Exhibit 10.3

 

TRANSITION SERVICES AGREEMENT

 

BETWEEN

 

EXTERRAN HOLDINGS, INC.

(to be renamed Archrock, Inc.)

 

AND

 

EXTERRAN CORPORATION

 

DATED AS OF NOVEMBER 3, 2015

 

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TRANSITION SERVICES AGREEMENT

 

This Transition Services Agreement (this “Agreement”) is made and entered into
effective as of November 3, 2015 by and between Exterran Holdings, Inc. (to be
renamed Archrock, Inc.), a Delaware corporation (“RemainCo”), and Exterran
Corporation, a Delaware corporation (“SpinCo”). RemainCo and SpinCo are
sometimes herein referred to individually as a “Party” and collectively as the
“Parties.” Capitalized terms used herein and not otherwise defined herein shall
have the meanings ascribed to them in Article I.

 

RECITALS

 

WHEREAS, the Board of Directors of RemainCo has determined that it is
appropriate, advisable and in the best interests of RemainCo and its
stockholders to separate the SpinCo Business from the RemainCo Business and to
create a new publicly traded company that will operate the SpinCo Business;

 

WHEREAS, RemainCo, Exterran General Holdings LLC, Exterran Energy Solutions,
L.P., a Delaware limited partnership and indirect wholly owned subsidiary of
RemainCo (“EESLP”), SpinCo, AROC Corp., a Delaware corporation and wholly owned
subsidiary of EESLP (“Controlled”), EESLP LP LLC, AROC Services GP LLC, AROC
Services LP LLC, and Archrock Services, L.P., have entered into the Separation
and Distribution Agreement, dated November 3, 2015 (the “Separation Agreement”),
in connection with the separation of the SpinCo Business from RemainCo and the
distribution of SpinCo Common Stock to stockholders of RemainCo;

 

WHEREAS, the Separation Agreement also provides for the execution and delivery
of certain other agreements (collectively, the “Ancillary Agreements”),
including this Agreement, in order to facilitate and provide for the separation
of SpinCo and its Subsidiaries from RemainCo; and

 

WHEREAS, in order to ensure an orderly transition under the Separation
Agreement, it will be necessary for RemainCo, or its Affiliates, to provide to
SpinCo and for SpinCo, or its Affiliates, to provide to RemainCo, certain
corporate, general and administrative services described herein on an interim,
transitional basis.

 

NOW, THEREFORE, for and in consideration of the mutual covenants contained in
this Agreement, and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, RemainCo and SpinCo hereby agree as
follows:

 

ARTICLE I.
DEFINITIONS

 

Section 1.1            Definitions. As used herein, the following terms shall
have the following meanings, and capitalized terms used but not otherwise
defined herein shall have the meanings ascribed to them in the Separation
Agreement:

 

“Additional Services” has the meaning ascribed to such term in Section 2.1(c).

 

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“Affiliate” means, when used with respect to a specified Person, a Person that,
directly or indirectly, through one or more intermediaries, controls, is
controlled by or is under common control with such specified Person. For the
purpose of this definition, “control” (including with correlative meanings,
“controlled by” and “under common control with”), when used with respect to any
specified Person, means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of such Person,
whether through the ownership of voting securities or other interests, by
contract, agreement, obligation, indenture, instrument, lease, promise,
arrangement, release, warranty, commitment, undertaking or otherwise. It is
expressly agreed that, from and after the Effective Time and for purposes of
this Agreement, no member of the SpinCo Group shall be deemed to be an Affiliate
of any member of the RemainCo Group, and no member of the RemainCo Group shall
be deemed to be an Affiliate of any member of the SpinCo Group.

 

“Applicable Rate” means the Prime Rate plus one and one-half percent (1.5%), or
such lower rate as may from time to time represent the maximum rate of interest
payable under applicable Law.

 

“Applicable Services Initial Term” has the meaning ascribed to such term in
Section 2.1(g)(i).

 

“Applicable Services Termination Date” has the meaning ascribed to such term in
Section 2.1(g)(ii).

 

“Direct Charges” has the meaning ascribed to such term in Section 2.2(c).

 

“Distribution Date” means the date on which RemainCo, through the Agent,
distributes all of the issued and outstanding shares of SpinCo Common Stock to
holders of RemainCo Common Stock in the External Distribution.

 

“Effective Time” means 11:59 p.m. Eastern Time, or such other time as RemainCo
may determine, on the Distribution Date.

 

“Expiration Date” means the latest to occur of the Applicable Services
Termination Dates.

