Sample Business Contracts


Employment Agreement - Warren Resources Inc. and Timothy A. Larkin

Employment Forms

  • Employers can customize an employment agreement that states the salary, benefits, working hours and other important provisions for their new or existing employee.
  • Answer simple questions to build a contract with a consultant. Specify the services rendered, when payment is due, as well as IP rights.
  • Employers who compensate their sales employees based on commissions can prepare an agreement to reduce misunderstandings by specifying the base salary and how commissions are calculated.
  • Companies may offer their business executives a contract that is different from the one provided to their regular employees. Executive employment agreements may be more complex because the compensation structure may include a combination of salary and commissions, provide for bonuses based on sales, stock or other financial targets, and include non-compete, confidentiality and severance provisions.
  • Independent sales representatives offer companies the potential to increase the sale of products or services without the burden of increasing headcount. Both parties should understand how commissions are calculated, when commissions will be paid, as well as how the representative will treat confidential information from the company and whether the representative may also sell a competing line of products or services.
  • More Employment Agreements

                              EMPLOYMENT AGREEMENT


     EMPLOYMENT  AGREEMENT (this  "Agreement"),  dated as of January 1, 2001, by
and between Warren Resources,  Inc., a New York corporation (the "Company"), and
Timothy A. Larkin (the "Employee").

                              W I T N E S S E T H:


     WHEREAS,  the  Company  desires to employ the  Employee  upon the terms and
conditions set forth in this Agreement; and

     WHEREAS,  the Employee  desires to accept an offer of  employment  with the
Company upon the terms and conditions set forth herein;

     NOW,  THEREFORE,  in  consideration  of the  premises  and  the  respective
covenants and  agreements of the parties herein  contained,  and intending to be
legally bound hereby, the parties hereto agree as follows:

     1.  Employment.  The Company hereby agrees to employ the Employee,  and the
Employee  hereby  agrees to serve  the  Company,  on the  terms  and  conditions
hereinafter set forth in this Agreement.

     2. Term. This Agreement,  and the employment of the Employee by the Company
hereunder, will commence on the date hereof (the "Effective Date") and terminate
on June 30, 2004 (the "Initial  Term"),  subject to earlier  termination  as set
forth herein (the  "Employment  Period").  As used herein,  the term "Employment
Year" shall mean each consecutive twelve (12) month period during the Employment
Period commencing on the Effective Date, or the yearly anniversary  thereof,  as
the case may be.  Effective on the third  anniversary of the Effective Date (and
each anniversary of such date thereafter), the term of this Agreement as then in
effect shall be automatically extended for an additional one (1) year term after
the  Initial  Term  unless,  at least three (3) months  prior to such date,  the
Company or the Employee  shall give written notice to the other party that it or
he,  as the case  may be,  in its or his  sole  discretion,  does not wish to so
extend the term of this Agreement.

     3. Position and Duties. Subject to the provisions of this Section 3, during
the Employment Period, the Employee shall serve as the Senior Vice-President and
Chief Financial  Officer of the Company and shall faithfully  perform the duties
and  responsibilities  normally  associated with such positions,  subject to the
oversight and direction of the Chief Executive Officer of the Company.

     4. Place of Employment. Generally, the Employee will fulfill all duties and
responsibilities  to the Company as set forth herein from the current  principal
place of business of the Company,  located at 489 Fifth  Avenue,  New York,  New
York, or any other location within thirty (30) miles of midtown  Manhattan,  New
York, New York, to which the principal place of business may be relocated.


<PAGE>

     5. Best Efforts.  The Employee's  employment with the Company shall be full
time and the  Employee  shall  devote his best  efforts and full  business  time
exclusively to the performance of his duties and  responsibilities  as set forth
in  this  Agreement,  which  duties  and  responsibilities  shall  be  performed
competently, carefully and faithfully. The Employee shall not, while an employee
of the Company and without the prior written  consent of the Company,  engage in
any other gainful  occupation or activity which  conflicts with or impinges upon
the full  and  faithful  performance  of the  Employee's  duties,  or  otherwise
violates  any  other  term or  provision  of  this  Agreement.  It is  expressly
understood and agreed,  however, that the provisions of this Section 5 shall not
be  construed  to prevent the  Employee  from  investing  or trading for his own
account or pursuing  charitable,  personal or civic activities;  provided,  that
such  activities do not impair the performance by the Employee of his duties and
responsibilities   hereunder,   or  otherwise  violate  any  provision  of  this
Agreement.

