the Trustee shall be entitled to amend the Indenture or the
Securities to cure any ambiguity, omission, defect or inconsistency, or to
comply with Article 5 of the Indenture, or to provide for

                                       6
<PAGE>

uncertificated Securities in addition to or in place of certificated Securities,
or to add guarantees with respect to the Securities, including Subsidiary
Guaranties, or to secure the Securities, or to add additional covenants or
surrender rights and powers conferred on the Company or the Subsidiary
Guarantors, or to comply with any request of the SEC in connection with
qualifying the Indenture under the Act, or to make any change that does not
adversely affect the rights of any Securityholder.

15.  Defaults and Remedies

                  Under the Indenture, Events of Default include (i) default for
30 days in payment of interest on the Securities; (ii) default in payment of
principal on the Securities at maturity, upon redemption pursuant to paragraph 5
of the Securities, upon acceleration or otherwise, or failure by the Company to
redeem or purchase Securities when required; (iii) failure by the Company or any
Subsidiary Guarantor to comply with other agreements in the Indenture or the
Securities, in certain cases subject to notice and lapse of time; (iv) certain
accelerations (including failure to pay within any grace period after final
maturity) of other Indebtedness of the Company or any Significant Subsidiary if
the amount accelerated (or so unpaid) exceeds $10 million; (v) certain events of
bankruptcy or insolvency with respect to the Company and the Significant
Subsidiaries; (vi) certain judgments or decrees for the payment of money in
excess of $10 million; and (vii) certain defaults with respect to Subsidiary
Guaranties. If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the Securities may declare all
the Securities to be due and payable immediately. Certain events of bankruptcy
or insolvency are Events of Default which will result in the Securities being
due and payable immediately upon the occurrence of such Events of Default.

                  Securityholders may not enforce the Indenture or the
Securities except as provided in the Indenture. The Trustee may refuse to
enforce the Indenture or the Securities unless it receives indemnity or security
satisfactory to it. Subject to certain limitations, Holders of a majority in
principal amount of the Securities may direct the Trustee in its exercise of any
trust or power. The Trustee may withhold from Securityholders notice of any
continuing Default (except a Default in payment of principal or interest) if it
determines that withholding notice is not opposed to the interest of the
Holders.

16.  Trustee Dealings with the Company

                  Subject to certain limitations imposed by the Act, the Trustee
under the Indenture, in its individual or any other capacity, may become the
owner or pledgee of Securities and may otherwise deal with and collect
obligations owed to it by the Company or its Affiliates and may otherwise deal
with the Company or its Affiliates with the same rights it would have if it were
not Trustee.

17.  No Recourse Against Others

                  A director, officer, employee or stockholder, as such, of the
Company or the Trustee shall not have any liability for any obligations of the
Company under the Securities or the Indenture or for any claim based on, in
respect of or by reason of such obligations or their

                                       7
<PAGE>

creation. By accepting a Security, each Securityholder waives and releases all
such liability. The waiver and release are part of the consideration for the
issue of the Securities.

18.  Authentication

                  This Security shall not be valid until an authorized signatory
of the Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Security.

19.  Abbreviations

                  Customary abbreviations may be used in the name of a
Securityholder or an assignee, such as TEN COM (=tenants in common), TEN ENT
(=tenants by the entireties), JT TEN (=joint tenants with rights of survivorship
and not as tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to
Minors Act).

20.  CUSIP Numbers

                  Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures the Company has caused CUSIP numbers
to be printed on the Securities and has directed the Trustee to use CUSIP
numbers in notices of redemption as a convenience to Securityholders. No
representation is made as to the accuracy of such numbers either as printed on
the Securities or as contained in any notice of redemption and reliance may be
placed only on the other identification numbers placed thereon.

21.  Holders' Compliance with Registration Rights Agreement

                  Each Holder of a Security, by acceptance hereof, acknowledges
and agrees to the provisions of the Registration Rights Agreement, including the
obligations of the Holders with respect to a registration and the
indemnification of the Company to the extent provided therein.