 

“Force Majeure” means, with respect to a Party, an event beyond the control of
such Party (or any Person acting on its behalf), which by its nature could not
have been reasonably foreseen by such Party (or such Person) or, if it could
have been reasonably foreseen, was unavoidable, and includes acts of God,
storms, floods, riots, labor unrest, pandemics, nuclear incidents, fires,
sabotage, civil commotion or civil unrest, interference by civil or military
authorities, acts of war (declared or undeclared) or armed hostilities, or other
national or international calamity or one or more acts of terrorism or failure
of energy sources or distribution or transportation facilities.

 

“Governmental Authority” means any nation or government, any state, province,
municipality or other political subdivision thereof, and any entity, body,
agency, commission, department, board, bureau, court, tribunal or other
instrumentality, whether federal, state, provincial, regional, local, domestic,
foreign or multinational, exercising executive, legislative,

 

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judicial, regulatory, administrative or other similar functions of, or
pertaining to, government and any official thereof.

 

“Group” means either the RemainCo Group or the SpinCo Group, as the context
requires.

 

“Person” means any individual, general or limited partnership, corporation,
business trust, joint venture, association, company, limited liability company,
unincorporated organization, a limited liability entity, any other entity and
any Governmental Authority.

 

“RemainCo Additional Services” has the meaning ascribed to such term in
Section 2.1(c).

 

“RemainCo Group” means RemainCo, each Subsidiary of RemainCo immediately after
the Effective Time and each Affiliate of RemainCo immediately after the
Effective Time, including Controlled and its Subsidiaries (in each case other
than any member of the SpinCo Group).

 

“RemainCo Services”  has the meaning ascribed to such term in Section 2.1(a).

 

“RemainCo Services Annex” means Annex A attached hereto.

 

“Service Coordinator” has the meaning ascribed to such term in Section 2.1(d).

 

“Service Fee” has the meaning ascribed to such term in Section 2.2(a).

 

“Service Provider” means a member of the RemainCo Group or the SpinCo Group, as
applicable, when it is providing Services to a member of the other Party’s
Group.

 

“Service Provider Group” means the RemainCo Group or the SpinCo Group, as
applicable, when it is providing Services to a member of the other Party’s
Group.

 

“Service Recipient” means a member of the SpinCo Group or the RemainCo Group, as
applicable, when it is receiving Services from a member of the other Party’s
Group.

 

“Service Recipient Group” means the SpinCo Group or the RemainCo Group, as
applicable, when it is receiving Services from a member of the other Party’s
Group.

 

“Services” has the meaning ascribed to such term in Section 2.1(a).

 

“Services Annex” means the RemainCo Services Annex or the SpinCo Services Annex,
as applicable.

 

“SpinCo Additional Services” has the meaning ascribed to such term in
Section 2.1(c).

 

“SpinCo Group” means SpinCo, each Subsidiary of SpinCo immediately after the
Effective Time and each Affiliate of SpinCo immediately after the Effective
Time, including EESLP and its Subsidiaries following the External Distribution
(in each case other than any member of the RemainCo Group).

 

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“SpinCo Services”  has the meaning ascribed to such term in Section 2.1(a).

 

“SpinCo Services Annex” means Annex B attached hereto.

 

“Subsidiary” means, with respect to any Person, any corporation, limited
liability company, joint venture or partnership of which such Person
(a) beneficially owns, either directly or indirectly, more than fifty percent
(50%) of (i) the total combined voting power of all classes of voting securities
of such Person, (ii) the total combined equity interests or (iii) the capital or
profit interests, in the case of a partnership, or (b) otherwise has the power
to vote, either directly or indirectly, sufficient securities to elect a
majority of the board of directors or similar governing body.

 

Section 1.2            Rules of Construction. The Recitals to this Agreement are
made a part hereof for all purposes. In this Agreement, terms defined in the
singular have the corresponding meanings in the plural, and vice versa. Unless
otherwise explicitly set forth herein, all references to Sections and Articles
refer to sections and articles of this Agreement, and all references to Annexes,
Exhibits, Schedules or Attachments refer to annexes, exhibits, schedules or
attachments to this Agreement, which are attached hereto and made a part hereof
for all purposes. The word “including” means “including, but not limited to.”
The words “hereof,” “hereby,” “herein,” “hereunder” and similar terms in this
Agreement shall refer to this Agreement as a whole and not any particular
section or article in which such words appear.

