Exhibit 10.1

 

Execution Version

 

SERVICES AGREEMENT

 

This SERVICES AGREEMENT (this “Agreement”) dated as of May 9, 2017 (the
“Effective Date”), is entered into by and among Antero Midstream GP LP, a
Delaware limited partnership (the “Partnership”), AMGP GP LLC, a Delaware
limited liability company and the sole general partner of the Partnership (the
“General Partner”), Antero IDR Holdings LLC, a Delaware limited liability
company (“IDR LLC”), and Antero Resources Corporation, a Delaware corporation
(“Antero”). The Partnership, the General Partner, IDR LLC and Antero may be
referred to herein individually as a “Party” or collectively as the “Parties.”

 

RECITALS

 

WHEREAS, the Partnership and the other members of the Partnership Group (as
defined below) desire that Antero perform the Services (as defined below); and

 

WHEREAS, the Parties desire to set forth their respective rights and
responsibilities with respect to the provision of the Services.

 

NOW THEREFORE, in consideration of their mutual undertakings and agreements
hereunder, the Parties undertake and agree as follows:

 

ARTICLE 1
PERFORMANCE OF SERVICES

 

1.1                               Agreement to Provide Services.  Antero hereby
agrees to provide, or cause to be provided to, the General Partner, the
Partnership and the subsidiaries of the Partnership (other than Antero Midstream
Partners LP (“Antero Midstream”) and its subsidiaries and Antero Midstream
Partners GP LLC, the sole general partner of Antero Midstream) (collectively,
subject to such exclusions, the “Partnership Group”) with certain corporate,
general and administrative services as set forth on Exhibit A hereto
(collectively, the “Services”).  Antero shall provide, or cause to be provided
to, the Partnership Group the Services in a manner consistent with the nature
and quality of the services that Antero undertakes in the management of its own
business and affairs.

 

ARTICLE 2
RELATIONSHIP OF ANTERO AND THE PARTNERSHIP GROUP

 

2.1                               Relationship of the Parties.  The parties
acknowledge that the Services hereunder shall be performed by such personnel as
Antero and the General Partner shall mutually agree from time to time (the
“Services Personnel”).  Antero and the General Partner further agree that the
Services Personnel shall, while performing the Services hereunder, work under
the direction, supervision and control of the General Partner.  Subject to the
foregoing, nothing hereunder shall be construed as creating any relationship
between Antero, on the one hand, and any member of the Partnership Group, on the
other hand, that constitutes a partnership, agency or fiduciary relationship,
joint venture, limited liability company, association, or any other enterprise.

 

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2.2                               The General Partner’s Right to Observe.  The
General Partner shall at all times have the right to observe and consult with
Antero in connection with Antero’s performance of its obligations under this
Agreement. The General Partner shall comply with all reasonable requirements of
Antero prior to such observation or consultation, including but not limited to
safety requirements.

 

ARTICLE 3
SERVICES FEE AND BILLING PROCEDURES

 

3.1                               Services Fee.  Subject to and in accordance
with the terms and provisions of this Article 3 and such reasonable allocation
and other procedures as may be agreed upon by the Parties from time to time, the
Partnership hereby agrees to pay Antero a fixed fee at the rate of $500,000 per
complete year that this Agreement is in effect (the “Services Fee”), payable in
equal monthly installments on or before the tenth (10th) business day of every
month, commencing on the first month following the Effective Date.  The Services
Fee is subject to adjustment on an annual basis, beginning on January 1, 2018,
(a) by a percentage equal to the change in the Consumer Price Index over the
previous 12 calendar months, (b) to reflect any increase in the cost of
providing the Services to the Partnership Group due to changes in any law,
rule or regulation applicable to the Partnership Group, including the rules of
any exchange upon which the Partnership’s debt or equity is listed or traded or
any law, rule or regulation regarding payroll taxes applicable to the
Partnership Group (other than changes in any law, rule or regulation applicable
to payroll taxes incurred by the Antero Group in connection with the grant of
equity interests in the Partnership pursuant to the Antero Midstream GP LP
Long-Term Incentive Plan (the “AMGP LTIP”)), or (c) to reflect any increase in
the scope and extent of the Services; provided, however that the Services Fee
shall not be decreased below the initial fee provided in this Agreement unless
the type or extent of such Services materially decreases.  The Partnership shall
also reimburse Antero and its Affiliates other than the Partnership Group
(collectively, the “Antero Group”) for all other direct or allocated costs and
expenses in excess of the Services Fee, in each case, to the extent that such
costs and expenses are incurred by the Antero Group and are directly allocable
to the provision of Services to the Partnership Group, including the following:

