Execution Version
SERVICES AND SECONDMENT AGREEMENT
BY
AND BETWEEN
WESTERN GAS HOLDINGS, LLC
AND
ANADARKO PETROLEUM CORPORATION
TABLE OF CONTENTS
| |
|
|
|
|
|
|
|
|
|
ARTICLE I |
|
|
|
|
|
|
|
SECONDMENT |
|
|
|
|
|
|
|
|
|
|
|
|
|
1.1
|
|
Seconded Employees |
|
|
2 |
|
|
1.2
|
|
Period of Secondment |
|
|
2 |
|
|
1.3
|
|
Withdrawal, Departure or
Resignation |
|
|
3 |
|
|
1.4
|
|
Termination of Secondment |
|
|
3 |
|
|
1.5
|
|
Supervision |
|
|
4 |
|
|
1.6
|
|
Seconded Employee Qualifications;
Approval |
|
|
4 |
|
|
|
|
|
|
|
|
|
|
|
|
ARTICLE II |
|
|
|
|
|
|
|
SECONDMENT SERVICES |
|
|
|
|
|
|
|
|
|
|
|
|
|
2.1
|
|
Secondment Services |
|
|
5 |
|
|
2.2
|
|
Cancellation or Reduction of
Secondment Services |
|
|
5 |
|
|
2.3
|
|
Workers’ Compensation |
|
|
5 |
|
|
|
|
|
|
|
|
|
|
|
|
ARTICLE III |
|
|
|
|
|
|
|
SERVICES REIMBURSEMENT |
|
|
|
|
|
|
|
|
|
|
|
|
|
3.1
|
|
Operational, Management, Reporting
and Routine Maintenance Expenses |
|
|
6 |
|
|
3.2
|
|
Seconded Employees |
|
|
6 |
|
|
|
|
|
|
|
|
|
|
|
|
ARTICLE IV |
|
|
|
|
|
|
|
ALLOCATION; RECORDS; AGENT |
|
|
|
|
|
|
|
|
|
|
|
|
|
4.1
|
|
Allocation; Records |
|
|
8 |
|
|
4.2
|
|
Agent |
|
|
8 |
|
|
|
|
|
|
|
|
|
|
|
|
ARTICLE V |
|
|
|
|
|
|
|
TERM |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ARTICLE VI |
|
|
|
|
|
|
|
GENERAL PROVISIONS |
|
|
|
|
|
|
|
|
|
|
|
|
|
6.1
|
|
Accuracy of Recitals |
|
|
10 |
|
|
6.2
|
|
Choice of Law; Submission to
Jurisdiction |
|
|
10 |
|
|
6.3
|
|
Notices |
|
|
10 |
|
|
6.4
|
|
Further Assurances |
|
|
11 |
|
|
6.5
|
|
Entire Agreement |
|
|
11 |
|
|
6.6
|
|
Effect of Waiver or Consent |
|
|
11 |
|
|
6.7
|
|
Amendment or Modification |
|
|
11 |
|
|
6.8
|
|
Assignment; Third-Party
Beneficiaries |
|
|
11 |
|
|
6.9
|
|
Counterparts |
|
|
11 |
|
|
6.10
|
|
Severability |
|
|
11 |
|
|
6.11
|
|
Interpretation |
|
|
12 |
|
|
6.12
|
|
Titles and Headings |
|
|
12 |
|
|
6.13
|
|
Relationship of the Parties |
|
|
12 |
|
i
| |
|
|
|
|
|
|
|
6.14
|
|
Binding Effect |
|
|
12 |
|
|
6.15
|
|
Time of the Essence |
|
|
13 |
|
|
6.16
|
|
Delay or Partial Exercise Not
Waiver |
|
|
13 |
|
|
6.17
|
|
Withholding or Granting of
Consent |
|
|
13 |
|
|
6.18
|
|
Laws and Regulations |
|
|
13 |
|
|
6.19
|
|
No Recourse Against Officers or
Directors |
|
|
13 |
|
|
6.20
|
|
Signatories Duly Authorized |
|
|
13 |
|
|
6.21
|
|
Incorporation of Exhibits by
References |
|
|
13 |
|
|
6.22
|
|
Dispute Resolution and
Arbitration |
|
|
13 |
|
|
6.23
|
|
Continuation of Work During
Dispute |
|
|
14 |
|
|
6.24
|
|
Legal Compliance |
|
|
15 |
|
-ii-
SERVICES AND SECONDMENT AGREEMENT
This Services and Secondment
Agreement (the “ Agreement ”), dated as of
May 14, 2008 (the “ Effective Date ”), is
entered into between Anadarko Petroleum Corporation, a Delaware
corporation (“ Anadarko ”), and Western Gas
Holdings, LLC, a Delaware limited liability company (“
General Partner ”) and the general partner of Western
Gas Partners, LP, a Delaware limited partnership (the “
Partnership ”). Anadarko and the General Partner are
hereinafter each referred to as a “ Party ” and
are collectively referred to as the “ Parties .”
