Document:

Exhibit
10.4

 

GUARANTY AGREEMENT

 

THIS GUARANTY AGREEMENT (this “Guaranty
Agreement”), dated as of December 9, 2003, is made by EACH OF THE UNDERSIGNED  AND EACH OTHER PERSON WHO SHALL BECOME A PARTY HERETO
BY EXECUTION OF A GUARANTY JOINDER AGREEMENT (each a “Guarantor”
and collectively the “Guarantors”) to BANK OF AMERICA, N.A., a
national banking association organized and existing under the laws of the
United States, as administrative agent (in such capacity, the “Administrative
Agent”) for each of the lenders (the “Lenders”) now or hereafter
party to the Credit Agreement defined below (collectively with the
Administrative Agent, and certain other Persons parties to Related Swap
Contracts as more particularly described in Section 19 hereof, the “Secured
Parties”).  All capitalized terms
used but not otherwise defined herein shall have the meanings ascribed to such
terms in the Credit Agreement.

 

W I T N E S S E T H:

 

WHEREAS, the Secured Parties have agreed to
provide to Precision Castparts Corp., an Oregon corporation (the “Borrower”),
certain credit facilities, including a term loan facility and revolving credit
facility with a letter of credit sublimit pursuant to the terms of that certain
Credit Agreement dated as of December 9, 2003, among the Borrower, the
Administrative Agent and the Lenders (as from time to time amended, modified,
supplemented or restated, the “Credit Agreement”); and

 

WHEREAS, each Guarantor is, directly or
indirectly, a Subsidiary of the Borrower and will materially benefit from the
Loans made and to be made, and the Letters of Credit issued and to be issued,
under the Credit Agreement; and

 

WHEREAS, each Guarantor is required to
enter into this Guaranty Agreement pursuant to the terms of the Credit
Agreement; and

 

WHEREAS, a material part of the
consideration given in connection with and as an inducement to the execution
and delivery of the Credit Agreement by the Secured Parties was the obligation
of the Borrower to cause each Guarantor to enter into this Guaranty Agreement,
and the Secured Parties are unwilling to extend and maintain the credit
facilities provided under the Loan Documents unless the Guarantors enter into
this Guaranty Agreement;

 

NOW, THEREFORE, in consideration of the
premises and mutual covenants contained herein, the parties hereto agree as
follows:

 

1.                                      Guaranty.  Each Guarantor hereby jointly and severally,
unconditionally, absolutely, continually and irrevocably guarantees to the
Administrative Agent for the benefit of the Secured Parties the payment and
performance in full of the Borrower’s Liabilities (as defined below).  For all purposes of this Guaranty Agreement,
“Borrower’s Liabilities” means: 
(a) the

 

 

Borrower’s prompt payment
in full, when due or declared due and at all such times, of all Obligations and
all other amounts pursuant to the terms of the Credit Agreement, the Notes, and
all other Loan Documents heretofore, now or at any time or times hereafter
owing, arising, due or payable from the Borrower to any one or more of the
Secured Parties, including principal, interest, premiums and fees (including,
but not limited to, loan fees and Attorney Costs); (b) the Borrower’s prompt,
full and faithful performance, observance and discharge of each and every
agreement, undertaking, covenant and provision to be performed, observed or
discharged by the Borrower under the Credit Agreement and all other Loan
Documents; and (c) the Borrower’s prompt payment in full, when due or declared
due and at all such times, of obligations and liabilities now or hereafter arising
under Related Swap Contracts.  The
Guarantors’ obligations to the Secured Parties under this Guaranty Agreement
are hereinafter collectively referred to as the “Guarantors’ Obligations”
and, with respect to each Guarantor individually, the “Guarantor’s
Obligations”.  Notwithstanding the
foregoing, the liability of each Guarantor individually with respect to its
Guarantor’s Obligations shall be limited to an aggregate amount equal to the
largest amount that would not render its obligations hereunder subject to
avoidance under Section 548 of the United States Bankruptcy Code or any
comparable provisions of any applicable state law.

 

Each Guarantor agrees that it is jointly and
severally, directly and primarily liable (subject to the limitation in the immediately
preceding sentence) for the Borrower’s Liabilities.

 

2.                                      Payment.                                              If
the Borrower shall default in payment or performance of any of the Borrower’s
Liabilities, whether principal, interest, premium, fee (including, but not
limited to, loan fees and Attorney Costs), or otherwise, when and as the same
shall become due, and after expiration of any applicable grace period, whether
according to the terms of the Credit Agreement, by acceleration, or otherwise,
or upon the occurrence and during the continuance of any Event of Default under
the Credit Agreement, then any or all of the Guarantors will, upon demand
thereof by the Administrative Agent, fully pay to the Administrative Agent, for
the benefit of the Secured Parties, subject to any restriction on each
Guarantor’s Obligations set forth in Section 1 hereof, an amount equal
to all the Borrower’s Liabilities then due and owing.

 

3.                                      Absolute
Rights and Obligations.  This is
a guaranty of payment and not of collection. 
The Guarantors’ Obligations under this Guaranty Agreement shall be joint
and several, absolute and unconditional irrespective of, and each Guarantor
hereby expressly waives, to the extent permitted by law, any defense to its
obligations under this Guaranty Agreement and all to which it is a party by
reason of:

 

(a)                                  any
lack of legality, validity or enforceability of the Credit Agreement, of any of
the Notes, of any other Loan Document, or of any other agreement or instrument
creating, providing security for, or otherwise relating to any of the
Guarantors’ Obligations, any of the Borrower’s Liabilities, or any other
guaranty of any of the Borrower’s Liabilities (the Loan Documents and all such
other agreements and instruments being collectively referred to as the “Related
Agreements”);

 

(b)                                 any
action taken under any of the Related Agreements, any exercise of any right or
power therein conferred, any failure or omission to enforce any right conferred
thereby, or any waiver of any covenant or condition therein provided;

 

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(c)                                  any
acceleration of the maturity of any of the Borrower’s Liabilities, of the
Guarantor’s Obligations of any other Guarantor, or of any other obligations or
liabilities of any Person under any of the Related Agreements;

 

(d)                                 any
release, exchange, non-perfection, lapse in perfection, disposal, deterioration
in value, or impairment of any security for any of the Borrower’s Liabilities,
for any of the Guarantor’s Obligations of any Guarantor, or for any other
obligations or liabilities of any Person under any of the Related Agreements;

 

(e)                                  any
dissolution of the Borrower or any Guarantor or any other party to a Related
Agreement, or the combination or consolidation of the Borrower or any Guarantor
or any other party to a Related Agreement into or with another entity or any
transfer or disposition of any assets of the Borrower or any Guarantor or any
other party to a Related Agreement;

 

(f)                                    any
extension (including without limitation extensions of time for payment),
renewal, amendment, restructuring or restatement of, any acceptance of late or
partial payments under, or any change in the amount of any borrowings or any
credit facilities available under, the Credit Agreement, any of the Notes or
any other Loan Document or any other Related Agreement, in whole or in part;

 

(g)                                 the
existence, addition, modification, termination, reduction or impairment of
value, or release of any other guaranty (or security therefor) of the
Borrower’s Liabilities (including without limitation the Guarantor’s
Obligations of any other Guarantor and obligations arising under any other
Guaranty now or hereafter in effect);

 

(h)                                 any
waiver of, forbearance or indulgence under, or other consent to any change in
or departure from any term or provision contained in the Credit Agreement, any
other Loan Document or any other Related Agreement, including without
limitation any term pertaining to the payment or performance of any of the
Borrower’s Liabilities, any of the Guarantor’s Obligations of any other Guarantor,
or any of the obligations or liabilities of any party to any other Related
Agreement;

 

(i)                                     any
other circumstance whatsoever (with or without notice to or knowledge of any
Guarantor) which may or might in any manner or to any extent vary the risks of
such Guarantor, or might otherwise constitute a legal or equitable defense
available to, or discharge of, a surety or a guarantor, including without
limitation any right to require or claim that resort be had to the Borrower or
any other Loan Party or to any collateral in respect of the Borrower’s
Liabilities or Guarantors’ Obligations, other than the indefeasible payment in
full of the Borrower’s Liabilities and the Guarantors’ Obligations.