22.  Governing Law

                  THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO
APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF
THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

                                       8
<PAGE>

                  The Company will furnish to any Securityholder upon written
request and without charge to the Securityholder a copy of the Indenture which
has in it the text of this Security in larger type. Requests may be made to:

                  Encore Acquisition Company
                  777 Main Street, Suite 1400
                  Fort Worth, TX 76102
                  Attention: Assistant Treasurer

                                       9<PAGE>
                                                                    Exhibit 10.3

                                FACILITY GUARANTY

         THIS FACILITY GUARANTY (this "GUARANTY") is dated as of the ____ day of
__________, ____, by [Subsidiary of Borrower, a ____________] ("GUARANTOR"), in
favor of FLEET NATIONAL BANK, ___________________, ________________, and each of
the other financial institutions listed on Schedule 1 to the Credit Agreement
(as hereinafter defined) as Banks, and each of their successors and assigns as
permitted pursuant to the Credit Agreement (Fleet National Bank acting as a Bank
but not as Administrative Agent, Wachovia Bank, N.A. acting as a Bank but not as
Syndication Agent, Fortis Capital Corp. acting as a Bank but not as
Documentation Agent, each of the other Banks listed on Schedule 1 of the Credit
Agreement, and each of their successors and assigns are collectively referred to
herein as "NOTEHOLDERS").

                                  WITNESSETH:

         WHEREAS, Encore Acquisition Company, a Delaware corporation
("BORROWER"), [Guarantor] [Encore Operating, L.P., a Texas limited partnership,
as a Subsidiary Guarantor], Noteholders, Fleet National Bank, as Administrative
Agent ("ADMINISTRATIVE AGENT"), Wachovia Bank, N.A., as Syndication Agent, and
Fortis Capital Corp., as Documentation Agent are parties to that certain Credit
Agreement (as from time to time amended, the "CREDIT AGREEMENT") dated as of
June 25, 2002, pursuant to which Noteholders have made a revolving credit loan
to Borrower and agreed to issue and participate in letters of credit issued on
behalf of Borrower (unless otherwise defined herein, all terms used herein with
their initial letter capitalized shall have the meaning given such terms in the
Credit Agreement); and

         WHEREAS, Noteholders have required, as a condition to the extension
and/or the continued extension of credit under the Credit Agreement, that
Guarantor execute and deliver this Guaranty; and

         WHEREAS, Guarantor has determined that valuable benefits will be
derived by it as a result of the Credit Agreement and the extension of credit
made (and/or to be made) by Noteholders thereunder; and

         WHEREAS, Guarantor has further determined that the benefits accruing to
it from the Credit Agreement exceed Guarantor's anticipated liability under this
Guaranty.

         NOW, THEREFORE, for valuable consideration, the receipt and sufficiency
of which are hereby acknowledged and confessed, Guarantor hereby covenants and
agrees as follows:

         1. Guarantor hereby absolutely and unconditionally guarantees the
prompt, complete and full payment when due, no matter how such shall become due,
of the Obligations, and further guarantees that Borrower will properly and
timely perform the Obligations. Notwithstanding any contrary provision in this
Guaranty, however, Guarantor's maximum liability under this Guaranty is limited,
to the extent, if any, required so that its liability is not subject to
avoidance under applicable Debtor Relief Laws (as such term is defined in
Paragraph 8 hereof).

         2. If Guarantor is or becomes liable for any indebtedness owing by
Borrower to any Noteholder by endorsement or otherwise than under this Guaranty,
such liability shall not be in any manner impaired or affected hereby, and the
rights of Noteholders hereunder shall be

<PAGE>

cumulative of any and all other rights that Noteholders may ever have against
Guarantor. The exercise by any Noteholder of any right or remedy hereunder or
under any other instrument, at law or in equity, shall not preclude the
concurrent or subsequent exercise of any other right or remedy.