 

(a)                                 any payments or expenses incurred for
insurance coverage, including allocable portions of premiums, and negotiated
instruments (including surety bonds and performance bonds) provided by
underwriters with respect to the assets or the business of the Partnership
Group;

 

(b)                                 all expenses and expenditures incurred by
the Partnership or the General Partner, if any, as a result of the Partnership
becoming and continuing as a publicly traded entity, including but not limited
to, costs associated with annual and quarterly reports, independent auditor
fees, partnership governance and compliance, registrar and transfer agent fees,
tax return preparation and related services, legal fees and independent director
compensation; and

 

(c)                                  any taxes (other than payroll taxes
incurred by the Antero Group and which are directly allocable to the provision
of Services to the Partnership Group, unless such payroll taxes were incurred by
the Antero Group in connection with the grant of any equity

 

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interests in the Partnership pursuant to the AMGP LTIP) or other direct
operating expenses paid by the Antero Group for the benefit of the Partnership
Group.

 

For purposes of this Agreement, “Affiliate” means, when used with respect to any
Person, any Person directly or indirectly controlling, controlled by or under
common control with such Person. As used herein, the term “control” means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through ownership
of voting securities, by contract or otherwise, and the term “Person” means any
natural person, corporation, limited liability company, partnership, joint
venture, trust, unincorporated organization, association, joint stock company or
governmental authority.

 

3.2                               Reimbursement Procedures.  The Partnership
will reimburse Antero, or the members of the Antero Group providing the
Services, as applicable (each a “Service Provider”), for costs and expenses
billed  pursuant to Section 3.1 in excess of the Services Fee no later than the
later of (a) the last day of the month following the performance month or
(b) thirty (30) business days following the date of the Service Provider’s
billing to the Partnership.  Billings and payments may be accomplished by
inter-company accounting procedures and transfers. The General Partner shall
have the right to review all source documentation concerning the liabilities,
costs, and expenses allocated to the Partnership and/or the Partnership Group
hereunder upon reasonable notice and during regular business hours.

 

ARTICLE 4
TERM AND TERMINATION

 

4.1                               Term.  Unless terminated earlier, this
Agreement shall continue in effect until the twentieth (20th) anniversary of the
date hereof and from year to year thereafter (with the initial term of this
Agreement deemed extended for each of any such additional year) until such time
as this Agreement is terminated, effective upon an anniversary of the execution
of the Initial Services Agreement, by written notice from either Party to the
other Party on or before the one hundred eightieth (180th) day prior to such
anniversary.

 

4.2                               Termination.

 

(a)                                 Methods of Termination.  Notwithstanding
anything to the contrary in this Agreement, this Agreement may be terminated at
any time (1) by mutual written agreement of the Parties and (2) by the
Partnership, in its sole discretion, effective upon delivery of written notice
of such termination to Antero.

 

(b)                                 Effect of Termination.  Upon termination of
this Agreement, all rights and obligations of the Parties under this Agreement
shall terminate, provided, however, that such termination shall not affect or
excuse the performance of any party under the provisions of Article 5 which
provisions shall survive the termination of this Agreement indefinitely.