     6. The Employee's Compensation.

     (a) Salary.  During the  Employment  Period,  the Company  shall pay to the
Employee an annual base salary of $185,000.00 (as adjusted pursuant to the terms
hereof,  the "Base  Compensation").  The Base Compensation shall be increased on
each  anniversary  date of this Agreement by any increases in the cost of living
based on the changes in the  "Consumer  Price Index" as  published  from time to
time by the U.S. Department of Commerce for the New York City metropolitan area.
The Base Compensation will be paid to the Employee in accordance with the normal
payroll  practices of the Company in effect from time to time, less all required
withholdings for benefits, federal, state and local taxes, if any. The amount of
the Base  Compensation  may, in the  Company's  discretion,  be increased by the
Company on an annual basis during the  Employment  Period.  All increases to the
Base  Compensation,  if any,  shall be based on the  condition of the  Company's
business  and  results  of  operations  and  the  Company's  evaluation  of  the
Employee's individual performance for the relevant period. Any increases made to
the Base Compensation shall be in the discretion of the Company.

     (b) Bonus  Compensation.  In addition to the Base Compensation to which the
Employee is entitled  under Section 6(a),  the Employee  shall be eligible to be
awarded bonus  compensation  in accordance  with past business  practices of the
Company (the "Bonus  Compensation")  with respect to each fiscal year or portion
thereof during which the Employee was employed by the Company hereunder equal to
up to and including 100% of the  Employee's  Base  Compensation.  The amount and
time for  payment  of the  Bonus  Compensation  for any year,  if any,  shall be
determined by the Board of Directors in its discretion;  provided, however, that
under no event shall Employee be paid annual Bonus Compensation of less than 50%
of the Employee's Base Compensation on each anniversary date of this Agreement.

     (c) Options.  Employee  shall be entitled to  participate  in the Company's
Equity Incentive Plan (the "Equity Incentive Plan"), and will be awarded 676,875
options thereunder, exercisable at the price of $10.00 per share of common stock
for a period  ending  five  years  after  the date of grant of the  option  (the
"Options").  The  Options  shall  immediately  vest and be subject to  immediate

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<PAGE>

exercise on the date hereof.  The grant of such Options shall be documented with
a formal award letter from the Company to the Employee  setting  forth the terms
and conditions of Employee's Options.

     7. The  Employee's  Benefits.  As an employee of the Company,  the Employee
shall be  entitled  to  receive  and enjoy the  following  benefits  during  the
Employment Period:

     (a)  Participation in Company Benefit Plans. The Employee shall be entitled
to  participate  in  and to  receive  benefits  generally  available  to  senior
executives under those certain employee benefit plans and arrangements which may
be offered  by the  Company  from time to time  during  the  Employment  Period,
subject to and on a basis  consistent  with the terms,  conditions  and  overall
administration of such plans and arrangements by the Company.  The Company shall
provide full  medical,  hospitalization  and dental  insurance  coverage for the
Employee and his immediate family.

     (b)  Vacations.  The  Employee  shall be entitled to four (4) weeks of paid
vacation per  Employment  Year,  provided  that any vacations are to be taken at
times  mutually  agreeable to the Company and the  Employee.  In addition to the
foregoing,  the Employee shall be entitled to receive all paid holidays given by
the Company to its employees generally. If Employee has not used his accrued but
unused  vacation  days during an Employment  Year,  such days may not be carried
over to another  and shall be deemed  waived by the  Employee.  Any  accrued but
unused  vacation  days in an  Employment  Year  shall be  reimbursed  in cash to
Employee upon a termination of his employment Without Cause hereunder.

     (c) Business Expense Reimbursement. The Company shall promptly reimburse or
pay the Employee for all  reasonable  and  necessary  business  expenses paid or
incurred  by  the  Employee  in  performing  his  duties  and   responsibilities
hereunder; provided, that, the Employee shall have (i) submitted such reasonable
documentation  as may be  requested  by  the  Company  in  accordance  with  the
reimbursement  policies  of the  Company  in  effect  from time to time and (ii)
obtained the prior approval of the Company for all charges in excess of $20,000.