Capitalized terms used herein but not defined shall have the
meanings given them in that certain Omnibus Agreement by and among
the Partnership, the General Partner and Anadarko, dated
May 14, 2008 (the “ Omnibus Agreement
”).
RECITALS:
WHEREAS, Anadarko will cause the
Anadarko Entities to provide to the Partnership Group the services
necessary to operate, manage, maintain and report the operating
results of the Partnership’s assets, including gathering
pipelines, compressors, treating facilities, transportation
pipelines or related equipment or assets (the “
Partnership Assets ”);
WHEREAS, in connection with the
provision of the services under this Agreement, Anadarko desires to
second to the General Partner certain personnel employed or
contracted by the Anadarko Entities in connection with the
Partnership Assets;
NOW THEREFORE, in consideration of
the premises and the mutual covenants and agreements contained
herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Anadarko and the
General Partner hereby agree as follows:
-1-
v
SECONDMENT
I)
Seconded
Employees.
Subject to the terms of this
Agreement, Anadarko agrees to cause the Anadarko Entities to second
to the General Partner, and the General Partner agrees to accept
the secondment of, those certain specifically identified
individuals (each, a “ Seconded Employee ” and
collectively, the “ Seconded Employees ”) listed
on Exhibit A (the “ Seconded Employee
Schedule ”) for the purpose of performing job functions
related to the Partnership Assets (the “ Secondment
”). The Seconded Employees will remain at all times employees
of the Anadarko Entities but, in addition, they will also be
temporary employees of the General Partner during the Period of
Secondment (as defined below) and shall, at all times during the
Period of Secondment, work under the direction, supervision and
control of the General Partner. Anadarko will retain the right to
cause the Anadarko Entities to hire or discharge the Seconded
Employees but, subject to the provisions in Section 1.2, will
not have the right to cause the Anadarko Entities to terminate the
Secondment to the General Partner or otherwise exercise direction,
supervision or control over the Seconded Employees. For each
Seconded Employee, the “ Period of Secondment ”
shall be that period of time as set forth in Section 1.2.
Seconded Employees shall have no authority or apparent authority to
act on behalf of the Anadarko Entities during the Period of
Secondment. The Seconded Employee Schedule sets forth the names of
the Seconded Employees seconded by the Anadarko Entities, the job
functions of the Seconded Employees and the starting date for the
Period of Secondment for each Seconded Employee. Individuals may be
added or removed from the Seconded Employee Schedule from time to
time by the execution by the Parties of a completed
“Addition/Removal/Change of Responsibility of Seconded
Employee” form, the form of which is attached to this
Agreement as Exhibit B , which will be fully binding on
the Parties for all purposes under this Agreement. Those rights and
obligations of the Parties under this Agreement that relate to
individuals that were on the Seconded Employee Schedule but then
later removed from the Seconded Employee Schedule, which rights and
obligations accrued before the removal of such individual, will
survive the removal of such individual from the Seconded Employee
Schedule to the extent necessary to enforce such rights and
obligations.
II)
Period of
Secondment.
Anadarko will cause the Anadarko
Entities to second to the General Partner each Seconded Employee on
the start date set forth on the Seconded Employee Schedule and
continue
-2-
to
second, during the period (and only during the period) that the
Seconded Employee is performing services for the General Partner,
until the earliest of:
A) the end of the term of this Agreement;
B) the end date, if any, set forth for the Seconded Employee
on the Seconded Employee Schedule (or another end date for such
Seconded Employee as mutually agreed in writing by the Parties)
(the “ End Date ”);
C) a withdrawal, departure, resignation or termination of
such Seconded Employee under Section 1.3;
D) the date on which WGR Holdings, LLC ceases to own a
majority of the issued and outstanding voting equity of the General
Partner and the General Partner has entered into satisfactory
arrangements which it determines, in good faith, will provide it
with suitable qualified and experienced full-time or seconded
employees necessary to operate, manage and maintain the Partnership
Assets and
E) a termination of Secondment for such Seconded Employee
under Section 1.4.