 

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ARTICLE 5
INDEMNITY

 

5.1                               Indemnification Scope.  IT IS IN THE BEST
INTERESTS OF THE PARTIES THAT CERTAIN RISKS RELATING TO THE MATTERS GOVERNED BY
THIS AGREEMENT SHOULD BE IDENTIFIED AND ALLOCATED AS BETWEEN THEM. IT IS
THEREFORE THE INTENT AND PURPOSE OF THIS AGREEMENT TO PROVIDE FOR THE
INDEMNITIES SET FORTH HEREIN TO THE MAXIMUM EXTENT ALLOWED BY LAW. ALL
PROVISIONS OF THIS ARTICLE SHALL BE DEEMED CONSPICUOUS WHETHER OR NOT
CAPITALIZED OR OTHERWISE EMPHASIZED.

 

5.2                               Indemnified Persons.  Wherever the
“Partnership” or “Antero” appears as an indemnitee in this Article, the term
shall include that entity and its Affiliates, and the respective agents,
officers, directors, employees, representatives and contractors and
subcontractors of any tier of the foregoing entities involved in actions or
duties to act on behalf of the indemnified Party.  These groups will be the
“Partnership Indemnitees” or the “Antero Indemnitees” as applicable, provided,
however, that for the avoidance of doubt, the Partnership Indemnitees shall not
include any member of the Antero Group, and the Antero Indemnitees shall not
include any member of the Partnership Group. “Third parties” shall not include
any Partnership Indemnitees or Antero Indemnitees.

 

5.3                               Indemnifications.

 

(a)                                 THE PARTNERSHIP SHALL RELEASE,
DEFEND, INDEMNIFY, AND HOLD HARMLESS THE ANTERO INDEMNITEES FROM AND AGAINST ANY
AND ALL CLAIMS, CAUSES OF ACTION, DEMANDS, LIABILITIES, LOSSES, DAMAGES, FINES,
PENALTIES, JUDGMENTS, EXPENSES AND COSTS, INCLUDING REASONABLE ATTORNEYS’ FEES
AND COSTS OF INVESTIGATION AND DEFENSE (EACH, A “LIABILITY”) (INCLUDING, WITHOUT
LIMITATION, ANY LIABILITY FOR (1) DAMAGE, LOSS OR DESTRUCTION OF THE ASSETS OR
THE BUSINESS OF THE PARTNERSHIP GROUP, (2) BODILY INJURY, ILLNESS OR DEATH OF
ANY PERSON, AND (3) LOSS OF OR DAMAGE TO EQUIPMENT OR PROPERTY OF ANY
PERSON), IN EACH CASE, ARISING FROM OR RELATING TO THE PARTNERSHIP’S OR ANTERO’S
PERFORMANCE OF THIS AGREEMENT, EXCEPT TO THE EXTENT SUCH LIABILITY IS CAUSED BY
THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE ANTERO INDEMNITEES.

 

(b)                                 ANTERO SHALL RELEASE, DEFEND, INDEMNIFY, AND
HOLD HARMLESS THE PARTNERSHIP INDEMNITEES FROM AND AGAINST ANY AND ALL
LIABILITIES (INCLUDING, WITHOUT LIMITATION, ANY LIABILITY FOR (1) DAMAGE, LOSS
OR DESTRUCTION OF THE ASSETS OR THE BUSINESS OF THE PARTNERSHIP GROUP,
(2) BODILY INJURY, ILLNESS OR DEATH OF ANY PERSON AND (3) LOSS OF OR DAMAGE TO
EQUIPMENT OR PROPERTY OF ANY PERSON), IN EACH CASE, ARISING FROM OR RELATING TO
ANTERO’S PERFORMANCE UNDER THIS AGREEMENT TO THE EXTENT SUCH LIABILITY IS CAUSED
BY THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE ANTERO INDEMNITEES.