 

It is the express purpose and intent of the parties hereto that this
Guaranty Agreement and the Guarantors’ Obligations hereunder and under each
Guaranty Joinder Agreement shall be

 

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absolute and unconditional under any and all circumstances and shall
not be discharged except by payment as herein provided.

 

4.                                      Currency
and Funds of Payment.  All
Guarantors’ Obligations will be paid in lawful currency of the United States of
America and in immediately available funds, regardless of any law, regulation
or decree now or hereafter in effect that might in any manner affect the
Borrower’s Liabilities, or the rights of any Secured Party with respect thereto
as against the Borrower, or cause or permit to be invoked any alteration in the
time, amount or manner of payment by the Borrower of any or all of the
Borrower’s Liabilities.

 

5.                                      Events
of Default.  Without limiting
the provisions of Section 2 hereof, in the event that there shall occur
and be continuing an Event of Default, then notwithstanding any collateral or
other security or credit support for the Borrower’s Liabilities, at the
Administrative Agent’s election and without notice thereof or demand therefor,
the Guarantors’ Obligations shall immediately be and become due and payable.

 

6.                                      Subordination.  Until this Guaranty Agreement is terminated
in accordance with Section 22 hereof, each Guarantor hereby
unconditionally subordinates all present and future debts, liabilities or
obligations now or hereafter owing to such Guarantor (a) of the Borrower, to
the payment in full of the Borrower’s Liabilities, (b) of every other Guarantor
(an “obligated guarantor”), to the payment in full of the Guarantors’
Obligations of such obligated guarantor, and (c) of each other Person now or
hereafter constituting a Loan Party, to the payment in full of the obligations
of such Loan Party owing to any Secured Party and arising under the Loan
Documents.  All amounts due under such
subordinated debts, liabilities, or obligations shall, upon the occurrence and
during the continuance of an Event of Default, be collected and, upon request
by the Administrative Agent, paid over forthwith to the Administrative Agent
for the benefit of the Secured Parties on account of the Borrower’s
Liabilities, the Guarantors’ Obligations, or such other obligations, as
applicable, and, after such request and pending such payment, shall be held by
such Guarantor as agent and bailee of the Secured Parties separate and apart
from all other funds, property and accounts of such Guarantor.

 

7.                                      Suits.  Each Guarantor from time to time shall pay
to the Administrative Agent for the benefit of the Secured Parties, on demand,
at the Administrative Agent’s place of business set forth in the Credit
Agreement or such other address as the Administrative Agent shall give notice
of to such Guarantor, the Guarantors’ Obligations as they become or are
declared due, and in the event such payment is not made forthwith, the
Administrative Agent may proceed to suit against any one or more or all of the
Guarantors.  At the Administrative Agent’s
election, one or more and successive or concurrent suits may be brought hereon
by the Administrative Agent against any one or more or all of the Guarantors,
whether or not suit has been commenced against the Borrower, any other
Guarantor, or any other Person and whether or not the Secured Parties have
taken or failed to take any other action to collect all or any portion of the
Borrower’s Liabilities or have taken or failed to take any actions against any
collateral securing payment or performance of all or any portion of the
Borrower’s Liabilities, and irrespective of any event, occurrence, or condition
described in Section 3 hereof.

 

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8.                                      Set-Off
and Waiver.  Each Guarantor
waives any right to assert against any Secured Party as a defense,
counterclaim, set-off, recoupment or cross claim in respect of its Guarantor’s
Obligations, any defense (legal or equitable) or other claim which such
Guarantor may now or at any time hereafter have against the Borrower or any or
all of the Secured Parties without waiving any additional defenses, set-offs,
counterclaims or other claims otherwise available to such Guarantor.  Each Guarantor agrees that each Secured
Party shall have a lien for all the Guarantor’s Obligations upon all deposits
or deposit accounts, of any kind, or any interest in any deposits or deposit
accounts, now or hereafter pledged, mortgaged, transferred or assigned to such
Secured Party or otherwise in the possession or control of such Secured Party for
any purpose (other than solely for safekeeping) for the account or benefit of
such Guarantor, including any balance of any deposit account or of any credit
of such Guarantor with the Secured Party, whether now existing or hereafter
established, and hereby authorizes each Secured Party from and after the
occurrence of an Event of Default at any time or times with or without prior
notice to apply such balances or any part thereof to such of the Guarantor’s
Obligations to the Secured Parties then due and in such amounts as provided for
in the Credit Agreement or otherwise as they may elect.  Each Secured Party agrees promptly to notify
the Borrower and the applicable Guarantor after any such set-off and
application made by such Secured Party; provided, however, that
the failure to give such notice shall not affect the validity of such set-off
or application.  For the purposes of
this Section 8, all remittances and property shall be deemed to be in
the possession of a Secured Party as soon as the same may be put in transit to
it by mail or carrier or by other bailee.

 

9.                                      Waiver
of Notice; Subrogation.

 

(a)                                  Each
Guarantor hereby waives to the extent permitted by law notice of the following
events or occurrences:  (i) acceptance
of this Guaranty Agreement; (ii) the Lenders’ heretofore, now or from time to
time hereafter making Loans and issuing Letters of Credit and otherwise loaning
monies or giving or extending credit to or for the benefit of the Borrower,
whether pursuant to the Credit Agreement or the Notes or any other Loan
Document or Related Agreement or any amendments, modifications, or supplements
thereto, or replacements or extensions thereof; (iii) presentment, demand,
default, non-payment, partial payment and protest; and (iv) any other event,
condition, or occurrence described in Section 3 hereof.  Each Guarantor agrees that each Secured
Party may heretofore, now or at any time hereafter do any or all of the
foregoing in such manner, upon such terms and at such times as each Secured
Party, in its sole and absolute discretion, deems advisable, without in any way
or respect impairing, affecting, reducing or releasing such Guarantor from its
Guarantor’s Obligations, and each Guarantor hereby consents to each and all of
the foregoing events or occurrences.

 

(b)                                 Each
Guarantor hereby agrees that payment or performance by such Guarantor of its
Guarantor’s Obligations under this Guaranty Agreement may be enforced by the
Administrative Agent on behalf of the Secured Parties upon demand by the
Administrative Agent to such Guarantor without the Administrative Agent being
required, such Guarantor expressly waiving to the extent permitted by law any
right it may have to require the Administrative Agent to (i) prosecute
collection or seek to enforce or resort to any remedies against the Borrower or
any other Guarantor or any

 

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other guarantor of the Borrower’s Liabilities, or (ii)
seek to enforce or resort to any remedies with respect to any security
interests, Liens or encumbrances granted to the Administrative Agent or any
Lender or other party to a Related Agreement by the Borrower, any other
Guarantor or any other Person on account of the Borrower’s Liabilities or any
guaranty thereof, IT BEING EXPRESSLY UNDERSTOOD, ACKNOWLEDGED AND AGREED
TO BY SUCH GUARANTOR THAT DEMAND UNDER THIS GUARANTY AGREEMENT MAY BE MADE BY
THE ADMINISTRATIVE AGENT, AND THE PROVISIONS HEREOF ENFORCED BY THE
ADMINISTRATIVE AGENT, EFFECTIVE AS OF THE FIRST DATE ANY EVENT OF DEFAULT
OCCURS AND IS CONTINUING UNDER THE CREDIT AGREEMENT.