 

ARTICLE II.
PROVISION OF SERVICES

 

Section 2.1            Provision of Services

 

(a)           Services to be Provided. Commencing on the Distribution Date,
subject to the other provisions of this Agreement and the RemainCo Services
Annex and the SpinCo Services Annex, as applicable, the RemainCo Group will use
commercially reasonable efforts to provide, or to cause to be provided by its
Affiliates, agents or independent contractors, the services set forth in the
RemainCo Services Annex to this Agreement (together with any RemainCo Additional
Services, the “RemainCo Services”) to the applicable member of the SpinCo Group,
and the SpinCo Group will use commercially reasonable efforts to provide, or to
cause to be provided by its Affiliates, agents or independent contractors, the
services set forth in the SpinCo Services Annex to this Agreement (together with
any SpinCo Additional Services, the “SpinCo Services” and the SpinCo Services
together with the RemainCo Services, the “Services”) to the applicable member of
the RemainCo Group.

 

(b)           Nature and Quality of Services. The Service Provider warrants that
the Services performed shall be performed in accordance with Section 4.14 of
this Agreement and, except as otherwise specifically provided by written
agreement of the Parties, in the same or similar manner as such Services were
performed by RemainCo and its Subsidiaries (including, for purposes of this
Section 2.1(b), members of the SpinCo Group) prior to the Distribution Date and
at the same general level and with the same general degree of care, attention,
accuracy and responsiveness as when performed by the Service Provider for
itself, another member of the Service Provider Group or third parties.

 

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(c)           Additional Services. Prior to the Expiration Date, if one Party
identifies any commercial or other service that it needs to assure a smooth and
orderly transition of the SpinCo Business or the RemainCo Business, as
applicable, in connection with the consummation of the transactions contemplated
by the Separation Agreement, and that is not otherwise governed by the
provisions of the Separation Agreement or any Ancillary Agreement, the Parties
will discuss whether there is a mutually acceptable basis on which the other
Party will provide such service, which such other Party may agree or decline to
provide at its sole discretion. Any such additional services that the RemainCo
Group may agree to provide to the SpinCo Group are herein referred to as
“RemainCo Additional Services” and any such additional services that the SpinCo
Group may agree to provide to the RemainCo Group are herein referred to as
“SpinCo Additional Services” and, together with RemainCo Additional Services,
“Additional Services.” Any change to the volume or nature of the Services or the
location where such Services are to be provided shall be subject to the mutual
agreement of the Parties.

 

(d)           Service Coordinators.  Each Party will appoint in writing a
representative to act as the primary contact with respect to the provision of
the Services and the resolution of disputes under this Agreement (each such
person, a “Service Coordinator”). The initial Service Coordinators shall be the
individuals identified on Annex C hereof.  Neither Party may change its
respective Service Coordinator without the prior written consent of the other
Party (which consent shall not be unreasonably withheld).  The Service
Coordinators shall meet as expeditiously as possible to resolve any dispute
arising hereunder, and any dispute that is not resolved by the Service
Coordinators within thirty (30) days shall be resolved in accordance with the
dispute resolution procedures set forth in Article VI of the Separation
Agreement. Each Party may treat an act of a Service Coordinator of the other
Party that is consistent with the provisions of this Agreement as being
authorized by such other Party without inquiring behind such act or ascertaining
whether such Service Coordinator had authority to so act; provided, however,
that no such Service Coordinator shall have authority to amend this Agreement.

 

(e)           Access; Books and Records. Each Service Recipient shall, for so
long as Services are being provided under this Agreement, provide its Service
Providers and their respective authorized representatives with reasonable
access, following any Service Provider’s request for such access provided in
writing no less than three (3) Business Days in advance, during normal business
hours, to such Service Recipient’s facilities, books and records to the extent
reasonably required to perform the Services.

 

(f)            Limitations; Resource Allocations. Service Recipients acknowledge
that Service Providers provide to themselves and other members of the Service
Provider Group services that are similar to the Services. Consequently, the
Service Provider may, from time to time, experience competing demands for its
various services. Accordingly, Service Recipients agree that Service Providers
may use reasonable discretion in prioritizing requests for service delivery
among the Service Recipient and other members of the Service Provider Group, in
each case consistent with past practices; provided that the Service Provider
communicates scheduling issues associated with the delivery of any particular
Service hereunder with the Service Coordinator for the Service Recipient Group,
and that the Service Provider makes reasonable efforts to accommodate the
Service Recipient’s requests for Services. No Service Provider shall be required
to add or retain staff, equipment, facilities or other resources in order to
provide any Service. With the prior written consent of the applicable Service
Recipient (which consent shall

 

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not be unreasonably withheld, declined or conditioned), the Service Provider
shall have the right to outsource all or portions of some Services to qualified
third-party subcontractors; provided that the Service Provider shall be
responsible for the costs of such third-party subcontractors.