 

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5.4                               Damages Limitations.  Except as provided in
this Section 5.4, any and all damages recovered by either Party pursuant to this
Article 5 or pursuant to any other provision of or actions or omissions under
this Agreement shall be limited to actual damages. CONSEQUENTIAL DAMAGES
(INCLUDING WITHOUT LIMITATION BUSINESS INTERRUPTIONS AND LOST PROFITS) AND
EXEMPLARY AND PUNITIVE DAMAGES SHALL NOT BE RECOVERABLE UNDER ANY CIRCUMSTANCES
EXCEPT TO THE EXTENT THOSE DAMAGES ARE INCLUDED IN THIRD PARTY CLAIMS FOR WHICH
A PARTY HAS AGREED HEREIN TO INDEMNIFY THE OTHER PARTY. EACH PARTY ACKNOWLEDGES
IT IS AWARE THAT IT HAS POTENTIALLY VARIABLE LEGAL RIGHTS UNDER COMMON LAW AND
BY STATUTE TO RECOVER CONSEQUENTIAL, EXEMPLARY, AND PUNITIVE DAMAGES UNDER
CERTAIN CIRCUMSTANCES, AND, EXCEPT AS PROVIDED IN THE PRECEDING SENTENCE WITH
RESPECT TO THIRD PARTY CLAIMS, EACH PARTY NEVERTHELESS WAIVES, RELEASES,
RELINQUISHES, AND SURRENDERS RIGHTS TO CONSEQUENTIAL PUNITIVE AND EXEMPLARY
DAMAGES TO THE FULLEST EXTENT PERMITTED BY LAW WITH FULL KNOWLEDGE AND AWARENESS
OF THE CONSEQUENCES OF THE WAIVER REGARDLESS OF THE NEGLIGENCE OR FAULT OF
EITHER PARTY.

 

5.5                               Defense of Claims.  The indemnifying Party
shall defend, at its sole expense, any claim, demand, loss, liability, damage,
or other cause of action within the scope of the indemnifying Party’s
indemnification obligations under this Agreement, provided that the indemnified
Party notifies the indemnifying Party promptly in writing of any claim, loss,
liability, damage, or cause of action against the indemnified Party and gives
the indemnifying Party information and assistance at the reasonable expense of
the indemnifying Party in defense of the matter. The indemnified Party may be
represented by its own counsel (at the indemnified Party’s sole expense) and may
participate in any proceeding relating to a claim, loss, liability, damage, or
cause of action in which the indemnified Party or both Parties are defendants,
provided, however, the indemnifying Party shall, at all times, control the
defense and any appeal or settlement of any matter for which it has
indemnification obligations under this Agreement so long as any such settlement
includes an unconditional release of the indemnified Party from all liability
arising out of such claim, demand, loss, liability, damage, or other cause of
action and does not require any remediation or other action other than the
payment of money which the indemnifying party will be responsible for hereunder
and does not include a statement as to or an admission of fault, culpability or
a failure to act by or on behalf of the indemnified Party.  Should the Parties
both be named as defendants in any third-party claim or cause of action arising
out of or relating to the Services, the Parties will cooperate with each other
in the joint defense of their common interests to the extent permitted by law,
and will enter into an agreement for joint defense of the action if the Parties
mutually agree that the execution of the same would be beneficial.

 

ARTICLE 6
NOTICES

 

Either Party may give notices to the other Party by first class mail postage
prepaid, by overnight delivery service, or by facsimile with receipt confirmed
at the following addresses or

 

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other addresses furnished by a Party by written notice. Any telephone numbers
below are solely for information and are not for Agreement notices.

 

If to the Partnership Group to:

 

Antero Midstream GP LP

1615 Wynkoop Street
Denver, Colorado 80202

Attn: Chief Financial Officer
Fax: (303) 357-7315

 

If to Antero to:

 

Antero Resources Corporation
1615 Wynkoop Street
Denver, Colorado 80202
Attn: Chief Financial Officer
Fax: (303) 357-7315

 

ARTICLE 7
GENERAL

 

7.1                               Succession and Assignment.  This Agreement
shall be binding upon and inure to the benefit of the Parties named herein. No
Party may assign or otherwise transfer either this Agreement or any of its
rights, interests or obligations hereunder without the prior written approval of
the other Parties, which approval shall not be unreasonably withheld,
conditioned or delayed.

 

7.2                               Governing Law.  This Agreement will be
governed by and construed and enforced in accordance with the laws of the State
of Colorado, excluding any choice of Law rules which may direct the application
of the laws of another jurisdiction.