     (d) Life  Insurance.  The Company shall provide term life  insurance in the
amount of $500,000 on the life of Employee,  with  Employee's  spouse,  or other
Employee designee, as the named beneficiary; and

     (e) Disability  Insurance.  The Company shall provide disability  insurance
paying  benefits  to Employee of not less than  $200,000  per annum  (subject to
availability).

     8.  Termination of Employment.  The Employee's  employment with the Company
may be terminated as follows:

     (a)  With  Cause.  The  Employee's  employment  with  the  Company  may  be
terminated  by the  Company at any time for  "Cause." As used  herein,  the term
"Cause"  shall  refer to the  following:  (i) theft,  fraud,  dishonesty,  gross

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<PAGE>

negligence  or  willful  malfeasance  by the  Employee  in  connection  with the
performance  of his duties  hereunder  (collectively,  "Theft  Events");  (ii) a
material  breach or  failure  to  fulfill  and  perform  the  Employee's  duties
hereunder,  which breach or failure is not cured to the reasonable  satisfaction
of the Company within forty-five (45) days after written demand from the Company
(if  such  breach  is  at  all  curable  during  such  time  in  the  reasonable
determination  of the Company;  failing such  determination,  "Cause" shall have
occurred upon the occurrence of such breach or failure);  (iii)  conviction of a
felony or a crime involving moral turpitude;  (iv) habitual neglect of duties or
misconduct in the  performance  of the  Employee's  duties and  responsibilities
hereunder  following an initial  notice of warning from the Company with respect
thereto;  or (v) a repeated  or ongoing  failure to comply  with the  reasonable
directions and  instructions of management of the Company in connection with the
performance of the Employee's duties and responsibilities hereunder following an
initial  notice  of  warning  from  the  Company  with  respect  thereto.   Upon
termination  for Cause,  all rights of the Employee under this  Agreement  shall
immediately terminate and the Company shall have no further obligations, subject
to Section  8(f)(i) below. A termination of the Employee's  employment  with the
Company by the Employee upon his voluntary  resignation or voluntary  retirement
shall be treated as a termination for Cause hereunder.  In connection therewith,
the  Employee  covenants  and agrees not to  voluntarily  resign or  voluntarily
retire without  providing the Company with  forty-five  (45) days' prior written
notice.   Upon  a  termination  for  Cause,   Employee  shall  receive  in  full
satisfaction  of all amounts due to him an amount equal to the remainder of Base
Compensation  through date of termination due under his current Employment Year.
In addition, Employee shall receive any accrued but unpaid vacation time for the
current  Employment Year and Bonus Compensation equal to the amount paid for the
previous  Employment  Year,  prorated  for the  number of days of service in the
current Employment Year. Notwithstanding any of the foregoing, in the event that
the Company has  terminated  Employee's  employment on account of a Theft Event,
the Company  shall be entitled to  withhold  from any amounts  otherwise  due to
Employee under this Subsection 8(a) the amount of monetary  damages  incurred by
the Company from such Theft Event which shall be  quantified  and  determined in
writing  by the  Company  within  90 days  after  the date of  termination.  The
Employee agrees that his eligibility to receive any and all amounts described in
this  Section  8(a)  shall be  subject  to and  contingent  upon the  Employee's
execution of a full and complete general release in favor of the Company and its
affiliated  persons  and  entities,  satisfactory  to the  Company  in its  sole
discretion.

     (b)  Without  Cause.  The  Employee's  employment  with the  Company may be
terminated  by the Company at any time  without  Cause,  but in the event of any
such  termination  pursuant  to this  Section  8(b),  the  Company  will pay, in
addition to any other amounts due  hereunder,  the Employee  severance pay in an
amount  equal to the greater of (i) the balance of all of  Employee's  remaining
and unpaid  Base  Compensation  due for the  balance of the then  existing  term
hereunder,  or (ii)  Employee's  annual  Base  Compensation  multiplied  by two,
payable upon  execution and delivery of the release  described  below,  less all
required  withholdings and in accordance with then current payroll  practices of
the Company and  applicable  law or  regulation.  In  addition,  Employee  shall
receive any accrued but unpaid vacation time for the current Employment Year and
Bonus  Compensation  equal to the amount paid for the previous  Employment Year.
The  Employee  agrees  that  his  eligibility  to  receive  any and all  amounts

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<PAGE>

described  in this  Section  8(b) shall be subject  to and  contingent  upon the
Employee's  execution  of a full and  complete  general  release in favor of the
Company and its affiliated persons and entities,  satisfactory to the Company in
its sole discretion.