         3. In the event of default by Borrower in payment of the Obligations,
or any part thereof, when such Obligations become due, either by their terms or
as the result of the exercise of any power to accelerate, Guarantor shall, on
demand, and without further notice of dishonor and without any notice having
been given to Guarantor previous to such demand of the acceptance by Noteholders
of this Guaranty, and without any notice having been given to such Guarantor
previous to such demand of the creating or incurring of such Obligations, pay
the amount due thereon to Noteholders at Administrative Agent's office as set
forth in the Credit Agreement, and it shall not be necessary for any Noteholder,
in order to enforce such payment by Guarantor, first, to institute suit or
exhaust its remedies against Borrower or others liable on such Obligations, to
have Borrower joined with Guarantor in any suit brought under this Guaranty or
to enforce their rights against any security which shall ever have been given to
secure such indebtedness; provided, however, that in the event any Noteholder
elects to enforce and/or exercise any remedies they may possess with respect to
any security for the Obligations prior to demanding payment from Guarantor,
Guarantor shall nevertheless be obligated hereunder for any and all sums still
owing to Noteholders on the Obligations and not repaid or recovered incident to
the exercise of such remedies.

         4. Notice to Guarantor of the acceptance of this Guaranty and of the
making, renewing or assignment of the Obligations and each item thereof, are
hereby expressly waived by Guarantor.

         5. Each payment on the Obligations shall be deemed to have been made by
Borrower unless express written notice is given to Noteholders at the time of
such payment that such payment is made by Guarantor as specified in such notice.

         6. If all or any part of the Obligations at any time are secured,
Guarantor agrees that Administrative Agent and/or Noteholders may at any time
and from time to time, at their discretion and with or without valuable
consideration, allow substitution or withdrawal of collateral or other security
and release collateral or other security or compromise or settle any amount due
or owing under the Credit Agreement or amend or modify in whole or in part the
Credit Agreement or any Loan Paper executed in connection with same without
impairing or diminishing the obligations of Guarantor hereunder. Guarantor
further agrees that if Borrower executes in favor of any Noteholder any
collateral agreement, mortgage or other security instrument, the exercise by any
Noteholder of any right or remedy thereby conferred on such Noteholder shall be
wholly discretionary with such Noteholder, and that the exercise or failure to
exercise any such right or remedy shall in no way impair or diminish the
obligation of Guarantor hereunder. Guarantor further agrees that Noteholders and
Administrative Agent shall not be liable for their failure to use diligence in
the collection of the Obligations or in preserving the liability of any Person
liable for the Obligations, and Guarantor hereby waives presentment for payment,
notice of nonpayment, protest and notice thereof (including, notice of
acceleration), and diligence in bringing suits against any Person liable on the
Obligations, or any part thereof.

         7. Guarantor agrees that Noteholders, in their discretion, may (i)
bring suit against all guarantors (including, without limitation, Guarantor
hereunder) of the Obligations jointly and

                                       2
<PAGE>

severally or against any one or more of them, (ii) compound or settle with any
one or more of such guarantors for such consideration as Noteholders may deem
proper, and (iii) release one or more of such guarantors from liability
hereunder, and that no such action shall impair the rights of Noteholders to
collect the Obligations (or the unpaid balance thereof) from other such
guarantors of the Obligations, or any of them, not so sued, settled with or
released. Guarantor agrees, however, that nothing contained in this paragraph,
and no action by Noteholders permitted under this paragraph, shall in any way
affect or impair the rights or obligations of such guarantors among themselves.