 

7.3                               Consent to Jurisdiction, Etc.; Waiver of Jury
Trial.  Each of the Parties hereby irrevocably consents and agrees that any
dispute arising out of or relating to this Agreement or any related document
shall exclusively be brought in the courts of the State of Colorado, in Denver
County or the federal courts located in the District of Colorado.  The Parties
agree that, after such a dispute is before a court as specified in this
Section 7.3 and during the pendency of such dispute before such court, all
actions with respect to such dispute, including any counterclaim, cross-claim or
interpleader, shall be subject to the exclusive jurisdiction of such court.  The
Parties also agree that after such a dispute is before a court as specified in
this Section 7.3, and during the pendency of such dispute before such court,
each of the Parties hereby waives, and agrees not to assert, as a defense in any
legal dispute, that it is not subject thereto or that such dispute may not be
brought or is not maintainable in such court or that its property is exempt or
immune from execution, that the dispute is brought in an inconvenient forum or
that the venue of the dispute is improper.  Each Party agrees that a final
judgment in any dispute described in this Section 7.3 after the expiration of
any period permitted for appeal and subject to any stay during appeal shall be
conclusive and may be enforced in other jurisdictions by suit on

 

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the judgment or in any other manner provided by laws.  THE PARTIES HEREBY WAIVE
IRREVOCABLY ANY AND ALL RIGHTS TO DEMAND A TRIAL BY JURY IN CONNECTION WITH THIS
AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREBY OR ANY DOCUMENT CONTEMPLATED
HEREIN OR OTHERWISE RELATED HERETO.

 

7.4                               Non-waiver of Future Default.  No waiver of
any Party of any one or more defaults by the other in performance of any of the
provisions of this Agreement shall operate or be construed as a waiver of any
other existing or future default or defaults, whether of a like or different
character.

 

7.5                               Audit and Maintenance of Records; Reporting. 
Notwithstanding the payment by the Partnership of any charges, the General
Partner shall have the right to review and contest the charges in accordance
with this Section 7.5. For a period of two years from the end of any calendar
year, the General Partner shall have the right, upon reasonable notice and at
reasonable times, to inspect and audit all the records, books, reports, data and
processes related to the Services performed by Antero to ensure Antero’s
compliance with the terms of this Agreement.  If any information provided to or
reviewed by the General Partner or its representatives pursuant to this
Section 7.5 is confidential, the parties shall execute a mutually acceptable
confidentiality agreement prior to such inspection or audit.

 

7.6                               Entire Agreement; Amendments and Schedules. 
This Agreement shall be amended or waived only by an instrument in writing
executed by both Parties. This Agreement constitutes the entire agreement of the
Parties relating to the matters contained herein and therein, superseding all
prior contracts or agreements, whether oral or written, relating to the matters
contained herein and therein.

 

7.7                               Force Majeure.

 

(a)                                 If either Party is rendered unable, wholly
or in part, by force majeure to carry out its obligations under this Agreement,
other than to make payments due, the obligations of that Party, so far as they
are affected by force majeure, will be suspended during the continuance of any
inability so caused, but for no longer period. The Party whose performance is
affected by force majeure will provide notice to the other Party, which notice
may initially be oral, followed by a written notification, and will use
commercially reasonable efforts to resolve the event of force majeure to the
extent reasonably possible.

 

(b)                                 “Force majeure”  as used in this Agreement
shall mean any cause or causes not reasonably within the control of the Party
claiming suspension and which, by the exercise of reasonable diligence, such
Party is unable to prevent or overcome, including acts of God, strikes, lockouts
or other industrial disturbances, acts of the public enemy, acts of terror,
sabotage, wars, blockades, military action, insurrections, riots, epidemics,
landslides, subsidence, lightning, earthquakes, fires, storms or storm warnings,
crevasses, floods, washouts, civil disturbances, explosions, breakage or
accidents to wells, machinery, equipment or lines of pipe; freezing of wells,
equipment on lines of pipe; the necessity for testing or making repairs or
alterations to wells, machinery, equipment or lines of pipe, freezing of wells,
equipment or lines of pipe; inability of any Party hereto to obtain, after the
exercise of reasonable diligence,