     (c)  Termination  for  Death  or  Disability.   The  Employee's  employment
hereunder shall terminate  immediately  upon the Employee's death or Disability.
For purposes of the preceding  sentence,  the term  "Disability"  shall mean the
Employee's inability,  by reason of physical or mental incapacity (determined by
a licensed physician reasonably  acceptable to the Employee and the Company), to
perform  the  essential  functions  of his job,  with or  without  a  reasonable
accommodation  by the Company,  for an aggregate of one hundred and twenty (120)
days during any twelve (12) month period,  provided further that during any such
continuous period,  the Employee's Base Compensation  payable under Section 6(a)
shall be reduced by the amount,  if any, of payments to the  Employee  under any
short-term or long-term  disability insurance policy, plan or program maintained
by the Company.  During any period when the Employee  implicitly  or  explicitly
purports to be unable to perform his duties  hereunder  by reason of physical or
mental  illness,  incapacity or  disability,  the  Employee,  at the request and
expense of Company,  shall submit to one or more  examinations by a physician of
the  Company's  choice.  A termination  of the  Employee's  employment  with the
Company due to any of the  foregoing  provisions  of this  Section 8(c) shall be
treated as a termination without Cause hereunder.

     (d) Termination by Employee for Good Reason.  Employee shall have the right
to terminate this Agreement for "Good Reason".  The following  events  affecting
Employee shall  constitute  "Good Reason" within the meaning of this  Agreement:
(i) if  Employee,  at any time during the  Employment  Period  (except  during a
period of  Disability),  has suffered a material  change or diminution in duties
and  responsibilities  from those contemplated herein, (ii) if there is a Change
of Control Event,  as defined below,  or (iii) if Employee shall be relocated by
the  Company or a  successor  thereto to a location  more than thirty (30) miles
outside midtown Manhattan, New York, New York.

     For purposes of this Employment Agreement, a "Change of Control" shall mean
the happening of any of the following:

          (i) the  acquisition  by any  person  or group  deemed a person  under
     Sections  3(a)(9) and 13(d)(3) of the Securities  Exchange Act of 1934 (the
     "Exchange Act") (other than the Company and its  subsidiaries as determined
     immediately  prior  to that  date) of  beneficial  ownership,  directly  or
     indirectly (with beneficial ownership determined as provided in Rule 13d-3,
     or any successor rule,  under the Exchange Act), of a majority of the total
     combined  voting  power of all classes of stock of the  Company  having the
     right under ordinary  circumstances  to vote at an election of the Board of
     Directors of the Company, if such person or group deemed a person was not a
     beneficial  owner of at least  five  percent  (5%) of such  total  combined
     voting power of the Company on the date of this Agreement;

          (ii) the  election to the Board of Directors of the Company of members
     as a result of which a majority of the Board of Directors  shall consist of

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<PAGE>

     persons who are not members of the Board of  Directors as of the Start Date
     (including  Employee as a member of the Board of  Directors as of the Start
     Date),  except in the event that such slate of Directors is proposed by the
     management of the Company;

          (iii) the date of  approval by the  stockholders  of the Company of an
     agreement  providing  for the merger or  consolidation  of the Company with
     another  corporation or other entity where (x)  stockholders of the Company
     immediately  prior to such merger or  consolidation  would not beneficially
     own  following  such  merger  or   consolidation   shares   entitling  such
     stockholders  to 50% or more of all  votes  (without  consolidation  of the
     rights of any class of stock to elect  directors by a separate  class vote)
     to which all stockholders of the surviving corporation would be entitled in
     the  election  of  directors,  or (y)  where  the  members  of the Board of
     Directors,  immediately prior to such merger or  consolidation,  would not,
     immediately  after such merger or  consolidation,  constitute a majority of
     the board of directors of the surviving corporation; or

          (iv)  the  sale  of all or  substantially  all  of the  assets  of the
     Company.

     (e) Status upon  Termination.  The termination of this  Agreement,  and the
Employee's employment hereunder,  for any reason whatsoever shall constitute the
Employee's  effective  termination and  resignation  from any other positions or
duties with the Company and all of its affiliates.