 

(c)                                  Each
Guarantor further agrees with respect to this Guaranty Agreement that it shall
have no right of subrogation, reimbursement, contribution or indemnity, nor any
right of recourse to security for the Borrower’s Liabilities unless and until
93 days immediately following the Facility Termination Date (as defined below)
shall have elapsed without the filing or commencement, by or against any Loan
Party, of any state or federal action, suit, petition or proceeding seeking any
reorganization, liquidation or other relief or arrangement in respect of
creditors of, or the appointment of a receiver, liquidator, trustee or
conservator in respect to, such Loan Party or its assets.  This waiver is expressly intended to prevent
the existence of any claim in respect to such subrogation, reimbursement,
contribution or indemnity by any Guarantor against the estate of any other Loan
Party within the meaning of Section 101 of the Bankruptcy Code, in the event of
a subsequent case involving any other Loan Party.  If an amount shall be paid to any Guarantor on account of such
rights at any time prior to termination of this Guaranty Agreement in
accordance with the provisions of Section 22 hereof, such amount shall
be held in trust for the benefit of the Secured Parties and shall forthwith be
paid to the Administrative Agent, for the benefit of the Secured Parties, to be
credited and applied upon the Guarantors’ Obligations, whether matured or
unmatured, in accordance with the terms of the Credit Agreement or otherwise as
the Secured Parties may elect.  The
agreements in this subsection shall survive repayment of all of the Guarantors’
Obligations, the termination or expiration of this Guaranty Agreement in any
manner, including but not limited to termination in accordance with Section
22 hereof, and occurrence of the Facility Termination Date.  For purposes of this Guaranty Agreement, “Facility
Termination Date” means the date as of which all of the following shall
have occurred:  (i) the Borrower shall
have permanently terminated the credit facilities under the Loan Documents by
final payment in full of all Outstanding Amounts, together with all accrued and
unpaid interest and fees thereon, other than (A) the undrawn portion of Letters
of Credit and (B) all letter of credit fees relating thereto accruing after
such date (which fees shall be payable solely for the account of the L/C Issuer
and shall be computed (based on interest rates and the Applicable Rate then in
effect) on such undrawn amounts to the respective expiry dates of the Letters
of Credit), in each case as have been fully Cash Collateralized or as to which
other arrangements with respect thereto satisfactory to the Administrative
Agent and the L/C Issuer shall have been made; (ii) all Revolving Credit
Commitments shall have terminated or expired; (iii) the obligations and
liabilities of the Borrower and each other Loan Party under all Related

 

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Swap Contracts shall have been fully, finally and
irrevocably paid and satisfied in full and the Related Swap Contract shall have
expired or been terminated, or other arrangements satisfactory to the
counterparties shall have been made with respect thereto; and (iv) the Borrower
and each other Loan Party shall have fully, finally and irrevocably paid and
satisfied in full all of their respective obligations and liabilities arising
under the Loan Documents, including with respect to the Borrower and the
Obligations (except for future obligations consisting of continuing indemnities
and other contingent Obligations of the Borrower or any Loan Party that may be
owing to any Agent-Related Person or any Lender pursuant to the Loan Documents
and expressly survive termination of the Credit Agreement).

 

10.                               Effectiveness;
Enforceability.  This Guaranty
Agreement shall be effective as of the date first above written and shall
continue in full force and effect until termination in accordance with Section
22 hereof.  Any claim or claims that
the Secured Parties may at any time hereafter have against a Guarantor under
this Guaranty Agreement may be asserted by the Administrative Agent on behalf
of the Secured Parties by written notice directed to such Guarantor in
accordance with Section 24 hereof.

 

11.                               Representations
and Warranties.  Each Guarantor
warrants and represents to the Administrative Agent, for the benefit of the
Secured Parties, that it is duly authorized to execute and deliver this
Guaranty Agreement (or the Guaranty Joinder Agreement to which it is a party,
as applicable), and to perform its obligations under this Guaranty Agreement,
that this Guaranty Agreement (or the Guaranty Joinder Agreement to which it is
a party, as applicable) has been duly executed and delivered on behalf of such
Guarantor by its duly authorized representatives; that this Guaranty Agreement
(and any Guaranty Joinder Agreement to which such Guarantor is a party) is
legal, valid, binding and enforceable against such Guarantor in accordance with
its terms except as enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors’ rights generally and by general equitable principles; and that such
Guarantor’s execution, delivery and performance of this Guaranty Agreement (and
any Guaranty Joinder Agreement to which such Guarantor is a party) do not
violate or constitute a breach of any of its Organizational Documents, any
agreement or instrument to which such Guarantor is a party, or any law, order,
regulation, decree or award of any governmental authority or arbitral body to
which it or its properties or operations is subject.

 

12.                               Expenses.  Each Guarantor agrees to be jointly and
severally liable for the payment of all reasonable fees and expenses, including
Attorney Costs, incurred by any Secured Party in connection with the
enforcement of this Guaranty Agreement, whether or not suit be brought.

 

13.                               Reinstatement.  Each Guarantor agrees that this Guaranty
Agreement shall continue to be effective or be reinstated, as the case may be,
at any time payment received by any Secured Party in respect of any Borrower’s
Liabilities is rescinded or must be restored for any reason, or is repaid by
any Secured Party in whole or in part in good faith settlement of any pending
or threatened avoidance claim.

 

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14.                               Attorney-in-Fact.  To the extent permitted by law, each
Guarantor hereby appoints the Administrative Agent, for the benefit of the
Secured Parties, as such Guarantor’s attorney-in-fact for the purposes of
carrying out the provisions of this Guaranty Agreement and taking any action
and executing any instrument which the Administrative Agent may deem necessary
or advisable to accomplish the purposes hereof, which appointment is coupled
with an interest and is irrevocable; provided, that the Administrative
Agent shall have and may exercise rights under this power of attorney only upon
the occurrence and during the continuance of an Event of Default.

 

15.                               Reliance.  Each Guarantor represents and warrants to
the Administrative Agent, for the benefit of the Secured Parties, that:  (a) such Guarantor has adequate means to
obtain on a continuing basis (i) from the Borrower, information concerning the
Borrower and the Borrower’s financial condition and affairs and (ii) from other
reliable sources such other information as it deems material in deciding to
provide this Guaranty Agreement and any Guaranty Joinder Agreement (“Other
Information”), and has full and complete access to the Borrower’s books and
records and to such Other Information; (b) such Guarantor is not relying on any
Secured Party or its or their employees, directors, agents or other
representatives or Affiliates, to provide any such information, now or in the
future; (c) such Guarantor has been furnished with and reviewed the terms of
the Credit Agreement and such other Loan Documents as it has requested, is
executing this Guaranty Agreement (or the Guaranty Joinder Agreement to which
it is a party, as applicable) freely and deliberately, and understands the
obligations and financial risk undertaken by providing this Guaranty Agreement
(and any Guaranty Joinder Agreement); (d) such Guarantor has relied solely on
the Guarantor’s own independent investigation, appraisal and analysis of the
Borrower, the Borrower’s financial condition and affairs, the “Other
Information”, and such other matters as it deems material in deciding to
provide this Guaranty Agreement (and any Guaranty Joinder Agreement) and is fully
aware of the same; and (e) such Guarantor has not depended or relied on any
Secured Party or its or their employees, directors, agents or other
representatives or Affiliates, for any information whatsoever concerning the
Borrower or the Borrower’s financial condition and affairs or any other matters
material to such Guarantor’s decision to provide this Guaranty Agreement (and
any Guaranty Joinder Agreement), or for any counseling, guidance, or special
consideration or any promise therefor with respect to such decision.  Each Guarantor agrees that no Secured Party
has any duty or responsibility whatsoever, now or in the future, to provide to
such Guarantor any information concerning the Borrower or the Borrower’s financial
condition and affairs, or any Other Information, other than as expressly
provided herein, and that, if such Guarantor receives any such information from
any Secured Party or its or their employees, directors, agents or other
representatives or Affiliates, such Guarantor will independently verify the
information and will not rely on any Secured Party or its or their employees,
directors, agents or other representatives or Affiliates, with respect to such
information.

 

16.                               Rules
of Interpretation.  The rules of
interpretation contained in Sections 1.02 and 1.05 of the Credit
Agreement shall be applicable to this Guaranty Agreement and each Guaranty
Joinder Agreement and are hereby incorporated by reference.  All representations and warranties contained
herein shall survive the delivery of documents and any extension of credit
referred to herein or guaranteed hereby.

 

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17.                               Entire
Agreement.  This Guaranty
Agreement and each Guaranty Joinder Agreement, together with the Credit
Agreement and other Loan Documents, constitute and express the entire
understanding between the parties hereto with respect to the subject matter
hereof, and supersede all prior negotiations, agreements, understandings,
inducements, commitments or conditions, express or implied, oral or written,
except as herein contained.  The express
terms hereof control and supersede any course of performance or usage of the
trade inconsistent with any of the terms hereof.  Except as provided in Section 22, neither this Guaranty
Agreement nor any Guaranty Joinder Agreement nor any portion or provision
hereof or thereof may be changed, altered, modified, supplemented, discharged,
canceled, terminated, or amended orally or in any manner other than as provided
in the Credit Agreement.