 

(g)           Extension of Services; Cancellation of Services prior to
Expiration Date.

 

(i)            Each Services Annex shall set forth the duration of each Service
to be provided under this Agreement (the “Applicable Services Initial Term”) and
shall specify the duration, terms and conditions of any optional extension
periods beyond the Applicable Services Initial Term and the number of any such
extensions permitted. If any Service Recipient requests in accordance with the
applicable Services Annex that a Service Provider perform any Service beyond the
Applicable Services Initial Term (or the end of any extension thereof, if
applicable), the Service Provider shall be obligated to perform such Service for
the duration of the extension period as provided in the applicable Services
Annex.

 

(ii)           No Service Provider shall have any obligation to provide any
Service beyond the Applicable Services Initial Term, as such term may be
extended in accordance with Section 2.1(g)(i) (the end of such term, or the date
of earlier termination of the Services in accordance with Sections 2.1(g)(iii),
2.1(g)(iv) or 2.2(b), the “Applicable Services Termination Date”).

 

(iii)          Each Party shall have the option to terminate any one or more of
the Services provided by the other Party’s Group at any time prior to the
Applicable Services Termination Date(s); provided that such Party gives the
other Party at least forty-five (45) days’ prior written notice of its election
to exercise such option.

 

(iv)          Except as provided in Section 2.1(g)(v) below, if either Party
materially defaults on its obligations under this Agreement (including the
failure of any member of such Party’s Group to timely pay for Services in
accordance with this Agreement) and such default is not cured within thirty (30)
days of receipt of written notice of such default, the non-defaulting Party
shall have the right, at its sole discretion, to immediately terminate the
Services with respect to which the default occurred.

 

(v)           In the event that either Party shall (i) file a petition in
bankruptcy, (ii) become or be declared insolvent, or become the subject of any
proceedings (not dismissed within sixty (60) calendar days) related to its
liquidation, insolvency or the appointment of a receiver, (iii) make an
assignment on behalf of all or substantially all of its creditors, or (iv) take
any corporate action for its winding up or dissolution, then the other Party
shall have the right to terminate this Agreement by providing written notice to
the other Party.

 

(vi)          Each Service Provider’s obligation to provide Services to a member
of the Service Recipient’s Group shall terminate immediately if such Service
Recipient ceases to be a member of the Service Recipient’s Group.

 

(vii)         Following the Applicable Services Termination Date and except as
otherwise agreed to by the RemainCo Group and the SpinCo Group, neither Party
will be

 

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under any further obligation with respect to any Service so terminated; provided
that the Service Recipient will remain obligated for any Service Fees for the
terminated Service through the Applicable Services Termination Date and any
Direct Charges related to such Service.

 

(h)           Cooperation. RemainCo and SpinCo shall cooperate with one another
in good faith and provide such further assistance as the other Party may
reasonably request in connection with the provision of Services hereunder,
including with respect to any cooperation reasonably required to effect the
transition of any Service to the Service Recipient or its designated third-party
service provider following the Applicable Services Termination Date.

 

Section 2.2            Fees for Services.

 

(a)           Service Fees. Each Party shall pay to the other Party a monthly
fee (each a “Service Fee”) for each of the Services as specified on the
applicable Services Annex for each month up to and including the month in which
the Applicable Services Termination Date for each such Service occurs.
Notwithstanding the foregoing, if the Parties specifically agree in writing that
certain Service Fees shall be payable on other than a monthly basis, each such
Service Fee shall be payable on the basis agreed. The Service Fee for any
Additional Service, and any adjustment to a Service Fee in connection with a
mutually agreed change in the volume, nature or location of a Service, shall be
mutually agreed by the Parties prior to the date such Additional Services are
provided or such change becomes effective. The Service Recipient shall be
responsible for all applicable taxes imposed on the sale, performance, provision
or delivery of the Services, other than any taxes imposed on the Service
Provider’s income.

 

(b)           Adjustment to Service Fees. The Service Fee for each Service shall
be subject to increase (i) to the extent the cost to the Service Provider of
providing that Service increases due to higher costs imposed by third parties,
(ii) to the extent caused by an any change in the volume or quantity applicable
to any Services beyond that contemplated in the applicable Services Annex, and
(iii) in the event of modifications to the systems, processes, physical or
technical environment or level of trained personnel at the Service Recipient’s
facility; provided, that any such increase to any Service Fees shall be
negotiated and agreed in good faith by the Service Coordinators no later than
thirty (30) days following written request from the applicable Service Provider
for such increase; provided, further, that the Service Recipient shall have the
right, in its sole discretion, to terminate the Services subject to the Service
Fee increase upon written notice delivered no later than five (5) Business Days
following receipt of notice of such Service Fee increase. Notwithstanding the
foregoing, the Service Provider shall bear any additional costs arising from
(i) retention of consultants for the migration of software or applications to an
existing or new platform, or any improvement or modification thereto, (ii) the
Service Recipient’s decision to outsource any of its management information
system functions and (iii) any requirement for additional disk space or
increased processing capability.