     (f) Effect of Termination.

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

          (ii)  In the  event  of a  termination  of the  Employee's  employment
     without Cause  pursuant to Section  8(b), or under 8(c) or 8(d) above,  the
     Company shall also pay the Employee  severance  compensation  in accordance
     with Section 8(b) above. Furthermore, if the Employee is terminated without
     Cause,  or the  employment  ceases under Section 8(c) or 8(d), all unvested
     options granted to the Employee pursuant to the Equity Incentive Plan shall
     be kept in effect,  or, at the Employee's option, the Company must purchase
     all vested and  unvested  options at an amount  equal to the greater of (a)
     the  exercise  price,  or (b) the Fair Market Value of the common stock for
     which such  options  may be  exercised  as of the date of such  termination
     reduced by the exercise price, as the case may be.

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

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          (iv) "Fair Market Value" shall be the weighted  average  closing "ask"
     price for the  Company's  publicly  traded  common  stock  for the  fifteen
     trading days immediately preceding the termination date; provided, however,
     that if the Company's common stock is not publicly traded,  the price shall
     be based upon the price per share  paid by third  party  investors  for the
     Company's Common Stock in a private placement of at least $1,000,000 of the
     Company's Common Stock most recently before the date of termination.

     9. Noncompetition and Confidentiality.

     (a)  Noncompetition.  During the  Employment  Period  and, in the case of a
termination  of the  Employee's  employment  for Cause,  for a period of six (6)
months  following the date of termination  of  employment,  or, in the case of a
termination of the Employee's  employment without Cause, for a period of one day
following the date of  termination  of employment  (the "Covered  Period"),  the
Employee agrees not to engage in any  Competitive  Activity within the States of
New York, New Mexico,  Texas and Wyoming.  As used herein, the term "Competitive
Activity" shall mean the following:  (i) providing competitive  services,  other
than on behalf of the Company,  to any Customer (as defined below); (ii) serving
as an officer, director, employee, consultant,  advisor, agent or representative
of,  or  otherwise   associating   in  any  other  capacity  with,  any  person,
corporation,   partnership,  limited  liability  company,  sole  proprietorship,
association or other business enterprise, other than the Company, engaged in the
business  of oil and gas  exploration,  drilling  and  production  or any  other
business in which the Company is engaged (each, a "Competitive Enterprise"),  or
engaging individually in any Competitive Enterprise;  (iii) owning or acquiring,
directly or indirectly,  any interest in any Competitive  Enterprise  (provided,
however, the Employee shall be allowed to passively own for investment purposes,
directly  or  indirectly,  no more  than ten  percent  (10%) of the  issued  and
outstanding  publicly  traded  securities of any issuer engaged in a Competitive
Enterprise);  (iv)  soliciting  or inducing  any partner,  stockholder,  member,
principal,   director,   officer,   employee,   consultant,   agent   or   other
representative  of the Company or one or more  affiliates to leave the employ or
retention of the Company or such  affiliate or hiring away any of the  foregoing
persons;  and/or  (v)  encouraging,   requesting  or  advising,   explicitly  or
implicitly,  any  Customer  or  supplier  of the  Company  or one or more of its
affiliates to withdraw,  curtail or cancel its business  relationships  with the
Company or any affiliate  thereof  (unless  expressly  requested to do so by the
Company as part of the Employee's employment services provided hereunder).

     As used in this Section 9, the term "Customer" shall include any person who
is or was a customer of the Company or an  affiliate  thereof at any time during
the period  commencing with the Employment Period through the end of the Covered
Period.

     (b) Confidentiality.  During the Employment Period and for a period of five
(5) years  thereafter,  the  Employee  shall  not,  except as may  otherwise  be
required by law, directly or indirectly disclose to any person or entity, or use

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or cause to be used in any manner adverse to the interests of the Company or any
affiliate  thereof,  any  Confidential  Information  (as  defined  below in this
Section 9(b)).  The Employee agrees that, upon the termination of his employment
with the Company for any reason, all Confidential Information (other than a copy
of this Agreement and any other agreements that have been personally executed by
the  Employee  other than in his  capacity  as an officer  of the  Company)  and
duplicates thereof in the possession or control of the Employee,  in any form or
format,  including,  without limitation,  written,  visual, audio, electronic or
magnetic  formats,  shall  forthwith be returned to the Company and shall not be
retained by the Employee or furnished or  communicated to any third party in any
form whatsoever.

