SERVICES AND SECONDMENT AGREEMENT
This Services and Secondment
Agreement (the “ Agreement ”), dated as of
August 10, 2007 (the “ Effective Date ”),
is entered into between QUICKSILVER RESOURCES INC., a Delaware
corporation (“ Company ”), and QUICKSILVER GAS
SERVICES GP LLC, a Delaware limited liability company (“
MLP GP ”), the general partner of Quicksilver Gas
Services LP (“ Partnership ”). Company and MLP
GP are hereinafter each referred to as a “ Party
” and collectively referred to as the “ Parties
.” The Partnership and the MLP GP are sometimes collectively
referred to as the “ Partnership Entities
.”
RECITALS:
WHEREAS, Company will provide to MLP
GP the services necessary to operate, manage and maintain the
Partnership’s approximately 120 mile natural gas gathering
pipeline system located in the southern portion of the Fort Worth
Basin (the “ Cowtown Pipeline ”) and the
Partnership’s natural gas processing plant, consisting of a
newly-constructed 125 MMcf/d natural gas processing unit and a 75
MMcf/d natural gas processing unit, located in Hood County, Texas
(the “ Cowtown Plant ,” together with the
Cowtown Pipeline and any subsequent additions to or expansions of
the Cowtown Pipeline or Cowtown Plant, the “ Cowtown
Assets ”);
WHEREAS, in connection with the
provision of the services under this Agreement, Company desires to
second to MLP GP certain personnel employed or contracted by
Company in connection with the Cowtown 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, Company and MLP GP
hereby agree as follows:
ARTICLE 1
SECONDMENT
1.1
Seconded Employees .
Subject to the terms of this
Agreement, Company agrees to second to MLP GP, and MLP GP 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 Cowtown Assets (the “ Secondment
”). The Seconded Employees will remain at all times employees
of the Company but in addition, they will also be temporary
employees of MLP GP during the Period of Secondment and shall, at
all times during the Period of Secondment, work under the
direction, supervision and control of MLP GP. The Company will
retain the right to hire or discharge the Seconded Employees but,
subject to the provisions in Section 1.2, will not have the
right to terminate the Secondment to MLP GP 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 Company during the Period of
Secondment. The Seconded Employee Schedule sets forth the names of
the Seconded Employees
seconded
by Company, 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.
1.2
Period of Secondment .
Company will second to MLP GP each
Seconded Employee on the start date set forth on the Seconded
Employee Schedule and continue to second, during the period (and
only during the period) that the Seconded Employee is performing
services for MLP GP, 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
Quicksilver Gas Holdings LLC ceases to own a majority of the issued
and outstanding voting common equity capital of MLP GP and MLP GP
has entered into satisfactory arrangements which in good faith MLP
GP determines will provide MLP GP with suitable qualified and
experienced full-time or seconded employees necessary to operate,
manage and maintain the Cowtown 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 MLP GP with regard to the
Seconded Employee’s day-to-day activities.
1.3
Withdrawal, Departure or Resignation .
Company will use reasonable efforts
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 Company as an employee of Company,
Company will promptly notify MLP GP. During the Period of
Secondment for any Seconded Employee, Company will not voluntarily
withdraw or terminate any Seconded Employee except with the written
consent of MLP GP (which may be through the execution of a
completed Addition/Removal/Change of Responsibility of Seconded
Employee
-2-
form),
such consent not to be unreasonably withheld. Company will
indemnify, defend and hold harmless MLP GP, 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 the Seconded Employee by Company without the consent
of the MLP GP 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 MLP GP.
1.4
Termination of Secondment .
MLP GP will have the right to
terminate the Secondment to MLP GP of any Seconded Employee for any
reason at any time. Subject to Section 1.2, Company will not
have the right to terminate the Secondment to MLP GP of any
Seconded Employee. Upon the termination of any Seconded
Employee’s Period of Secondment, Company will be solely
liable for any costs or expenses associated with the termination of
the Secondment, except as otherwise specifically set forth in this
Agreement. Company will indemnify, defend and hold harmless MLP GP,
its directors, officers and employees against all Losses arising
out of or in any way connected with the termination of Secondment
of the Seconded Employee by MLP GP 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 MLP GP. At no time will MLP GP have the right to
terminate the employment with the Company of the Seconded
Employees.
1.5
Supervision .
During the Period of Secondment, MLP
GP 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 Company in connection with its operations (“ Shared
Seconded Employees ”) during those times that the Shared
Seconded Employees are performing services for MLP GP 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 MLP GP and Company shall
jointly determine) for the Seconded Employee; and
(c) have the right to determine
training which will be received by the Seconded Employee.
-3-
In the course and scope of performing
any Seconded Employee’s job functions, the Seconded Employee
will be integrated into the organization of MLP GP, will report
into MLP GP’s management structure, and will be under the
direct management and supervision of MLP GP. MLP GP shall designate
one of its officers who does not also provide services to the
Company in connection with the Company’s operations to be
responsible for the supervisory function set forth in this Section
1.5 on behalf of MLP GP.
1.6
Seconded Employee Qualifications; Approval .
Company will provide such suitably
qualified and experienced Seconded Employees as Company is able to
make available to MLP GP, and MLP GP will have the right to approve
or reject such Seconded Employee.
ARTICLE 2
SECONDMENT SERVICES
2.1
Secondment Services .
Company shall second Seconded
Employees to MLP GP to provide MLP GP with those services necessary
to operate, manage and maintain the Cowtown Assets (the “
Secondment Services ”).
2.2
Cancellation or Reduction of Secondment Services .
MLP GP may terminate or reduce the
level of any of the Secondment Services on 30 days’
prior written notice to Company. In the event MLP GP terminates the
Secondment Services, MLP GP shall pay Company the monthly
installment for the last month (or portion thereof) in which it
received such services. Upon payment thereof, MLP GP shall have no
further payment obligations. In the event that MLP GP 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.
2.3
Workers’ Compensation .
At all times, the Company will
maintain workers’ compensation insurance applicable to the
Seconded Employees. The Company wil name MLP GP as an also insured
employer under such insurance policy. Prior to being assigned any
duties by MLP GP, each Seconded Employee must sign an
acknowledgement that the Seconded Employee is an employee during
the Secondment Period of both the Company and MLP GP and that for
any work place injury, the Seconded Employee’s sole remedy
will be under the Company’s workers’ compensation
insurance policy.
-4-
ARTICLE 3
SERVICES REIMBURSEMENT
3.1
Operational, Management, and Routine Maintenance Expenses
.
On or before the fifth business day
of each month, Company shall send an invoice to MLP GP for that
amount of money associated with all expenses incurred by Company in
connection with the performance of the Secondment Services during
the preceding month (the “ Services Reimbursement
”). MLP GP shall pay such invoice within 45 days of
receipt.
3.2
Seconded Employees .
Among
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