 

18.                               Binding
Agreement; Assignment.  This
Guaranty Agreement, each Guaranty Joinder Agreement and the terms, covenants
and conditions hereof and thereof shall be binding upon and inure to the
benefit of the parties hereto and thereto, and to their respective heirs, legal
representatives, successors and assigns; provided, however, that
no Guarantor shall be permitted to assign any of its rights, powers, duties or
obligations under this Guaranty Agreement, any Guaranty Joinder Agreement or
any other interest herein or therein without the prior written consent of the
Administrative Agent.  Without limiting
the generality of the foregoing sentence of this Section 18, any Lender
may assign to one or more Persons, or grant to one or more Persons
participations in or to, all or any part of its rights and obligations under
the Credit Agreement (to the extent permitted by the Credit Agreement); and to
the extent of any such assignment or participation such other Person shall, to
the fullest extent permitted by law, thereupon become vested with all the
benefits in respect thereof granted to such Lender herein or otherwise,
subject, however, to the provisions of the Credit Agreement, including Article
IX thereof (concerning the Administrative Agent) and Section 10.07
thereof (concerning assignments and participations).  All references herein to the Administrative Agent shall include
any successor thereof.

 

19.                               Related
Swap Contracts.  All obligations of the Borrower under
Related Swap Contracts to which any Lender or its Affiliates are a party shall
be deemed to be Borrower’s Liabilities, and each Lender or Affiliate of a
Lender party to any such Related Swap Contract shall be deemed to be a Secured
Party hereunder with respect to such Borrower’s Liabilities; provided, however,
that such obligations shall cease to be Borrower’s Liabilities at such time,
prior to the Facility Termination Date, as such Person (or Affiliate of such
Person) shall cease to be a “Lender” under the Credit Agreement.

 

No Person who obtains the
benefit of this Guaranty Agreement by virtue of the provisions of this Section
shall have, prior to the Facility
Termination Date, any right to notice of any action or to consent to,
direct or object to any action hereunder or under any other Loan Document or
otherwise in respect of the Guarantors’ Obligations (including the release or
modification of any Guarantors’ Obligations or security therefor) other than in
its capacity as a Lender and only to the extent expressly provided in the Loan
Documents.  Each Secured Party not a
party to the Credit Agreement who obtains the benefit of this Guaranty
Agreement by virtue of the provisions of this Section shall be deemed to have
acknowledged and accepted the appointment of the Administrative Agent pursuant
to the terms of the Credit Agreement, and that with respect to the actions and
omissions of the Administrative Agent hereunder or otherwise

 

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relating hereto that do or may affect such Secured
Party, the Administrative Agent and each Agent-Related Person shall be entitled
to all the rights, benefits and immunities conferred under Article IX of
the Credit Agreement.

 

20.                               Severability. 
The provisions of this Guaranty Agreement are independent of and
separable from each other.  If any
provision hereof shall for any reason be held invalid or unenforceable, such
invalidity or unenforceability shall not affect the validity or enforceability
of any other provision hereof, but this Guaranty Agreement shall be construed
as if such invalid or unenforceable provision had never been contained herein.

 

21.                               Counterparts. 
This Guaranty Agreement may be executed in any number of counterparts
each of which when so executed and delivered shall be deemed an original, and
it shall not be necessary in making proof of this Guaranty Agreement to produce
or account for more than one such counterpart executed by the Guarantor against
whom enforcement is sought.  Without
limiting the foregoing provisions of this Section 21, the provisions of Section
10.02(b) of the Credit Agreement shall be applicable to this Guaranty
Agreement.

 

22.                               Termination.

 

(a)                                  Subject
to reinstatement pursuant to Section 13 hereof, this Guaranty Agreement
and each Guaranty Joinder Agreement, and all of the Guarantors’ Obligations
hereunder (excluding those Guarantors’ Obligations relating to Borrower’s
Liabilities that expressly survive such termination) shall terminate without
delivery of any instrument or performance of any act by any party on the
Facility Termination Date.

 

(b)                                 With
respect to the Guarantor’s Obligations of any Guarantor Disposed of in
accordance with the Credit Agreement, the Guarantor’s Obligations of such
Guarantor shall terminate upon the consummation of the Disposition of such
Guarantor in accordance with the terms of the Credit Agreement.

 

23.                               Remedies
Cumulative; Late Payments.  All remedies hereunder are cumulative and
are not exclusive of any other rights and remedies of the Administrative Agent
or any other Secured Party provided by law or under the Credit Agreement, the
other Loan Documents or other applicable agreements or instruments.  The making of the Loans and other Credit
Extensions pursuant to the Credit Agreement shall be conclusively presumed to
have been made or extended, respectively, in reliance upon each Guarantor’s
guaranty of the Borrower’s Liabilities pursuant to the terms hereof.  Any amounts not paid when due under this
Guaranty Agreement shall bear interest at the Default Rate.

 

24.                               Notices. 
Any notice required or permitted hereunder or under any Guaranty Joinder
Agreement shall be given, (a) with respect to each Guarantor, at the address of
the Borrower indicated in Schedule 10.02 of the Credit Agreement  and
(b) with respect to the Administrative Agent or any other Secured Party, at the
Administrative Agent’s address indicated in Schedule 10.02 of the Credit
Agreement.  All such addresses may be
modified, and all such notices shall be given and shall be effective, as
provided in Section 10.02 of the Credit Agreement for the giving and
effectiveness of notices and modifications of addresses thereunder.

 

10

 

25.                               Joinder.  Each
Person who shall at any time execute and deliver to the Administrative Agent a
Guaranty Joinder Agreement substantially in the form attached as Exhibit A
hereto shall thereupon irrevocably, absolutely and unconditionally become a
party hereto and obligated hereunder as a Guarantor, and all references herein
and in the other Loan Documents to the Guarantors or to the parties to this
Guaranty Agreement shall be deemed to include such Person as a Guarantor
hereunder.

 

26.                               Governing
Law; Venue; Waiver of Jury Trial.

 

(a)                                  THIS
GUARANTY AGREEMENT AND EACH GUARANTY JOINDER AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE
TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.

 

(b)                                  EACH
GUARANTOR HEREBY EXPRESSLY AND IRREVOCABLY AGREES AND CONSENTS THAT ANY SUIT,
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY AGREEMENT OR
ANY GUARANTY JOINDER AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREIN OR
THEREIN MAY BE INSTITUTED IN ANY STATE OR FEDERAL COURT SITTING IN THE COUNTY
OF NEW YORK, STATE OF NEW YORK, UNITED STATES OF AMERICA AND, BY THE EXECUTION
AND DELIVERY OF THIS GUARANTY AGREEMENT OR A GUARANTY JOINDER AGREEMENT, SUCH
GUARANTOR EXPRESSLY WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO
THE LAYING OF VENUE IN, OR TO THE EXERCISE OF JURISDICTION OVER IT AND ITS
PROPERTY BY, ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING, AND EACH
GUARANTOR HEREBY IRREVOCABLY SUBMITS GENERALLY AND UNCONDITIONALLY TO THE
JURISDICTION OF ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING.

 

(c)                                  EACH
GUARANTOR AGREES THAT SERVICE OF PROCESS MAY BE MADE BY PERSONAL SERVICE OF A
COPY OF THE SUMMONS AND COMPLAINT OR OTHER LEGAL PROCESS IN ANY SUCH SUIT,
ACTION OR PROCEEDING, OR BY REGISTERED OR CERTIFIED MAIL (POSTAGE PREPAID) TO
THE ADDRESS FOR NOTICES TO SUCH GUARANTOR IN EFFECT PURSUANT TO SECTION 24
HEREOF, OR BY ANY OTHER METHOD OF SERVICE PROVIDED FOR UNDER THE APPLICABLE
LAWS IN EFFECT IN THE STATE OF NEW YORK.

