THE CORPORATE LIBRARY

Related Party Transactions and Outside Related Director Information

Warrior Energy Services Corporation (WARR)

4/19/2006 424B4 Information

Offering by Selling Stockholders

Pursuant to a registration rights agreement among us and holders of our outstanding convertible notes and common stock purchase warrants entered into prior to this offering, the selling stockholders are selling 592,466 shares of common stock in this offering. We are paying the expenses of this offering by the selling stockholders, other than the underwriting discounts, commissions and transfer taxes with respect to shares of stock sold by the selling stockholders and the fees and expenses of any attorneys, accountants and other advisors separately retained by them.

Transactions with Officers, Directors and Significant Stockholders

Commencing in June 1997 through February, 1999, we entered into a series of transactions whereby we sold to the St. James Partnerships, $19.4 million principal amount of Convertible Notes and Warrants to purchase an aggregate of 3,032,028 shares of our common stock for an aggregate consideration of $19.4 million. The foregoing excludes an additional $3.0 million borrowed in June 1997 that was repaid in October 1997. Of these Convertible Notes and Warrants, $1.0 million of Convertible Notes and Warrants to purchase 180,000 shares of common stock were subsequently transferred by one of the St. James Partnerships in October 1998 to a person not affiliated with our company.

In December 1999 and February 2000, we sold to SJMB L.P., one of the St. James Partnerships, certain other non-affiliated investors, and Mr. Underbrink, who participated with the St. James Partnerships in the transaction, an additional $7.0 million principal amount of our Convertible Notes and 2,870,000 Warrants. The St. James Partnerships originally acquired in the transaction $750,000 principal amount of the $7.0 million of the Convertible Notes and 307,500 Warrants. Mr. Underbrink acquired in the transaction $750,000 principal amount of Convertible Notes and 307,500 Warrants.

On various dates subsequent to February 2000, the St. James Partnerships purchased from third parties an additional $1,200,000 principal amount of Convertible Notes and 369,000 Warrants.

Subsequent to its purchase of the Convertible Notes, on December 14, 2000, SJMB, L.P., one of the St. James Partnerships, converted $1,750,000 principal amount of a Convertible Note and $2,013,111 of accrued interest on a Convertible Note into 501,748 shares of our common stock at a conversion price of $7.50 per share.

During the years ended December 31, 2004 and 2003, $3.9 million and $3.7 million, respectively, of interest accrued on Convertible Notes owing by us to the St. James Partnerships. An additional $3.5 million of interest accrued during the year ended December 31, 2005. At December 31, 2005, the St. James Partnerships held an aggregate of $35,019,173 principal amount of and accrued interest on our Convertible Notes and 4,075,528 of our Warrants.

The Underbrink Family Entities held as of December 31, 2005, $1,677,375 principal amount of Convertible Notes. At December 31, 2005, the Underbrink Family Entities held an aggregate of $1,718,904 in total principal of and accrued interest on Convertible Notes which are convertible into an aggregate of 229,187 shares. On November 21, 2005, the Underbrink Family Entities converted $1,428,000 of accrued interest on Convertible Notes into 190,400 shares of our common stock at a conversion price of $7.50 per share. During the years ended December 31, 2005, 2004 and 2003, approximately $251,606 of interest accrued each year on the Convertible Notes owing by us to the Underbrink Family Entities.

In connection with and as a condition to entering into our Restated Credit Agreement with GECC in November 2004, the holders of $23.1 million principal amount of Convertible Notes, including all of the principal amount of Convertible Notes owing to the St. James Partnerships and to the Underbrink Family Entities, agreed with us to extend the maturity date of the Convertible Notes from December 31, 2004 to February 13 and February 14, 2008. In addition, in connection with entering into our Restated Credit Agreement with GECC, we repaid approximately $942,000 principal amount of the Convertible Notes. None of these payments were to the St. James Partnerships or to the Underbrink Family Entities. As a condition to extending the maturity date of the notes, we extended to December 31, 2009 the expiration date of 6,605,119 Warrants, including the 4,075,528 Warrants held by the St. James Partnerships and 1,057,091 Warrants held by the Underbrink Family Entities.