 

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necessary materials, supplies or governmental approvals, and action or restraint
by any Governmental Authority (so long as the Party claiming suspension has not
applied for or assisted in the application for, and has opposed where and to the
extent reasonable, such action or restraint, and as long as such action or
restraint is not the result of a failure by the claiming Party to comply with
any Applicable Law).  The settlement of strikes or lockouts will be entirely
within the discretion of the Party having the difficulty, and settlement of
strikes, lockouts, or other labor disturbances when that course is considered
inadvisable is not required.

 

7.8                               Counterpart Execution.  This Agreement may be
executed in one or more counterparts, including electronic, each of which shall
be deemed an original, but all of which together shall constitute one and the
same instrument.  In the event that any signature is delivered by facsimile
transmission or by e-mail delivery of a “.pdf” format data file, such signature
shall create a valid and binding obligation of the Party executing (or on whose
behalf such signature is executed) with the same force and effect as if such
facsimile or “.pdf” signature page were an original thereof.

 

7.9                               Third Parties.  The provisions of this
Agreement are enforceable solely by the Parties to this Agreement, and no third
party shall have the right, separate and apart from the Parties to this
Agreement, to enforce any provision of this Agreement or to compel any Party to
this Agreement to comply with the terms of this Agreement.

 

7.10                        Severability.  If any provision of this Agreement
shall be finally determined to be unenforceable, illegal or unlawful, such
provision shall, so long as the economic and legal substance of the transactions
contemplated hereby is not affected in any materially adverse manner as to any
Party, be deemed severed from this Agreement and the remainder of this Agreement
shall remain in full force and effect.

 

7.11                        Further Assurances. In connection with this
Agreement and all transactions contemplated by this Agreement, each signatory
party hereto agrees to execute and deliver such additional documents and
instruments and to perform such additional acts as may be necessary or
appropriate to effectuate, carry out and perform all of the terms, provisions
and conditions of this Agreement and all such transactions.

 

[Signature page follows]

 

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The Parties have caused this Agreement to be signed by their duly authorized
representatives effective as of the date first written above.

 

 

ANTERO RESOURCES CORPORATION

 

 

 

By:

/s/ Alvyn A. Schopp

 

Name:

Alvyn A. Schopp

 

Title:

Chief Administrative Officer, Regional Senior Vice President

 

 

 

 

ANTERO MIDSTREAM GP LP

 

 

 

By: AMGP GP LLC, its general partner

 

 

 

 

By:

/s/ Michael N. Kennedy

 

Name:

Michael N. Kennedy

 

Title:

Chief Financial Officer and Senior Vice President—Finance

 

 

 

 

AMGP GP LLC

 

 

 

 

By:

/s/ Michael N. Kennedy

 

Name:

Michael N. Kennedy

 

Title:

Chief Financial Officer and Senior Vice President—Finance

 

 

 

 

ANTERO IDR HOLDINGS LLC

 

 

 

 

By:

/s/ Glen C. Warren, Jr.

 

Name:

Glen C. Warren, Jr.

 

Title:

President and Secretary

 

[Signature Page —Services Agreement]

 

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Exhibit A

Services

 

(i)                                     Financial and administrative services
(including, but not limited to, treasury, accounting, internal and external
financial reporting, billing, corporate record keeping, cash management and
banking, planning, budgeting, internal audit, risk management, financial
planning & analysis, and other administrative functions)

 

(ii)                                  Information technology, telephone, office
support and other technology services

 

(iii)                               Legal services

 

(iv)                              Human resources services

 

(v)                                 Payroll

 

(vi)                              Business development services

 

(vii)                           Investor relations, regulatory compliance and
government relations

 

(viii)                        Tax matters

 

(ix)                              Insurance administration and claims processing

 

(x)                                 Overhead

 

(xi)                              Such other corporate, general and
administrative services as may be agreed upon by Antero and the General Partner

 

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