At the end of the Period of
Secondment for any Seconded Employee, such Seconded Employee will
no longer be subject to the direction of the General Partner with
regard to the Seconded Employee’s day-to-day
activities.
III)
Withdrawal, Departure or
Resignation.
Anadarko will use reasonable efforts
to cause the Anadarko Entities to prevent any early withdrawal,
departure or resignation of any Seconded Employee prior to the End
Date for such Seconded Employee’s Period of Secondment. If
any Seconded Employee tenders his resignation to an Anadarko Entity
as an employee of such Anadarko Entity, Anadarko will promptly
notify the General Partner. During the Period of Secondment for any
Seconded Employee, Anadarko will cause the Anadarko Entities to not
voluntarily withdraw or terminate any Seconded Employee except with
the written consent of the General Partner (which may be through
the execution of a completed Addition/Removal/Change of
Responsibility of Seconded Employee form), such consent not to be
unreasonably withheld. Anadarko will indemnify, defend and hold
harmless the General Partner and its directors, officers and
employees against any and all costs, expenses (including reasonable
attorneys’ fees), claims, demands, losses, liabilities,
obligations, actions, lawsuits and other proceedings, judgments and
awards (each, a “ Loss ” and collectively, the
“ Losses ”) arising out of or in any way
connected with or related to the termination of employment of any
Seconded Employee by any Anadarko Entity without the consent of THE
GENERAL PARTNER, EVEN THOUGH SUCH LOSS MAY BE CAUSED IN PART BY THE
NEGLIGENCE OF ONE OR MORE OF THE PARTNERSHIP ENTITIES, except to
the extent that such Losses (i) arise solely out of or result
solely from the negligence, gross negligence or willful misconduct
of any of the Partnership Entities, or (ii) arise in
connection with the termination of a Seconded Employee for cause.
Upon the termination of employment, the Seconded Employee will
cease performing services for the General Partner.
IV)
Termination of
Secondment.
The General Partner will have the
right to terminate the Secondment to it of any Seconded Employee
for any reason at any time. Subject to Section 1.2, Anadarko
will not have the right to cause any Anadarko Entity to terminate
the Secondment to the General Partner of any Seconded Employee.
Upon the termination of any Seconded Employee’s Period of
Secondment, Anadarko will be solely liable for any costs or
expenses associated with the termination of the
-3-
Secondment, except as otherwise specifically set forth in this
Agreement. Anadarko will indemnify, defend and hold harmless the
General Partner and its directors, officers and employees against
all Losses arising out of or in any way connected with or related
to the termination of the Secondment of any Seconded Employee by
THE GENERAL PARTNER, EVEN THOUGH SUCH LOSS MAY BE CAUSED IN PART BY
THE NEGLIGENCE OF ONE OR MORE OF THE PARTNERSHIP ENTITIES, except
to the extent that such Losses arise solely out of or result solely
from the negligence, gross negligence or willful misconduct of any
of the Partnership Entities. Upon the termination of a Secondment,
the Seconded Employee will cease performing services for the
General Partner. At no time will the General Partner have the right
to terminate the employment with the Anadarko Entities of the
Seconded Employees.
V)
Supervision.
During the Period of Secondment, the
General Partner shall:
A) be ultimately and fully responsible for the daily work
assignments of the Seconded Employee (and with respect to Seconded
Employees that also provide services to the Anadarko Entities in
connection with its operations (“ Shared Seconded
Employees ”), during those times that the Shared Seconded
Employees are performing services for the General Partner
hereunder), including supervision of their day-to-day work
activities and performance consistent with the purposes stated in
Section 1.1 and the job functions set forth in the Seconded
Employee Schedule;
B) set the hours of work and the holidays and vacation
schedules (other than with respect to Shared Seconded Employees, as
to which the General Partner and Anadarko shall jointly determine)
for the Seconded Employee and
C) have the right to determine training which will be
received by the Seconded Employee.
In the course and scope of performing
any Seconded Employee’s job functions, the Seconded Employee
will be integrated into the organization of the General Partner,
will report into the General Partner’s management structure,
and will be under the direct management and supervision of the
General Partner. The General Partner shall designate one of its
officers to be responsible for the supervisory function set forth
in this Section 1.5 on behalf of the General Partner.
VI)
Seconded Employee
Qualifications; Approval.