         8. Guarantor represents and warrants to each Noteholder that (i)
Guarantor is a corporation, limited liability company or partnership duly
organized and validly existing under the laws of the jurisdiction of its
incorporation or formation; and (ii) Guarantor possesses all requisite authority
and power to authorize, execute, deliver and comply with the terms of this
Guaranty; this Guaranty has been duly authorized and approved by all necessary
action on the part of Guarantor and constitutes a valid and binding obligation
of Guarantor enforceable in accordance with its terms, except as the enforcement
thereof may be limited by applicable Debtor Relief Laws; and no approval or
consent of any court or governmental entity is required for the authorization,
execution, delivery or compliance with this Guaranty which has not been obtained
(and copies thereof delivered to Noteholders). As used in this Guaranty, the
term "DEBTOR RELIEF LAWS" means the Bankruptcy Code of the United States of
America and all other applicable liquidation, conservatorship, bankruptcy,
moratorium, rearrangement, receivership, insolvency, reorganization, suspension
of payments or similar debtor relief Laws from time to time in effect affecting
the rights of creditors generally.

         9. Guarantor covenants and agrees that until the Obligations are paid
and performed in full, except as otherwise provided in the Credit Agreement or
unless Noteholders give their prior written consent to any deviation therefrom,
it will (i) at all times maintain its existence and authority to transact
business in any State or jurisdiction where Guarantor has assets and operations,
(ii) promptly deliver to Noteholders and to Administrative Agent such
information respecting its business affairs, assets and liabilities as
Noteholders may reasonably request, and (iii) duly and punctually observe and
perform all covenants applicable to Guarantor under the Credit Agreement and the
other Loan Papers. The failure of Guarantor to comply with the terms of this
paragraph shall be an Event of Default under the Credit Agreement.

         10. This Guaranty is for the benefit of Noteholders, their successors
and assigns, and in the event of an assignment by Noteholders (or their
successors or assigns) of the Obligations, or any part thereof, the rights and
benefits hereunder, to the extent applicable to the Obligations so assigned, may
be transferred with such Obligations. This Guaranty is binding upon Guarantor
and its successors and assigns.

         11. No modification, consent, amendment or waiver of any provision of
this Guaranty, nor consent to any departure by Guarantor therefrom, shall be
effective unless the same shall be in writing and signed by each Noteholder, and
then shall be effective only in the specific instance and for the purpose for
which given. No notice to or demand on Guarantor in any case shall, of itself,
entitle Guarantor to any other or further notice or demand in similar or other
circumstances. No delay or omission by Noteholders in exercising any power or
right hereunder shall impair any such right or power or be construed as a waiver
thereof or any acquiescence therein, nor shall any single or partial exercise of
any such power preclude other or further exercise thereof, or the exercise of
any other right or power hereunder. All rights and

                                       3
<PAGE>

remedies of Noteholders hereunder are cumulative of each other and of every
other right or remedy which Noteholders may otherwise have at law or in equity
or under any other contract or document, and the exercise of one or more rights
or remedies shall not prejudice or impair the concurrent or subsequent exercise
of other rights or remedies.

         12. No provision herein or in any promissory note, instrument or any
other Loan Paper executed by Borrower or Guarantor evidencing the Obligations
shall require the payment or permit the collection of interest in excess of the
Maximum Lawful Rate. If any excess of interest in such respect is provided for
herein or in any such promissory note, instrument, or any other Loan Paper, the
provisions of this paragraph shall govern, and neither Borrower nor Guarantor
shall be obligated to pay the amount of such interest to the extent that it is
in excess of the amount permitted by law. The intention of the parties being to
conform strictly to any applicable federal or state usury Laws now in force, all
promissory notes, instruments and other Loan Papers executed by Borrower or
Guarantor evidencing the Obligations shall be held subject to reduction to the
amount allowed under said usury Laws as now or hereafter construed by the courts
having jurisdiction.

         13. If Guarantor should breach or fail to perform any provision of this
Guaranty, Guarantor agrees to pay Noteholders all costs and expenses (including
court costs and reasonable attorneys fees) incurred by Noteholders in the
enforcement hereof.