     As used in this Section 9(b),  the term  "Confidential  Information"  shall
mean the following:  (i)  information  disclosed to the Employee or known by the
Employee as a consequence of the Employee's relationship with the Company or any
Affiliate  thereof,  as defined  below,  not  generally  known in the  Company's
business, about the Company's or an Affiliate's employees, customers, directors,
officers, partners, shareholders, advertising methods, public relations methods,
business plans, operations, methods, processes and forecasts, vendors, finances,
trade marks, trade secrets, source code, patent applications,  manuals, designs,
technical  specifications  and other  intellectual  property;  (ii)  information
disclosed  to the  Employee  or known by the  Employee as a  consequence  of the
Employee's relationship with the Company or any Affiliate thereof, not generally
known in the  businesses in which the customers of the Company or its affiliates
are or  may  be  engaged,  about  the  products,  processes,  operations,  trade
information and services of any such customer; or (iii) information disclosed to
the  Employee  by the  Company  or  any of its  affiliate  which  is  marked  as
"confidential"  or,  if  communicated   verbally,  is  followed  up  by  written
correspondence  designating such information as "confidential."  Affiliate shall
mean any person or entity  that  directly,  or  indirectly,  through one or more
intermediaries,  controls, or is controlled by, or is under common control with,
the Company.

     (c) Severability.  The invalidity or  nonenforceability of any provision of
this Section 9 in any respect shall not affect the validity or enforceability of
the other  provisions  of this Section 9 in any other  respect,  or of any other
provision of this  Agreement.  In the event that any provision of this Section 9
shall be held invalid or unenforceable  by a court of competent  jurisdiction by
reason of the  geographic or business  scope or the duration  thereof or for any
other  reason,  such  invalidity  or  unenforceability  shall attach only to the
particular  aspects of such provision found invalid or  unenforceable as applied
and shall not affect or render invalid or  unenforceable  any other provision of
this Section 9 or the enforcement of such provision in other circumstances,  and
this Section 9 shall be construed as if the  geographic or business scope or the
duration  of such  provision  or other  basis on which such  provision  has been
challenged  had  been  more  narrowly  drafted  so  as  not  to  be  invalid  or
unenforceable.

     10.  Business  Opportunities.  During the Employment  Period,  the Employee
agrees  to bring  all  business  opportunities  to the  Company  relating  to or
otherwise  associated  with the  business or  businesses  then  conducted by the
Company or each  affiliate  thereof,  or business or  businesses  proposed to be
conducted by the Company.

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     11. Rights to Work Product.  The Employee agrees that all work performed by
the Employee  pursuant  hereto shall be the sole and  exclusive  property of the
Company,  in whatever stage of  development  or completion.  With respect to any
copyrightable  works  prepared in whole or in part by the  Employee  pursuant to
this  Agreement,  including  compilations  of lists or data, the Employee agrees
that all such works will be  prepared as  "work-for-hire"  within the meaning of
the Copyright Act of 1976, as amended (the "Act"), of which the Company shall be
considered the "author"  within the meaning of the Act. In the event (and to the
extent)  that such works or any part or element  thereof is found as a matter of
law not to be a  "work-for-hire"  within the  meaning of the Act,  the  Employee
hereby assigns to the Company the sole and exclusive  right,  title and interest
in and to all  such  works,  and all  copies  of any of  them,  without  further
consideration,  and agrees, to the extent reasonable under the circumstances, to
cooperate  with the Company to register,  and from time to time to enforce,  all
patents,  copyrights and other rights and protections  relating to such works in
any and all countries.  To that end, the Employee  agrees to execute and deliver
all documents requested by the Company in connection therewith, and the Employee
hereby  irrevocably  designates and appoints the Company as the Employee's agent
and  attorney-in-fact  to act  for  and on  behalf  of the  Employee  and in the
Employee's stead to execute, register and file any such applications,  and to do
all other lawfully  permitted acts to further the  registration,  protection and
issuance of patents, copyrights or similar protections with the same legal force
and effect as if  executed by the  Employee.  The Company  shall  reimburse  the
Employee for all reasonable costs and expenses incurred by the Employee pursuant
to this Section 11.

