Exhibit 10.9
AMENDED AND
RESTATED
EMPLOYMENT
AGREEMENT
This AMENDED AND RESTATED
EMPLOYMENT AGREEMENT is effective as of December 2, 2008
by and between Randall Dean (“ Executive
”) and Regency GP LLC (the “ Managing General
Partner ”), the managing general partner of the
general partner of Regency Energy Partners LP (the “
Partnership ”).
WHEREAS , ADJHR, LLC (the “ Company
”) is an indirect wholly-owned subsidiary of the Partnership;
and
WHEREAS , the Managing General Partner employs Executive
to serve as its employee and to serve as the President and Chief
Executive Officer of the Company;
WHEREAS , the Managing General Partner and Executive
entered into an Employment Agreement dated effective
January 15, 2008 (the “ Agreement
”); and
WHEREAS , the Managing General Partner and Executive
have agreed to make certain modifications to the Agreement to
comply with the provisions of section 409A of the Internal Revenue
Code of 1986, as amended (the “ Code
”).
NOW, THEREFORE
, in consideration of the premises
and the mutual covenants set forth below, to avoid adverse tax
consequences under section 409A of the Code and for other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereby agree as
follows:
1. Employment
. The Managing General Partner
hereby agrees to employ Executive to serve as its employee and to
serve as the President and Chief Executive Officer of the Company,
and Executive hereby accepts such employment, on the terms and
conditions hereinafter set forth.
2. Term
. The period of employment of
Executive by the Managing General Partner under this Agreement (the
“ Employment Period ”) shall commence on
January 15, 2008 (the “ Commencement Date
”) and shall continue through the third anniversary
thereof.
3. Position and
Duties . During the
Employment Period, Executive shall serve as the President and Chief
Executive Officer of the Company, and shall report to the Chief
Executive Officer (or, if there is no Chief Executive Officer, the
highest-level executive officer) of the Managing General Partner.
Executive shall have those powers and duties with respect to the
Company normally associated with the position of President and
Chief Executive Officer, and such other powers and duties as may be
assigned to him by the Board of Directors of the Managing General
Partner (hereinafter referred to as “ Board
”); provided that , the Board shall assign him
only such other powers and duties as are of a type, nature and
dignity consistent with Executive’s position, and do not
violate any applicable laws or regulations. Subject to the
remaining provisions hereof, Executive shall devote his full
working time, attention and energies to the performance of his
duties for the Managing General Partner. Executive shall retain the
ability, without violating the terms of employment with the Company
or the Partnership’s
conflict of interest policies, to (i) have
an indirect economic interest in CDM MAX, LLC, a Texas limited
liability company (“ CDM MAX ”),
(ii) have board-level involvement with the operations and
affairs of CDM MAX, provided that such involvement
does not significantly interfere with Executive’s duties to
the Company, and (iii) receive payments related to CDM MAX,
both in respect of the indirect ownership position and consulting
fees disclosed to the Managing General Partner; provided ,
however , that Executive may not cause CDM MAX to solicit
customers of the Partnership or any of its Subsidiaries in areas in
which CDM MAX may become competitive with the Partnership or any of
its Subsidiaries. Executive may also manage personal investments
and engage in civic or charitable activities so long as the same do
not interfere with the performance of Executive’s
responsibilities as an employee of the Managing General Partner in
accordance with this Agreement. If, from time to time, the Company
or an Affiliate of the Company desires that the Executive render
services to any such Affiliate outside the scope of the services
described above, then (i) the Company shall first obtain
authorization from the Chief Executive Officer (or, if there is no
Chief Executive Officer, the highest-level executive officer) of
the Managing General Partner and (ii) any additional
compensation to Executive for providing those services must be
reasonably acceptable to Executive.
4. Place of
Performance . The
place of employment of Executive shall be at the Company’s
principal executive offices in Houston, Texas, or at such other
offices as the Board may designate; provided , that ,
Executive shall not be required to relocate outside of the Greater
Houston Metropolitan Area. Executive acknowledges that he may be
required to travel on Company business during the Employment
Period.
5. Compensation and Related
Matters .