Anadarko will cause the Anadarko
Entities to provide such suitably qualified and experienced
Seconded Employees as it is able to make available to the General
Partner, and the General Partner will have the right to approve or
reject each such Seconded Employee.
-4-
v
SECONDMENT
SERVICES
I)
Secondment
Services.
Anadarko shall cause the Anadarko
Entities to second Seconded Employees to the General Partner to
provide the General Partner with those services necessary to
operate, manage, maintain and report the operating results of the
Partnership Assets (the “ Secondment Services
”).
II)
Cancellation or Reduction of
Secondment Services.
The General Partner may terminate or
reduce the level of any of the Secondment Services on 30
days’ prior written notice to Anadarko. In the event the
General Partner terminates the Secondment Services, the General
Partner shall pay Anadarko the monthly installment for the last
month (or portion thereof) in which it received such services. Upon
payment thereof, the General Partner shall have no further payment
obligations. In the event that the General Partner reduces the
level of any of the Secondment Services, the Parties will negotiate
in good faith to determine an appropriate Services Reimbursement
(as defined in Section 3.1 below) for the reduced Secondment
Services.
III)
Workers’
Compensation.
At all times, Anadarko will cause the
Anadarko Entities to maintain workers’ compensation insurance
(either through an insurance company or self-insured arrangement)
applicable to the Seconded Employees. Anadarko will cause the
Anadarko Entities to name the General Partner as an also insured
employer under such insurance policy. Prior to being assigned any
duties by the General Partner, each Seconded Employee must sign an
acknowledgement that the Seconded Employee is an employee during
the Secondment Period of both the Anadarko Entities and the General
Partner and that for any work place injury, the Seconded
Employee’s sole remedy will be under such Anadarko
Entity’s workers’ compensation insurance policy.
Notwithstanding the foregoing, nothing herein shall preclude a
Seconded Employee from participating in benefit programs generally
available to employees of Anadarko Entities.
-5-
v
SERVICES
REIMBURSEMENT
I)
Operational, Management,
Reporting and Routine Maintenance Expenses.
On or before the fifth business day
of each month, Anadarko shall send an invoice to the General
Partner for that amount of money associated with all expenses
incurred by the Anadarko Entities in connection with the
performance of the Secondment Services during the preceding month
(the “ Services Reimbursement ”). The General
Partner shall pay such invoice within 30 days of
receipt.
II)
Seconded
Employees.
Among other items, the Services
Reimbursement shall include all reasonable cash expenses incurred
by the Anadarko Entities for the Seconded Employees, including, but
not limited to:
A) compensation, salary and wages (including payroll and
withholding taxes associated therewith);
B) 401(k) costs and any matching 401(k) contributions;
C) vacation and sick leave benefits;
D) medical and health insurance benefits;
E) disability insurance;
F) workers’ compensation insurance;
G) life insurance;
H) severance payments, if any and
I) any other employee benefit for which the Anadarko
Entities incur costs.
The costs and expenses described in
(a) through (i) above are referred to as “
Seconded Employee Expenses .” For the avoidance of any
doubt, the Seconded Employee Expenses shall not include any
payments made to Seconded Employees under Anadarko’s Value
Creation Plan (or any successor plan thereto) and the excess of
actual bonus amounts awarded under Anadarko’s Annual
Incentive Plan (“ AIP ”) to any Seconded
Employee over 120% of such Seconded Employee’s AIP bonus
target (collectively, “ Excess Bonus Expenses
”). Where it is not reasonably practicable to determine the
cost of such a cost or expense, Anadarko or the applicable Anadarko
Entity may make a good faith reasonable estimate of such cost or
expense (and provided that any such estimates, other than with
respect to benefit load, are “trued up” within
10 days of the end of each quarter based on the actual amount
of the expenses, expenditures or payments in respect of which
estimates were made in the immediately preceding
-6-
quarter). Anadarko or the applicable Anadarko Entity may include
the costs and expenses described in (b) through (i) above
in a percentage benefit load based upon the amount of costs and
expenses incurred in (a) above. Subject to the parenthetical
clause included in this paragraph, the General Partner shall accept
any estimate or benefit load described in this paragraph, provided
that such estimate is reasonable and made in good faith.
-7-
v
ALLOCATION; RECORDS;
AGENT
I)
Allocation;
Records.
Anadarko will use commercially
reasonable efforts to maintain an allocation schedule reflecting
the direct and indirect costs of the Seconded Employee Expenses
based on the Secondment Services. The General Partner will use
commercially reasonable efforts to keep and maintain books/records
reflecting hours worked and
|