 

(d)                                  NOTHING
CONTAINED IN SUBSECTIONS (b) or (c) HEREOF SHALL PRECLUDE THE ADMINISTRATIVE
AGENT FROM BRINGING ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING
TO THIS GUARANTY AGREEMENT OR ANY GUARANTY JOINDER AGREEMENT

 

11

 

OR ANY OTHER LOAN DOCUMENT IN THE COURTS OF ANY JURISDICTION
WHERE ANY GUARANTOR OR ANY OF SUCH GUARANTOR’S PROPERTY OR ASSETS MAY BE FOUND
OR LOCATED.  TO THE EXTENT PERMITTED BY
THE APPLICABLE LAWS OF ANY SUCH JURISDICTION, EACH GUARANTOR HEREBY IRREVOCABLY
SUBMITS TO THE JURISDICTION OF ANY SUCH COURT AND EXPRESSLY WAIVES, IN RESPECT
OF ANY SUCH SUIT, ACTION OR PROCEEDING, OBJECTION TO THE EXERCISE OF
JURISDICTION OVER IT AND ITS PROPERTY BY ANY SUCH OTHER COURT OR COURTS WHICH
NOW OR HEREAFTER MAY BE AVAILABLE UNDER APPLICABLE LAW.

 

(e)                                  IN
ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS OR REMEDIES UNDER OR
RELATED TO THIS GUARANTY AGREEMENT OR ANY GUARANTY JOINDER AGREEMENT OR ANY
AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR THAT MAY IN THE
FUTURE BE DELIVERED IN CONNECTION THEREWITH, EACH GUARANTOR AND THE
ADMINISTRATIVE AGENT ON BEHALF OF THE SECURED PARTIES HEREBY AGREE, TO THE
EXTENT PERMITTED BY APPLICABLE LAW, THAT ANY SUCH ACTION, SUIT OR PROCEEDING
SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY AND HEREBY IRREVOCABLY
WAIVE, TO THE EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT ANY SUCH PERSON MAY
HAVE TO TRIAL BY JURY IN ANY SUCH ACTION, SUIT OR PROCEEDING.

 

(f)                                    EACH GUARANTOR HEREBY EXPRESSLY WAIVES ANY OBJECTION IT MAY
HAVE THAT ANY COURT TO WHOSE JURISDICTION IT HAS SUBMITTED PURSUANT TO THE
TERMS HEREOF IS AN INCONVENIENT FORUM.

 

[Signature page follows.]

 

12

 

IN WITNESS WHEREOF,
the parties hereto have duly executed and delivered this Guaranty Agreement as
of the day and year first written above.

 

	
   

  	
  ADMINISTRATIVE AGENT:

  
	
   

  	
   

  
	
   

  	
  BANK
  OF AMERICA, N.A., as Administrative

  
	
   

  	
  Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ SUZIEANNA WAN

  	
   

  
	
   

  	
  Name:

  	
  SuzieAnna Wan

  
	
   

  	
  Title:

  	
  Assistant Vice President

  
					

 

 

	
   

  	
  GUARANTORS:

  
	
   

  	
   

  
	
   

  	
  PCC
  STRUCTURALS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  
	
   

  	
  PCC
  AIRFOILS LLC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  
	
   

  	
  PCC
  SPECIALTY PRODUCTS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /S/ GEOFFREY
  A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  
	
   

  	
  J&L
  FIBER SERVICES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /S/ GEOFFREY
  A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  
	
   

  	
  ADVANCED
  FORMING TECHNOLOGY, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /S/ GEOFFREY
  A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  
	
   

  	
  WYMAN-GORDON
  COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /S/ GEOFFREY
  A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
					

 

 

	
   

  	
  PRECISION
  FOUNDERS INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  
	
   

  	
  WYMAN-GORDON
  FORGINGS (CLEVELAND), INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  
	
   

  	
  WYMAN-GORDON
  FORGINGS LP

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
     By WGF I LLC, its General Partner

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  
	
   

  	
  WYMAN-GORDON
  INVESTMENT CASTINGS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
  SPS
  TECHNOLOGIES, LCC

    (f/k/a STAR ACQUISITION, LLC)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
  PCC
  COMPOSITES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
					

 

 

	
   

  	
  CARMET
  INVESTORS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  
	
   

  	
  CARMET
  COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  
	
   

  	
  WG
  WASHINGTON STREET LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
  WGF I
  LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  
	
   

  	
  WGF II
  LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
  WG
  FORGINGS 3 LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
					

 

 

	
   

  	
  WG
  FORGINGS 2 LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
  INTERNATIONAL
  EXTRUDED PRODUCTS, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
  CANNON-MUSKEGON
  CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
  GREENVILLE
  METALS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
  GREER
  STOP NUT, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
  HOWELL
  PENNCRAFT, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
					

 

 

	
   

  	
  M.
  ARGUESO & CO., INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
  METALAC
  FASTENERS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
  NSS
  TECHNOLOGIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
  SPS
  INTERNATIONAL INVESTMENT COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
  SPS
  TECHNOLOGIES WATERFORD COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
  UNBRAKO,
  LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
  AVIBANK
  MFG., INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ GEOFFREY A. HAWKES

  	
   

  
	
   

  	
  Name:

  	
  Geoffrey A. Hawkes

  
	
   

  	
  Title:

  	
  Treasurer

  
					

 

 

EXHIBIT A

 

Form of
Guaranty Joinder Agreement

 

 

GUARANTY
JOINDER AGREEMENT

 

THIS GUARANTY
JOINDER AGREEMENT (the “Guaranty
Joinder Agreement”), dated as of
                          ,
20     is made by
                                                              ,
a
                                
(the “Joining Guarantor”) pursuant to the terms of that certain Credit
Agreement (as amended, supplemented or restated from time to time, the “Credit
Agreement”), dated as of December     , 2003, by and
among Precision Castparts Corp., an Oregon corporation (the “Borrower”),
the Lenders party thereto and the Administrative Agent (as defined
therein).  All capitalized terms not
otherwise defined herein shall have the meanings given to such terms in the
Credit Agreement.

 

WHEREAS, the
Joining Guarantor is a Subsidiary and required by the terms of the Credit
Agreement to become a “Guarantor” under the Credit Agreement and be
joined as a party to the Guaranty; and

 

WHEREAS, the
Joining Guarantor will materially benefit directly and indirectly from the
credit facilities made available and to be made available to the Borrower by
the Lenders under the Credit Agreement;

 

NOW, THEREFORE, the
Joining Guarantor hereby agrees as follows, for the benefit of the Secured
Parties (as defined in the Guaranty and including any Lender or Affiliate of
any Lender party to a Related Swap Contract):

 

1.                                      Joinder.  The
Joining Guarantor hereby irrevocably, absolutely and unconditionally becomes a
party to the Guaranty as a Guarantor and bound by all the terms, conditions,
obligations, liabilities and undertakings of each Guarantor or to which each
Guarantor is subject thereunder, including without limitation the joint and
several, unconditional, absolute, continuing and irrevocable guarantee to the
Administrative Agent for the benefit of the Secured Parties of the payment and
performance in full of the Borrower’s Liabilities (as defined in the Guaranty)
whether now existing or hereafter arising, all with the same force and effect
as if the Joining Guarantor were a signatory to the Guaranty.

 

2.                                      Affirmations.  The Joining Guarantor hereby acknowledges
and reaffirms as of the date hereof with respect to itself, its properties and
its affairs each of the waivers, representations, warranties, acknowledgements
and certifications applicable to any Guarantor contained in the Guaranty.

 

3.                                      Severability. 
The provisions of this Guaranty Joinder Agreement are independent of and
separable from each other.  If any
provision hereof shall for any reason be held invalid or unenforceable, such
invalidity or unenforceability shall not affect the validity or enforceability
of any other provision hereof, but this Guaranty Joinder Agreement shall be
construed as if such invalid or unenforceable provision had never been
contained herein.