         14. (a) The liability of Guarantor under this Guaranty shall in no
manner be impaired, affected or released by the insolvency, bankruptcy, making
of an assignment for the benefit of creditors, arrangement, compensation,
composition or readjustment of Borrower, or any proceedings affecting the
status, existence or assets of Borrower or other similar proceedings instituted
by or against Borrower and affecting the assets of Borrower.

             (b) Guarantor acknowledges and agrees that any interest on any
portion of the Obligations which accrues after the commencement of any
proceeding referred to in clause (a) above (or, if interest on any portion of
the Obligations ceases to accrue by operation of law by reason of the
commencement of said proceeding, such interest as would have accrued on such
portion of the Obligations if said proceedings had not been commenced) shall be
included in the Obligations because it is the intention of Guarantor,
Administrative Agent and Noteholders that the Obligations which are guaranteed
by Guarantor pursuant to this Guaranty should be determined without regard to
any rule of law or order which may relieve Borrower of any portion of such
Obligations. Guarantor will permit any trustee in bankruptcy, receiver, debtor
in possession, assignee for the benefit of creditors or similar Person to pay
Noteholders or Administrative Agent, or allow the claim of Noteholders or
Administrative Agent in respect of, any such interest accruing after the date on
which such proceeding is commenced.

             (c) In the event that all or any portion of the Obligations are
paid by Borrower, the obligations of Guarantor hereunder shall continue and
remain in full force and effect or be reinstated, as the case may be, in the
event that all or any part of such payment(s) are rescinded or recovered
directly or indirectly from Administrative Agent or any Noteholder as a
preference, fraudulent transfer or otherwise, and any such payments which are so
rescinded or recovered shall constitute Obligations for all purposes under this
Guaranty.

         15. Guarantor understands and agrees that any amounts of Guarantor
on account with any Noteholder may be offset to satisfy the obligations of
Guarantor hereunder.

                                       4
<PAGE>

         16. Guarantor hereby subordinates and makes inferior any and all
indebtedness now or at any time hereafter owed by Borrower to Guarantor to the
Obligations evidenced by the Credit Agreement and agrees after the occurrence of
a Default or Event of Default under the Credit Agreement, not to permit Borrower
to repay, or to accept payment from Borrower of, such indebtedness or any part
thereof without the prior written consent of Noteholders.

         17. During the period that Noteholders have any commitment to lend or
participate in Letter of Credit Exposure under the Loan Papers, or any amount
payable under any Note remains unpaid or any Letter of Credit remains
outstanding, and throughout any additional preferential period subsequent
thereto, Guarantor hereby waives any and all rights of subrogation to which
Guarantor may otherwise be entitled against Borrower, or any other guarantor of
the Obligations, as a result of any payment made by Guarantor pursuant to this
Guaranty.

         18. As of the date hereof, the fair saleable value of the property of
Guarantor is greater than the total amount of liabilities (including contingent
and unliquidated liabilities) of Guarantor, and Guarantor is able to pay all of
its liabilities as such liabilities mature and Guarantor does not have
unreasonably small capital within the meaning of Section 548, Title 11, United
States Code, as amended. In computing the amount of contingent or liquidated
liabilities, such liabilities have been computed at the amount which, in light
of all the facts and circumstances existing as of the date hereof, represents
the amount that can reasonably be expected to become an actual or matured
liability.

         19. If any provision of this Guaranty is held to be illegal, invalid,
or unenforceable, such provision shall be fully severable; this Guaranty shall
be construed and enforced as if such illegal, invalid, or unenforceable
provision had never comprised a part hereof; and the remaining provisions hereof
shall remain in full force and effect and shall not be affected by the illegal,
invalid, or unenforceable provision or by its severance herefrom. Furthermore,
in lieu of such illegal, invalid, or unenforceable provision there shall be
added automatically as a part of this Guaranty a provision as similar in terms
to such illegal, invalid, or unenforceable provision as may be possible and be
legal, valid and enforceable.