     12. No  Disparaging  Statements.  During the Term of employment and for one
(1) year after  termination  of this  Agreement for any reason  whatsoever,  the
Employee  and  the  Company  agree  to  refrain  from  making  any   disparaging
statements, either orally or in writing, about the other party (and, on the part
of the Employee, about any affiliate of the Company, or any directors, officers,
shareholders,  employees,  agents or other representatives of the Company or any
affiliate thereof).

     13.  Survival.  The provisions of Sections 8(b), 8(d), 8(e), 9, 11, 12, 14,
15, 16 and 17 hereof shall  survive the  termination  of this  Agreement for the
applicable  time period  necessary to fully  effectuate  the  provisions of such
sections.

     14.  Compliance  With Other  Agreements.  The Employee and the Company each
hereby  represent  and warrant to the other that the  execution  and delivery of
this Agreement and the  performance of such party's  obligations  hereunder will
not,  with or without  the  giving of notice  and/or  the  passage of time,  (i)
violate any  judgment,  writ,  injunction  or order of any court,  arbitrator or
governmental  agency  applicable to such party, or (ii) conflict with, result in
the breach of any  provision of or the  termination  of, or constitute a default
under, any agreement to which such party is a party or by which such party is or
may be bound.  The parties  agree to indemnify and hold harmless each other from
any liability,  judgment or claim  incurred,  entered or made against such party
based on its reliance on the representations and warranties made in this Section
14,  including  all costs and expenses and  attorney's  fees incurred or paid by
such party in connection with the foregoing.

                                       9
<PAGE>

     15.  Injunctive  Relief.  The  Employee  acknowledges  and agrees  that the
Company and its affiliates are engaged in a highly competitive business and that
the  protections of the Company and each such affiliate set forth in Sections 9,
10 and 11 of this  Agreement are fair and reasonable and are of vital concern to
the Company and its affiliates.  Further,  the Employee  acknowledges and agrees
that monetary  damages for any  violation of such  Sections will not  adequately
compensate  the Company and its affiliates  with respect to any such  violation.
Therefore,  in the  event of a breach  by the  Employee  of any of the terms and
provisions  contained  in  Sections  9, 10 or 11 hereof,  the  Company  shall be
entitled to institute legal  proceedings to enforce the specific  performance of
this  Agreement  by the  Employee  and to enjoin the  Employee  from any further
violations.  The remedies  available to the Company  pursuant to this Section 15
may be  exercised  cumulatively  by the  Company in  conjunction  with all other
rights and remedies provided by law.

     16.  Arbitration  Of  Disputes.  If any  dispute  shall  arise  between the
Employee and the Company in  connection  with this  Agreement,  and such dispute
cannot be resolved  amicably by the parties,  the same shall be conclusively and
finally  resolved  by  binding  arbitration.   Any  party  hereto  may  commence
arbitration proceeding by providing written notice to the other party requesting
the arbitration of an unresolved  dispute.  Each such dispute,  if any, shall be
submitted to three (3) arbitrators,  one (1) to be selected by the Employee, one
(1) to be selected by the Company and the third to be selected by  agreement  of
the two arbitrators chosen by the parties. If either the Employee or the Company
refuses or  neglects  to appoint an  arbitrator  within  thirty  (30) days after
receipt of written notice from the other party  requesting the other party to do
so, the American Arbitration Association may appoint two (2) arbitrators. If the
two  arbitrators  fail to agree on the  selection of a third  arbitrator  within
thirty  (30) days of their  appointment,  the  appointment  shall be left to the
American  Arbitration  Association.  The arbitrators shall be experienced in the
subject  matter of the  dispute.  Except  as  otherwise  specifically  set forth
herein,  the  arbitrators  shall conduct the  arbitration in accordance with the
Commercial  Arbitration  Rules  of the  American  Arbitration  Association.  The
decision  in writing  of any two (2)  arbitrators,  when filed with the  parties
hereto, shall be final and binding on both parties. Judgment may be entered upon
the final  decision of the  arbitrators in any court having  jurisdiction.  Such
arbitration  shall  take  place at a location  to be  mutually  agreed to by the
Employee and the Company;  provided,  however,  that if the Company and Employee
cannot agree on a location, the place shall be selected by the arbitrators.