 

 

4.                                      Counterparts. 
This Guaranty Joinder Agreement may be executed in any number of
counterparts each of which when so executed and delivered shall be deemed an
original, and it shall not be necessary in making proof of this Guaranty
Joinder Agreement to produce or account for more than one such counterpart
executed by the Joining Guarantor. 
Without limiting the foregoing provisions of this Section 4, the
provisions of Section 10.02(b) of the Credit Agreement shall be
applicable to this Guaranty Joinder Agreement.

 

5.                                      Delivery.  Joining Guarantor hereby irrevocably waives
notice of acceptance of this Guaranty Joinder Agreement and acknowledges that
the Borrower’s Liabilities are and shall be deemed to be incurred, and credit
extensions under the Loan Documents made and maintained, in reliance on this
Guaranty Joinder Agreement and the Guarantor’s joinder as a party to the
Guaranty as herein provided.

 

6.                                      Governing
Law; Venue; Waiver of Jury Trial.  The provisions of Section
26 of the Guaranty are hereby incorporated by reference as if fully set
forth herein.

 

[Signature
page follows.]

 

 

IN WITNESS WHEREOF, the Joining Guarantor
has duly executed and delivered this Guaranty Joinder Agreement as of the day
and year first written above.

 

	
   

  	
  JOINING GUARANTOR:

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:EXHIBIT 4.1

 

SUBSCRIPTION AND REGISTRATION RIGHTS
AGREEMENT

 

 

Warren Resources, Inc.

489 Fifth Avenue, 32nd
Floor

New York, New York  10017

 

Gentlemen and Ladies:

 

The
undersigned desires to invest in Warren Resources, Inc. (the “Company”) on the
terms and conditions described in this Subscription And Registration Rights
Agreement (the “Subscription Agreement”) and the Company’s Confidential Private
Placement Memorandum dated January 21, 2004 (the “Memorandum”).  Pursuant to the terms described in the Memorandum
and in this Subscription Agreement, the Company is offering to subscribers who
are accredited investors up to 2,800,000 Units, with each Unit consisting of
one share of the Company’s common stock, par value $0.0001 per share (the
“Common Shares”), .25 Class A Warrants to purchase one Common Share at an
exercise price of $10.00 per share, and .25 Class B Warrants to purchase one
Common Share at an exercise price of $12.50 per share.  The Units are offered at the price of $7.00
per Unit (the “Offering Price”) for an aggregate of up to $19,600,000 (the
“Offering”).  The Class A Warrants and
Class B Warrants (collectively, the “Warrants”) will be exercisable during the
period beginning one year after the date of their issuance and ending five
years after the date of their issuance. 
The Warrants will terminate, if not exercised, five years from the date
of their issuance. The undersigned shall be entitled to registration rights for
the Common Shares, including the Common Shares issuable upon exercise of the
Warrants, as further described in this Subscription Agreement. In the event
that the Company’s Common Shares have not commenced public trading within one
year after the closing of the Offering, the Company shall issue an additional
..05 Class A Warrants and .05 Class B Warrants to the undersigned for each Unit
purchased in this Offering by the undersigned.

 

1.                                       Subscription

 

(a)                                  Subject
to and in accordance with the terms and conditions of this Subscription
Agreement, the undersigned hereby offers to purchase
                       
Units.  In accordance with the
Irrevocable Instruction Letter, incorporated herein as Exhibit A, the
undersigned shall deliver to the Company the full purchase price of
$                       
(the “Purchase Price”) for the subscription for the Units in the form of a
check or wire transfer to the Company. 
It is understood by the undersigned that the Company reserves the right
in its sole discretion to reject all or any part of any subscription.  After completion of the Offering, the
undersigned will be notified promptly by the Company whether the undersigned’s
subscription has been accepted.

 

(b)  As more fully described in each of the
undersigned’s Warrant Agreements, the exercise price of each Warrant and the
number of Common Shares issuable upon the exercise of a Warrant is subject to
adjustment in the event of: (i) any subdivision or combination of the Company’s
outstanding common stock; or (ii) any distribution by the Company to holders of
common stock of a stock dividend, or assets (other than cash dividends payable
out of retained earnings).

 

2.                                       Representations
And Warranties Of The Undersigned

 

The
undersigned hereby represents and warrants to, and agrees with, the Company as
follows:

 

 

(i)                                     the
undersigned can bear the economic risk of losing the undersigned’s entire
investment;

 

(ii)                                  the
undersigned is acquiring the Units for its own account and not with a view to,
or for resale in connection with, a distribution of the Units, or of the Common
Shares or Warrants included in the Units, in violation of the Securities Act of
1933 (the “1933 Act”);

 

(iii)                               the undersigned’s
overall commitments to investments that are not readily marketable is not
disproportionate to the undersigned’s net worth and the undersigned’s
investment in the Units will not cause such overall commitments to become
excessive;

 

(iv)                              the
undersigned’s financial condition is such that the undersigned is under no
present or contemplated future need to dispose of any portion of the Units to
satisfy any existing or contemplated undertaking, need or indebtedness;

 

(v)                                 the
undersigned has adequate means of providing for the undersigned’s current needs
and personal contingencies and has no need for liquidity in the undersigned’s
investment in the Units; and

 

(vi)                              the
undersigned has sufficient knowledge and experience in business and financial
matters to evaluate, and has evaluated, the merits and risks of this
investment.

 

(b)                                 The
address set forth below on the signature page of this Subscription Agreement is
the undersigned’s true and correct principal office, and the undersigned has no
present intention of relocating its principal office to any other state or
jurisdiction.

 

(c)                                  The undersigned is an “accredited investor” as
that term is defined in Rule 501 of Regulation D, as promulgated under the
1933 Act because the undersigned meets one
of the following criteria (if the undersigned is not an “accredited
investor”, place an “X” in the following blank:
          ):

 

(i)                                     An
individual with a net worth, individually or jointly with the undersigned’s
spouse, of $1,000,000; or

 

(ii)                                  An
individual with income in excess of $200,000 in each of the two most recent
years, or joint income with the undersigned’s spouse in excess of $300,000 in
each of those years, and the undersigned has a reasonable expectation of
reaching the same income level in the current year; or

 

(iii)                               An individual who is an
officer or director of the Company; or

 

(iv)                              A
corporation, Massachusetts or similar business trust, or partnership, not
formed for the specific purpose of acquiring the securities offered, with total
assets in excess of $5,000,000; or

 

(v)                                 A
trust with total assets in excess of $5,000,000 not formed for the specific
purpose of acquiring the securities offered, whose purchase is directed by a
sophisticated person as described in Rule 506(b)(2)(ii) of Regulation D, as
promulgated under the 1933 Act; or

 

2

 

(vi)                              An
entity in which all of the equity owners are accredited investors.

 

(d)                                 The undersigned confirms that all documents, records
and books pertaining to an investment in the Units that have been requested by
the undersigned have been made available or delivered to the undersigned.  Without limiting the foregoing, the
undersigned has received and reviewed the Memorandum together with the
following documents:  (a) Summary of
Evaluation of Proved Oil and Gas Reserves effective December 31, 2002
utilizing December 31, 2002 pricing, as prepared by Williamson Petroleum
Consultants, Inc; (b) the Company’s Annual Report on Form 10-K for the fiscal
year ended December 31, 2002; (c) the Company’s Quarterly Reports on Forms
10-Q for each of the quarters ended March 31, 2003, June 30, 2003 and
September 30, 2003; (d) the Company’s Proxy Statement on Schedule 14A
relating to the Company’s Annual Meeting of Shareholders on May 21,
2003;  and (e) any other documents
included with the Memorandum, and the undersigned has had the opportunity to
discuss the acquisition of the Units with the Company.  The undersigned has obtained or been given
access to all information concerning the Company that the undersigned has
requested.  As a result of its review of
the Company, including the review of the materials provided to the undersigned,
the undersigned understands, among other things, the following:  the Company has limited financial resources,
has had periods when it has incurred negative cash flow, and has had periods
when it has not operated at a profit; and the Company has not concurrently, and
may not in the future, receive additional investment funds.  The undersigned further represents that the
undersigned is cognizant of the operations, financial condition and
capitalization of the Company; is cognizant of the intended use of proceeds
from this financing, and has available full information concerning the
Company’s affairs to evaluate the merits and risks of an investment in the
Units.