         20. (a) Except to the extent required for the exercise of the remedies
provided in the other security instruments, Guarantor hereby irrevocably submits
to the nonexclusive jurisdiction of any Texas state or federal court over any
action or proceeding arising out of or relating to this Guaranty or any other
Loan Paper, and Guarantor hereby irrevocably agrees that all claims in respect
of such action or proceeding may be heard and determined in such Texas state or
federal court. Guarantor hereby irrevocably waives, to the fullest extent
permitted by Law, any objection which it may now or hereafter have to the laying
of venue of any Litigation (as hereinafter defined) arising out of or in
connection with this Guaranty or any of the Loan Papers brought in any Texas or
New York state or federal court. Guarantor hereby irrevocably waives any claim
that any Litigation brought in any such court has been brought in an
inconvenient forum. Guarantor hereby irrevocably consents to the service of
process out of any of the aforementioned courts in any such Litigation by the
mailing of copies thereof by certified mail, return receipt requested, postage
prepaid, to Guarantor's office at ____________________. Guarantor irrevocably
agrees that any legal proceeding against Noteholders shall be brought in the
district courts of New York County, New York, or in the United States District
Court for the Southern District of New York. Nothing herein shall affect the
right of any Noteholder to commence legal proceedings or otherwise proceed
against Guarantor in any jurisdiction or to serve process in any manner
permitted by applicable Law. As used herein, the term "LITIGATION"

                                       5
<PAGE>

means any proceeding, claim, lawsuit or investigation (i) conducted or
threatened by or before any court or governmental department, commission, board,
bureau, agency or instrumentality of the United States or of any state,
commonwealth, nation, territory, possession, county, parish, or municipality,
whether now or hereafter constituted or existing, or (ii) pending before any
public or private arbitration board or panel.

                  (b) Nothing in this Paragraph 20 shall affect any right of any
Noteholder to serve legal process in any other manner permitted by Law or affect
the right of any Noteholder to bring any action or proceeding against Guarantor
in the courts of any other jurisdictions.

                   (c) To the extent that Guarantor has or hereafter may acquire
any immunity from jurisdiction of any court or from any legal process (whether
through service or notice, attachment prior to judgment, attachment in aid of
execution, execution or otherwise) with respect to itself or its property,
Guarantor hereby irrevocably waives such immunity in respect of its obligations
under this Guaranty and the other Loan Papers.

         21. THIS GUARANTY AND THE OTHER LOAN PAPERS COLLECTIVELY REPRESENT THE
FINAL AGREEMENT BY AND AMONG NOTEHOLDERS, ADMINISTRATIVE AGENT, SYNDICATION
AGENT, DOCUMENTATION AGENT, AND GUARANTOR AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF
NOTEHOLDERS, ADMINISTRATIVE AGENT, SYNDICATION AGENT, DOCUMENTATION AGENT, AND
GUARANTOR. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG NOTEHOLDERS,
ADMINISTRATIVE AGENT, SYNDICATION AGENT, DOCUMENTATION AGENT, AND GUARANTOR.

         22. GUARANTOR, FOR ITSELF, ITS SUCCESSORS AND ASSIGNS, HEREBY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ITS RIGHT TO A JURY
TRIAL, IN ANY LITIGATION ARISING OUT OF OR IN CONNECTION WITH THIS GUARANTY OR
ANY OF THE OTHER LOAN PAPERS.

         23. THIS GUARANTY AND THE OTHER LOAN PAPERS SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF TEXAS.

         EXECUTED and effective as of the date first above written.

                                  GUARANTOR:

                                  [ENCORE OPERATING, L.P.]

                                  [SUBSIDIARY OF BORROWER]

                                  By:
                                     ------------------------------------------
                                  Name:
                                       ----------------------------------------
                                  Title:
                                        ---------------------------------------

                                       6

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