(a) Base Salary . During the
Employment Period, the Managing General Partner shall pay Executive
a base salary at the rate of not less than $316,900 per year
(“ Base Salary ”). Executive’s Base
Salary shall be paid in accordance with the Managing General
Partner’s customary payroll practices. The Compensation
Committee of the Board shall annually review Executive’s Base
Salary for increase (but not decrease), consistent with the
compensation practices and guidelines of the Managing General
Partner. If Executive’s Base Salary is increased by the
Managing General Partner, such increased Base Salary shall then
constitute the Base Salary for all purposes of this
Agreement.
(b) Bonuses . During each
full or partial fiscal year of the Managing General Partner that
occurs during the Employment Period, Executive shall be eligible
for an annual performance bonus (the “ Bonus
”), to be awarded and determined at the sole discretion of
the Board or its Compensation Committee, of up to 100% of
Executive’s then current Base Salary. The Bonus, if any, may
be payable in cash, equity, or some combination thereof, at the
discretion of the Board or such Compensation Committee. Any Bonus
earned during a fiscal year shall be paid at such time as the
Managing General Partner customarily pays annual bonuses;
provided , that , Executive is still employed as of
such date, but in no event later than the 90th day of the year
following the fiscal year in which the Bonus is earned.
(c) Expenses . During the
Employment Period, the Managing General Partner shall promptly
reimburse Executive for all reasonable business expenses upon the
presentation of reasonably itemized statements of such expenses in
accordance with the Managing General
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Partner’s generally applied policies and
procedures now in force which provide an objectively determinable
nondiscretionary definition of the expenses eligible for
reimbursement, or as such policies and procedures may be modified
with respect to all executive officers of the Managing General
Partner. Notwithstanding any provision of this Agreement to the
contrary, the amount of expenses for which Executive is eligible to
receive reimbursement during any calendar year shall not affect the
amount of expenses for which Executive is eligible to receive
reimbursement during any other calendar year within the Employment
Period. In addition, any reimbursement of expenses provided for in
this Agreement shall be made on or before the last day of the
calendar year following the calendar year in which the expense was
incurred. Executive is not permitted to receive a payment or other
benefit in lieu of reimbursement under
Section 5(c).
(d) Vacation . During the
Employment Period, Executive shall be entitled to the maximum
amount of paid time off (including vacation, sick days and personal
time) permitted to employees of the Managing General Partner in
accordance with the Managing General Partner’s generally
applied policy as it may be established from time to time (assuming
more than ten years’ credited service by Executive. In
addition to vacation, Executive shall be entitled to the number of
national holidays per year that other executive officers of the
Managing General Partner with similar tenure are entitled under the
Managing General Partner’s policies.
(e) Welfare, Pension and
Incentive Benefit Plans and Perquisites . During the Employment
Period, Executive shall be entitled to participate in such employee
benefit plans offered by the Managing General Partner, or that it
may adopt from time to time, for its executives, in accordance with
the eligibility requirements for participation therein and the
other terms and conditions thereof.
(f) Equity Awards . During
each fiscal year of the Company that occurs during the Employment
Period, Executive shall be eligible to receive such equity awards
(which may include Class C Common Units of Regency GP Acquirer LP)
as the Board, or its Compensation Committee, may, in its sole
discretion, choose to award to him.
(g) Indemnification and
Insuranc e. Executive shall be entitled to insured status under
the Managing General Partner’s Directors & Officers
Liability Insurance to the same extent that its other executive
officers are insureds. In addition, at or about the time of the
execution of this Agreement, Executive and the Managing General
Partner shall enter into an indemnification agreement in
substantially the form entered into and in effect with the Managing
General Partners’ executive officers.
6. Termination
Procedure .
(a) Right and Notice of
Termination . Any party may terminate the employment
relationship with or without cause or good reason. Any termination
during the Employment Period (other than termination by death)
shall be communicated by written Notice of Termination to the other
party hereto in accordance with Section 10.
(b) Date of Termination .
“Date of Termination” shall mean (i) if
Executive’s employment is terminated by his death, the date
of his death, or (ii) if Executive’s employment is
terminated pursuant to notice, the date the Notice of Termination
is provided to the other party,
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provided , that , if applicable, the Notice of
Termination shall not be effective until any applicable cure period
has expired and such event or events leading to such termination
have not yet been cured.