 

(e)                                  The
undersigned has had the opportunity to ask questions of, and receive answers
from, the Company concerning the terms of an investment in the Units and to
receive additional information necessary to verify the accuracy of the
information delivered to the undersigned.

 

(f)                                    The
undersigned understands that the issuance of the Units has not been registered
under the 1933 Act or any state securities laws in reliance on an exemption for
private offerings and no U.S. federal or state agency has made any finding or
determination as to the fairness of this investment or any recommendation or
endorsement of the offering of the Units.

 

(g)                                 The
undersigned acknowledges that, in making the decision to purchase the Units, it
has relied solely upon independent investigations made by it.

 

(h)                                 The
undersigned has the full right, power and authority to enter into this
Subscription Agreement and to carry out and consummate the transactions
herein.  This Subscription Agreement
constitutes the legal, valid and binding obligation of the undersigned.

 

(i)                                     The
undersigned represents that an investment in the Units is a suitable investment
for the undersigned.

 

(j)                                     The
undersigned acknowledges and is aware that the following legend will be
imprinted on  the certificate(s)
representing the Common Shares and the Warrants subscribed to by the
undersigned (including those Common Shares exercisable upon exercise of the
Warrants):

 

3

 

“THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED WITH THE
UNITED STATES SECURITIES AND EXCHANGE COMMISSION UNDER THE U.S. SECURITIES ACT
OF 1933, AS AMENDED (THE “1933 ACT”), AND ARE ‘RESTRICTED SECURITIES’ AS THAT
TERM IS DEFINED IN RULE 144 UNDER THE 1933 ACT.  THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD OR
OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE 1933 ACT, OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
1933 ACT.”

 

(k)                                  The undersigned acknowledges and is aware of the
following, in addition to other information included in the information
provided to the undersigned:

 

(i)                                     The
Units and the securities included in the Units constitute a speculative
investment and involve a high degree of risk of loss by the undersigned of the
undersigned’s total investment.

 

(ii)                                  There
are substantial restrictions on the transferability of the Units.  The Units, the Common Shares, the Warrants,
and the Common Shares issuable upon exercise of the Warrants cannot be
transferred, pledged, hypothecated, sold or otherwise disposed of unless they
are registered under the 1933 Act, or an exemption from such registration is
available and established to the satisfaction of the Company; except as
provided in Section 3 below, investors in the Offering have no rights to
require that any transfer of the Units be registered under the 1933 Act; there
is a limited public market for the Company’s common stock; and accordingly, the
undersigned may have to hold the Units indefinitely;  and it may not be possible for the undersigned to liquidate the
undersigned’s investment in the Company.

 

(l)                                     The undersigned understands and agrees that the
Company is relying upon the accuracy, completeness, and truth of the
undersigned’s representations, warranties, agreements, and certifications
contained in this Subscription Agreement, in determining the undersigned’s
suitability as an investor in the Company and in establishing compliance with
federal and state securities laws.  The
undersigned understands that any incomplete, inaccurate, or untruthful
response, or the breach of the undersigned’s representations, warranties,
agreements, or certifications may result in the undersigned or the Company, or
both, being in violation of federal or state securities laws, and any person,
including the Company, who suffers damage as a result may have a claim against
the undersigned for damages.  The undersigned
also acknowledges that the undersigned is indemnifying the Company and others
for any such losses in accordance with Section 5 of this Subscription
Agreement.

 

The foregoing representations and warranties are true
and accurate in all material respects as of the date hereof and shall survive
the delivery of the subscription amount and the completed Subscription
Agreement.

 

3.                                       Registration
Rights

 

The Common Shares
purchased in connection with the Offering and the Common Shares issuable upon
exercise of the Warrants issued in connection with the Offering constitute
“Registrable Shares”, which are entitled to the registration rights described
below.

 

(a)                                  At
any time after the earlier to occur of (i) 170 days after the closing of the
initial public offering of the Company’s common stock, and (ii) one year after
the closing of this private placement

 

4

 

Offering, the Company
shall, as soon as practicable thereafter, file with the SEC a registration
statement covering the sale by the undersigned of the Registrable Shares
purchased in this Offering by the undersigned. 
The Company will undertake reasonable best efforts to cause the
registration statement to become effective with the SEC as soon as possible
after its filing.  Notwithstanding the
foregoing, the Company shall not be obligated to effect more than one
registration under this Section 3.

 

(b)                                 The
Company’s obligations contained in this Section 3 shall be conditioned
upon timely receipt by the Company in writing of such information as the
Company reasonably may require from the undersigned to be included in the
registration statement.  Such
information shall be provided to the Company in writing within 10 days after
the request for that information by the Company.

 

(c)                                  All
registration expenses incurred by the Company in connection with any
registration, qualification or compliance pursuant to this Section 3,
including printing expenses, fees and disbursements of the Company’s counsel,
and registration and filing fees relating to the sale of the Registrable Shares
to be registered on behalf of the undersigned pursuant to this Section 3,
shall be borne by the Company.  All
selling expenses, including commissions, allocable to the sale of the
Registrable Shares registered on behalf of the undersigned and all costs of the
undersigned’s legal counsel and other advisors shall be borne by the
undersigned.

 

(d)                                 In
the case of a registration effected by the Company on behalf of the undersigned
pursuant to this Section 3, the Company shall keep the undersigned advised
in writing as to the initiation of such registration and as to the completion
thereof.  At its expense, the Company
will keep such registration continuously effective for a period ending on the
earlier to occur of the date: (i) that is two years after the date on which the
registration statement becomes effective with the SEC;  (ii) on which the undersigned is eligible to
sell the Registrable Shares pursuant to Rule 144(k) under the Securities Act,
or the successor to such provision; or (iii) on which the undersigned has
completed the distribution described in the registration statement relating
thereto.

 

(e)                                  The
Company has previously existing registration rights obligations to holders (the
“Preferred Holders”) of its 8% Cumulative Convertible Preferred Stock (the
“Preferred Stock”) which require the following limitations on the registration
rights granted hereunder to the undersigned:

 

(i)                                     Commencing
six months after the completion of an initial public offering by the Company,
the Preferred Holders may request a registration statement covering all or any
portion of the Common Stock received or receivable upon exercise of the
Preferred Stock (the “Converted Shares”). 
No securities other than the Converted Shares may be included in this
registration statement without the prior written consent of a majority of the
Preferred Holders that requested the registration statement.  In addition, from the date of filing of such
registration statement and until the withdrawal or abandonment, or until 90
days after the effective date, of that registration statement, the Company
cannot file or cause to be effected any other registration of any of its equity
securities.

 

(ii)                                  Commencing
six months after the completion of an initial public offering by the Company,
the Preferred Holders of at least 50 percent of the Preferred Stock may request
and obtain piggyback rights for Converted Shares on a registration statement
filed by the Company.  If this
registration statement is an underwritten secondary registration, and the
managing underwriters advise the Company in writing of their opinion that the
number of securities requested to be included in that registration exceeds the
number that can be sold in an orderly manner in that offering within a price
range acceptable to the Company and the holders of a

 

5

 

majority of the Converted
Shares requested to be included in such registration, the Company shall include
in such registration the Preferred Stock requested to be included and the
Registrable Shares acquired in this Offering, pro rata among the holders of all
such securities on the basis of the number of securities owned by each such
holder.

 

(f)                                    In
the case of a registration effected by the Company on behalf of the undersigned
pursuant to this Section 3, the Company shall use its best efforts to
register and qualify the securities covered by such registration statement
under such other securities or blue sky laws of such jurisdictions within the
United States as the undersigned may reasonably request that allow registration
by coordination and to do any and all other acts and things which may be
necessary or advisable to enable the undersigned to complete such proposed sale
or other distribution by the undersigned of Registrable Shares in any such
jurisdiction; provided however, that in no event shall the Company be obligated
to register or qualify under the blue sky laws of any state in which the common
stock of the Company currently is not qualified for resale, or be obligated to
register or qualify the securities in any jurisdiction which would require the
Company to qualify to do business or to file a general consent to service of
process in any jurisdiction where it shall not then be qualified.