In September 2001, August 2004 and November 2004 an aggregate of $1,647,625 of the aggregate principal balance of Convertible Notes was repaid, leaving a remaining aggregate principal balance of $5,352,375 on the $7.0 million of Convertible Notes issued between December 1999 and February 2000 which principal amount is convertible into an aggregate of 713,650 shares of common stock. None of these payments were to the St. James Partnerships or to the Underbrink Family Entities.

On October 6, 2005, in connection with the Recapitalization, we entered into Recapitalization Agreements (the "Recapitalization Agreements") with each of the St. James Partnerships, who held, as of December 31, 2005, an aggregate of $35,019,173 principal amount of and accrued interest on our Convertible Notes, 4,075,528 Warrants and 501,748 shares of common stock, and with the Underbrink Family Entities, who held, as of December 31, 2005, an aggregate of $1,718,904 principal amount of and accrued interest on our Convertible Notes, and 602,347 shares of common stock.

The Recapitalization Agreements with the St. James Partnerships and the Underbrink Family Entities provide that such entities will convert, at the conversion price of $7.50 per share, the principal of and all accrued interest on their Convertible Notes into shares of our common stock (the "Conversion Shares") and sell to us those Conversion Shares at the closing of this offering. The price at which the shares are to be purchased by us is the price per share equal to the net price per share we receive in this offering, after deducting underwriting discounts and the underwriters' expenses and fees, provided the agreement of the St. James Partnerships and the Underbrink Family Entities to sell the shares is subject to the net price per share to be received by them for each Conversion Share being not less than $7.50 per share (subject to adjustment for stock splits, divisions, reverse stock splits or share combinations). In addition, the shares that the St. James Partnerships agreed to sell to us include 501,748 shares of common stock held by SJMB, L.P.

In the Recapitalization Agreement between us and the Underbrink Family Entities, the Underbrink Family Entities exchanged, effective October 6, 2005, their 1,193,841 Warrants for 397,948 shares of common stock (the "Exchange Shares"). The Underbrink Family Entities further agreed to sell to us at the closing of this offering their Exchange Shares at the price per share paid for one Conversion Share.

The St. James Partnerships, as the holders of Warrants to purchase an aggregate of 4,075,528 shares of common stock, agreed to sell all their Warrants to us at the closing of this offering at a price for each three Warrants sold equal to the price per share paid for one Conversion Share.

The St. James Partnerships are expected to receive approximately $163.5 million out of the net proceeds of this offering in connection with the repurchase by us of equity securities held by them with the proceeds of this offering, including all the Warrants they hold. If the underwriters' option to purchase additional shares is not exercised, the Underbrink Family Entities will not receive any of the net proceeds of this offering. If the option to purchase additional shares is exercised, the Underbrink Family Entities will receive up to approximately $18.5 million out of the net proceeds of this offering in connection with the repurchase by us of equity securities held by them with the proceeds of this offering.

Under the terms of a Registration Rights Agreement dated December 17, 1999, the holders of $5,089,125 principal amount of and accrued interest (as of December 31, 2005) on our outstanding Convertible Notes have the right, subject to certain limitations, to include in this registration statement for the public offering the shares issuable on conversion of the principal and interest on their Convertible Notes, as well as the 503,167 shares of common stock issued in exchange for the common stock purchase warrants which they exchanged in November 2005 for shares of our common stock described below. The managing underwriter of this offering has the right, if it concludes that the amount of shares included in the offering for the account of selling stockholders must be reduced, to reduce the number of shares to be included in the registration statement for the account of the selling stockholders.