(c) Consequences of Termination
by Managing General Partner Without Cause or by Executive For Good
Reason . Should the employment relationship be terminated:
(i) by the Managing General Partner without Cause; or
(ii) by the Executive for Good Reason, then the Executive
shall be entitled to:
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payment of accrued and unpaid
Base Salary and unused vacation time accrued through the Date of
Termination, to be paid in a lump sum immediately upon
Executive’s Date of Termination, but in no event later than
74 days thereafter;
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payment of any deferred
compensation accrued through the Date of Termination, to be paid in
accordance with the terms and conditions of the applicable
plan;
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payment of a lump-sum amount
equal to one year of Executive’s Base Salary to be paid to
Executive immediately upon Executive’s Date of Termination,
but in no event later than 74 days thereafter; provided ,
however , that , in case of a termination by
Executive for Good Reason based on an Interference Item (as defined
below), then the payment under this bullet-point paragraph shall be
made, rather than to the Executive, into a bonus pool arrangement
for the benefit of the Company’s employees, to be paid to
them, as determined by the Compensation Committee of the Board,
over and above the compensation they would otherwise receive, under
a written arrangement in which the Executive can be reasonably
assured of such payment into such pool for the benefit of such
employees, which shall be implemented within 90 days following the
Date of Termination or, if not so timely implemented, then such
lump-sum payment shall be paid into a pool under Executive’s
control who shall implement such pool for the benefit of such
employees;
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payment of the Bonus for the
fiscal year of termination based upon the maximum target Bonus
level for such year, prorated on a per day basis from the first
date of such fiscal year through the Date of Termination, based on
a calendar year of 365 or 366 days, as the case may be, to be paid
immediately following the end of the fiscal year for which such
Bonus relates, but in no event later than 74 days
thereafter;
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continuation of group health
coverage, at the Managing General Partner’s expense, for the
Executive and his spouse and dependents for a period of 36 months
following the Date of Termination, or until the Executive and his
spouse and dependents become eligible under another
employer’s health coverage (whichever is sooner);
and
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notwithstanding anything to the
contrary in any option or restricted unit agreement, accelerated
vesting to the Date of Termination of all outstanding options and
restricted units as well as an extension of the period during which
an award may be exercised to one year after the Date of
Termination.
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(d) Consequences of Termination
by Managing General Partner For Cause or by Executive Without Good
Reason . Should the employment relationship be terminated:
(i) by the Managing General Partner for Cause; or (ii) by
the Executive without Good Reason, then:
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the Executive shall be entitled
only to payment of accrued and unpaid Base Salary through the Date
of Termination, to be paid in a lump sum immediately upon
Executive’s Date of Termination, but in no event later than
74 days thereafter; and
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the Executive shall automatically
forfeit all deferred compensation, unused vacation time, unpaid
Bonuses, unredeemed equity awards, and other compensation, whether
vested or unvested (except for vested 401(k) and retirement
benefits).
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(e) Definition of Cause For
Termination . The Managing General Partner shall have
“Cause” for termination of the employment relationship
with Executive only upon any of the following to occur:
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Executive’s conviction of,
or a plea of nolo contendere to, a crime that constitutes a
felony;
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Executive’s breach of his
confidentiality or non-compete obligations under paragraph
(b) or (c) of Section 7;
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Determination by a court of
competent jurisdiction that Executive has breached his fiduciary
duty of loyalty, due care or good faith, as such terms are
understood and applied to officers of business entities under
Delaware law, to the Company or to the Managing General
Partner;
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Executive’s willful or
gross neglect of his duties;
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Executive’s commission of a
material act of fraud or willful misconduct with respect to the
performance of his duties;
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Executive’s
misappropriation of funds or property of the
Partnership;
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Executive’s knowing
engagement, without the express written consent of the Managing
General Partner or except as regarding CDM MAX in accordance with
Section 3, in any activity that competes with or is materially
injurious to the business or reputation of the Partnership;
or
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Executive’s material breach
of the material terms of this Agreement.
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(f) Definition of Good Reason For
Termination . Executive shall have “Good Reason”
for termination of the employment relationship with the Managing
General Partner upon any of the following to occur:
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So long as Executive is able to
perform his duties specified under Section 3 hereof, a
material cha
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