 

(g)                                 The
Company shall prepare and file with the SEC such amendments and supplements to
the registration statement and the prospectus used in connection therewith as
may be necessary to comply with the provisions of the 1933 Act with respect to
the disposition of all Registrable Shares; shall furnish to the undersigned
such number of copies of a prospectus, including a preliminary prospectus, in
conformity with the requirements of the 1933 Act, and such other documents
(including, without limitation, prospectus amendments and supplements as are
prepared by the Company) as the undersigned may reasonably request in order to
facilitate the disposition of the Registrable Shares; shall notify the
undersigned, at any time when a prospectus relating to such registration
statement is required to be delivered under the 1933 Act;shall immediately
notify the undersigned of the happening of any event as a result of which the
prospectus included in or relating to such registration statement contains an
untrue statement of a material fact or omits any fact necessary to make the
statements therein not misleading; and, thereafter, the Company will promptly
prepare (and, when completed, give notice to the undersigned) a supplement or
amendment to such prospectus so that, as thereafter delivered to the purchasers
of such Registrable Shares, such prospectus will not contain an untrue
statement of a material fact or omit to state any fact necessary to make the
statements therein not misleading; provided that upon such notification
by the Company, the undersigned will not offer or sell Registrable Shares under
the registration statement until the Company has notified the undersigned that
it has prepared a supplement or amendment to such prospectus and delivered copies
of such supplement or amendment to the undersigned (it being understood and
agreed by the Company that the foregoing proviso shall in no way diminish or
otherwise impair the Company’s obligation to promptly prepare a prospectus
amendment or supplement as above provided and deliver copies of same as above
provided).

 

(h)                                 To
the fullest extent permitted by law, the Company will indemnify and hold
harmless the undersigned, each officer, director, fiduciary, employee, member,
general partner and limited partner (and affiliates thereof) of the
undersigned, each broker or other person acting on behalf of the undersigned
and each person, if any, who controls the undersigned within the meaning of the
1933 Act, against any loss, claim, damage or liability (or action in respect
thereof) to which the undersigned may become subject, under the 1933 Act, or
otherwise, insofar as any such loss, claim, damage or liability (or action in
respect thereof) is caused by any untrue statement or alleged untrue statement
of any material facts contained in the registration statement, any prospectus
contained in the registration statement, or any amendment or supplement
thereto, or arises out of or is based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to
make the statements made therein not misleading, or arises out of the failure
of any representations or warranties of the Company contained herein to be true

 

6

 

and correct and the
Company will reimburse on demand the undersigned, such broker or other person
acting on behalf of the undersigned or such officer, director, fiduciary,
employee, member, general partner, limited partner, affiliate or controlling
person for any legal or other expenses reasonably incurred by any of them in
connection with investigating or defending any such loss, claim, damage,
liability or action.  Notwithstanding
the foregoing provisions of this paragraph, the Company will not be liable in
any such case to the extent that any such loss, claim, damage, expense or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission so made in conformity with
information furnished by the undersigned or any agent or other representative
of the undersigned.  If the
indemnification provided for in this Section 3 from the indemnifying party
is applicable by its terms but unavailable to an indemnified party hereunder in
respect of any losses, claims, damages, liabilities or expenses referred to
therein, then the indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages, liabilities or expenses in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party and indemnified party in connection with the actions which resulted in
such losses, claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations.  The
relative faults of such indemnifying party and indemnified party shall be
determined by reference to, among other things, whether any action in question,
including any untrue or alleged untrue statement of a material fact or omission
or alleged omission to state a material fact, has been made by, or related to
information supplied by, such indemnifying party or indemnified party, and the
parties’ relative intent, knowledge, access to information and opportunity to
correct or prevent such action.

 

(i)                                     The
undersigned will indemnify and hold harmless the Company and any underwriter
(as defined in the 1933 Act) for the Company and each person, if any, who
controls the Company or such underwriter against any loss, claim, damage or
liability (or action in respect thereof) to which the Company or such
underwriter or controlling person may become subject, under the 1933 Act or
otherwise, insofar as any such loss, claim, damage or liability (or action in
respect thereof) is caused by any untrue statement or alleged untrue statement
or omission or alleged omission made in conformity with information furnished
by the undersigned or any agent or other representative of the undersigned or
other representative of the undersigned for use in the registration statement.

 

4.                                       Public Trading of Common Stock

 

If the
common stock of the Company has not commenced public trading within one year
after the closing of this private placement Offering, then the Company shall
issue an additional .05 Class A Warrants and an additional .05 Class B Warrants
to the undersigned for each Unit purchased in this Offering by the undersigned.

 

5.                                       Indemnification

 

Both
the Company and the undersigned acknowledge and understand the meaning and
legal consequences of the representations, warranties, agreements, and
certifications contained above, and the Company and the undersigned hereby
agree to indemnify and hold harmless the other party (including, without
limitation, its respective managers, officers, directors, representatives and
agents) from and against any and all loss, damage, or liability due to or
arising out of a breach of any representation, warranty, agreement, or
certification, or the inaccuracy of any statement, of the Company or the
undersigned, as the case may be, 
contained in this Subscription Agreement or any other document submitted
by the Company or the undersigned in connection with the undersigned’s
subscription for the Units.  The
foregoing notwithstanding, nothing in this Subscription Agreement, including
the representations, warranties, agreements and certifications contained above,
shall be deemed to constitute a waiver of any rights that the undersigned may
have under the 1933 Act and other federal and state securities laws.

 

7

 

6.                                       Miscellaneous

 

(a)                                  This
Subscription Agreement may be executed in one or more counterparts all of which
taken together shall constitute a single instrument.

 

(b)                                 This
Subscription Agreement shall be governed and construed as binding upon the
parties hereto, and their respective successors, and no other person shall have
any right or obligation hereunder.  This
subscription shall be irrevocable, and may not be assigned by the
undersigned.  Subject to the foregoing,
this Subscription Agreement shall be binding upon and inure to the benefit of
the heirs, executors, administrators, legal representatives, successors and
assigns of the undersigned.

 

(c)                                  This
Subscription Agreement constitutes the entire agreement between the undersigned
and the Company with respect to the subject matter of this Subscription
Agreement and supersedes all prior and contemporaneous agreements between the
undersigned and the Company with respect to the subject matter of this
Subscription Agreement.

 

(d)                                 This
Subscription Agreement will be construed and enforced in accordance with and
governed by the laws of the State of Delaware,
except for matters arising under the 1933 Act, without reference to principles
of conflicts of law.

 

With
such full understandings and acknowledgements, the undersigned does hereby
affirm the undersigned’s subscription to the purchase of the Units being
offered by the Company as described herein and in the Memorandum.  The undersigned does further acknowledge the
undersigned’s understandings of all the terms and provisions of this
Subscription Agreement and, upon acceptance of this Subscription Agreement by
the Company, agrees to be bound by all the terms and conditions of this
Subscription Agreement.

 

[continued on signature page]

 

8

 

SIGNATURE
PAGE

 

 

	
  Date:

  	
  February 3,
  2004

  	
   

  	
   

  
	
   

  	
   

  
	
  [legal
  name of client account]

  	
   

  
	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
  Printed Name of
  Entity

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Signature

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Printed Name and
  Title

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Address

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  City, State,
  Postal or Zip Code, Country

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Tax
  Identification Number

  	
   

  
	
   

  	
   

  
	
  STATE OF

  	
  )

  	
   

  
	
   

  	
  )

  	
  ss.

  
	
  COUNTY OF

  	
  )

  	
   

  
									

 

On this 3rd day of February, 2004, before
me personally
appeared                          ,
who being duly sworn by me, acknowledged that (s)he executed the foregoing
instrument in the name of said entity, that (s)he had the authority to execute
the same, and that (s)he executed the same as the act and deed of said entity
for the uses and purposes therein stated.

 

My commission expires:                    

 

 

	
   

  	
   

  	
   

  	
   

  
	
  Notary Public

  	
  Address

  

 

This subscription is accepted by Warren Resources,
Inc.  on this
            day of
                 ,
2004.

 

	
   

  	
  WARREN
  RESOURCES, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
							

 

9

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