     Notwithstanding  anything to the  contrary  contained  in this  Section 16,
nothing  shall  prohibit  the Company or Employee  from  pursuing  all legal and
equitable  remedies available to the Company or Employee in order to enforce the
provisions  of Sections 9, 10 and 11 of this  Agreement.  To the extent that any
court action is permitted  consistent  with or to enforce  this  Agreement,  the
parties  hereby  consent to the  jurisdiction  of the  federal  or state  courts
sitting in any state where the Company  maintains an office.  Accordingly,  with
respect to any such court  action,  all of the parties  hereto (a) submit to the
personal  jurisdiction of such courts, (b) consent to service of process and (c)
waive any other  requirement  (whether  imposed by  statute,  rule of court,  or
otherwise) with respect to personal jurisdiction or service of process.

                                       10
<PAGE>

     17.  Amendment;  Waiver;  Discharge.  No provision of this Agreement may be
amended,  waived or  discharged  unless such  amendment,  waiver or discharge is
agreed  to  in  writing  and  signed  by  the  Employee  and a  duly  authorized
representative  of the Company.  No waiver by either party hereto at any time of
any breach by the other party hereto of, or  compliance  with,  any condition or
provision of this  Agreement to be performed by such other party shall be deemed
a waiver of similar or dissimilar provisions or conditions at the same or at any
prior or subsequent time.

     18.  Validity.  The  invalidity  or  unenforceability  of any  provision or
provisions of this Agreement shall not affect the validity or  enforceability of
any other  provision  of this  Agreement,  which shall  remain in full force and
effect.

     19. Notices. All notices,  demands and other communications provided for in
this  Agreement  shall be in writing and shall be  delivered by hand or sent via
fax transmission (with written fax confirmation) or mailed postage prepaid or by
registered,  certified or express mail or reputable  overnight  courier service,
charges  prepaid,  and shall be deemed given when so delivered,  if delivered by
hand, or upon receipt of reasonably adequate fax confirmation,  if faxed, or, if
mailed,  five (5)  business  days after  mailing (or one (1) business day in the
case of express mail or overnight courier service), addressed as follows:


                  If to the Employee:

                  Timothy Larkin
                  14 Lafayette Drive
                  Cedar Grove, NJ 07009
                  (Tel.):  (973) 239-2216

                  If to the Company:

                  Warren Resources, Inc.
                  489 Fifth Avenue
                  32nd Floor
                  New York, NY 10016
                  Attention:  Chief Executive Officer
                  (Fax):  (212) 697-9466
                  (Tel.):  (212) 697-9660


or to such other address or person as any party may have  furnished to the other
in writing in  accordance  herewith,  except  that  notices of change of address
shall be effective only upon receipt.

     20.  Headings.  All headings  contained in this Agreement are for reference
purposes only and shall not in any way effect the meaning or  interpretation  of
any provision or provisions of this Agreement.

                                       11
<PAGE>

     21. Entire Agreement. This Agreement sets forth the entire agreement of the
parties hereto in respect of the subject matter  contained herein and supersedes
all  prior  agreements,  promises,  covenants,   understandings,   arrangements,
communications,  representations or warranties,  whether oral or written, by any
party or representative of any party hereto.

     22.  Assignment and Transfer.  The Employee's  rights and obligations under
this Agreement  shall not be  transferable  by assignment or otherwise,  and any
purported  assignment,  transfer  or  delegation  thereof  shall be  void.  This
Agreement shall inure to the benefit of, and be binding upon and enforceable by,
any  purchaser of  substantially  all of the  Company's  assets,  any  corporate
successor to the Company or any assignee thereof.

     23. Counterparts.  This Agreement may be executed in several  counterparts,
each of which shall be deemed to be an original but all of which  together  will
constitute one and the same instrument.

     24.   Governing  Law.  The  validity,   interpretation,   construction  and
performance of this Agreement  shall be governed by the laws of the State of New
York without regard to its conflicts of law principles.

                   [Signatures follow]


                                       12
<PAGE>





     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
and year first above written.

                                WARREN RESOURCES, INC.



                                By:    /s/ Norman F. Swanton
                                       -----------------------------------------
                                       Name:  Norman F. Swanton
                                       Title:   Chief Executive Officer



                                       /s/ Timothy A. Larkin
                                       -----------------------------------------
                                           Timothy A. Larkin









                                       13

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