If the managing underwriter concludes that the amount of shares included in the registration statement for the account of selling stockholders must be reduced, our Recapitalization Agreements with the Underbrink Family Entities and the St. James Partnerships provide that the first shares to be cut back out of the number of shares to be sold and required to be purchased by us out of the net proceeds of this offering, are the shares held by the Underbrink Family Entities (including Conversion Shares, Exchange Shares and any other shares held). If the managing underwriter is of the view that a larger cutback is to be made in the number of shares included in the underwritten offering for the account of selling stockholders, the second classification of shares to be cut back out of shares required to be purchased by us out of the net proceeds of this offering will be the 501,748 shares held by SJMB, L.P. Thereafter, if the managing underwriter is of the view that a larger cutback is to be made in the number of shares included for the account of selling stockholders, the Conversion Shares, Exchange Shares and Warrants held by the St. James Partnerships to be purchased by us at the closing of this offering will be cut back pro rata based on the number of Conversion Shares, Exchange Shares and Warrants proposed to be sold collectively by the St. James Partnerships. For these purposes and the pro rata calculations required, each three Warrants would be treated as the equivalent of one Exchange Share and the first of the securities to be cut back from purchase by the Company from the St. James Partnerships would be the Conversion Shares and the last to be cut back would be the Warrants.

On October 7, 2005, we commenced a tender offer directed to the holders of 1,806,750 of our outstanding Warrants seeking to exchange one share of our common stock for three Warrants. The tender offer remained open for acceptance through November 14, 2005. During that period, the holders tendered 1,509,500 Warrants in exchange for 503,167 shares of our common stock. Mr. Jenkins, our President and a Director of our company, participated in the exchange and tendered 150,000 Warrants in exchange for 50,000 shares of our common stock. After expiration of the tender offer, there remained outstanding 297,250 Warrants, not including the 4,075,528 Warrants that the St. James Partnerships have agreed to sell to us in connection with the offering as previously described.

We agreed in September 2001 to pay to SJMB, L.P. a fee of approximately $274,000 in consideration of SJMB, L.P. providing cash collateral of $8.2 million deposited to secure the performance of a continuing guaranty extended by SJMB, L.P. of our borrowing from our senior secured lender in 2000. The $274,000 sum due SJMB, L.P. has not been paid and is expected to be paid at the time of the offering.

On November 21, 2005, Mr. Underbrink converted $1,428,000 of accrued interest on our promissory notes into 190,400 shares of our common stock at a conversion price of $7.50 per share.

Under the terms of the Recapitalization Agreements, the Underbrink Family Entities and the St. James Partnerships are to receive payments out of the net proceeds realized by us in this offering for shares of common stock the Underbrink Family Entities and the St. James Partnerships hold and will receive upon conversion of the Convertible Notes they hold at the closing of this offering. The St. James Partnerships are also to receive payment for the warrants they hold that are to be sold to us. The amounts that the Underbrink Family Entities and the St. James Partnerships are paid for their securities will depend upon the price at which our shares are sold in this offering and the net proceeds received by us. Our purchase of their shares and warrants is subject to cutback under the terms of the Recapitalization Agreements as described above. At present, we estimate that, as a consequence of the terms of this offering expected at this time and those cutback provisions, if the underwriters' option to purchase additional shares is not exercised, we will not repurchase any shares from the Underbrink Family Entities at the closing of this offering. If the underwriters' option to purchase additional shares is exercised, the Underbrink Family Entities will receive up to approximately $18.5 million out of the net proceeds of this offering in connection with the purchase by us of equity securities held by them with the proceeds of this offering.

On December 12, 2005, Overcup Capital, LLC replaced St. James Capital Corp. as general partner of St. James Capital Partners, L.P. St. James Capital Partners, L.P. will receive a total of $34.0 million from this offering as a result of our repurchase of equity securities held by them with the proceeds of this offering.

In the event an underwritten public offering is not completed by June 30, 2006, the St. James Partnerships agreed to exchange their Warrants for shares of common stock at an exchange rate of three Warrants for one share of common stock.