 

(c)           Direct Charges. In addition to the fees set forth above, and
except as may otherwise be set forth in any Ancillary Agreement, to the extent
practicable, the following items will be directly charged to the Service
Recipient (“Direct Charges”): (1) all third-party expenses directly related to
the Service Recipient, including, but not limited to, outside legal fees,
outside accounting fees, and fees and expenses of external advisors and
consultants, (2) costs associated

 

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with any telecommunications contracts or information service licenses to the
extent related or arising out of the assignment of any such contracts or
licenses to the Service Recipient, and (3) insurance costs, including but not
limited to, general liability, automobile liability, comprehensive liability,
excess liability, property and directors and officers.

 

Section 2.3            Payment of Fees.

 

(a)           On or before the 15th day of each month during the term of this
Agreement, each Service Provider shall make a diligent effort to submit to the
each Service Recipient an invoice for the Services provided hereunder during the
immediately preceding calendar month. Except for amounts being disputed by any
Service Recipient in good faith in accordance with Section 2.5, each Service
Recipient shall remit payment within ten (10) days after the receipt of such
invoice. Notwithstanding the foregoing, unless and until payment has not been
received within thirty (30) days of receipt of the applicable invoice, the
Service Provider shall not be entitled to suspend or terminate the Services
related to the unpaid amounts. Unless otherwise agreed to in writing, each
Service Recipient shall remit all funds due under this Agreement to each Service
Provider either by wire transfer or Automated Clearing House (ACH) in
immediately available funds. Each Party’s wiring instructions shall be provided
to the other Party in writing (each Party may revise these from time to time
upon notice to the other Party).

 

(b)           To the extent reasonably practicable, all third-party invoices for
Direct Charges shall be promptly submitted to the applicable Service Recipient
for payment. For Direct Charges not paid directly by the Service Recipient, if
any, the Service Provider shall include such amounts in its monthly invoice to
the applicable Service Recipient.

 

Section 2.4            Records Maintenance and Audits. Each Service Recipient
shall, for so long as Services are being provided under this Agreement and for
two (2) years following the Expiration Date (or such longer period as required
by applicable Law), maintain records and other evidence sufficient to accurately
and properly reflect the performance of the Services hereunder and the amounts
due determined in accordance with Section 2.2. Service Recipients and their
applicable Service Coordinator and other representatives shall have reasonable
access to such records for the purpose of auditing and verifying the accuracy of
the invoices submitted regarding such amounts due, in accordance with the
provisions of Section 8.7 of the Separation Agreement. Any such audits shall be
at the sole cost and expense of the Service Recipient performing or requesting
such audits; provided that the costs associated with any audit that reveals an
overpayment of more than ten percent (10%) during the audit period shall be the
responsibility of the applicable Service Provider. The Service Recipient shall
have the right to audit the Service Provider’s books for a period of two
(2) years after the month in which the Services were rendered, except in those
circumstances where contracts by the Service Provider Group with third parties
limit the audit period to a shorter period.

 

Section 2.5            Disputed Amounts. In the event of a good-faith dispute as
to the amount and/or propriety of any invoices or any portions thereof submitted
pursuant to Section 2.3, if any, the applicable Service Recipient shall pay all
undisputed charges on such invoice, but shall be entitled to withhold payment of
any amount in dispute and shall promptly notify the applicable Service Provider
and Service Coordinator in writing of such disputed amounts and the reasons each
such charge is disputed. Upon written request, the Service Provider shall use
commercially

 

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reasonable efforts to provide the Service Recipient with sufficient records
relating to the disputed charge so as to enable the Parties to resolve the
dispute. In the event the Service Coordinators are unable to resolve the dispute
within thirty (30) days after the invoice becomes due, the matter shall be
resolved in accordance with the dispute resolution procedures set forth in
Article VI of the Separation Agreement. The Service Recipient shall remit
payment of the amount determined by agreement of the Service Providers or as a
result of the dispute resolution procedures to be properly payable not later
than ten (10) days following such determination, together with interest thereon
calculated daily at the Applicable Rate. In the event of any overpayments by the
Service Recipient, the Service Provider agrees to promptly refund any such
overpaid amount to the Service Recipient. So long as the Parties are attempting
in good faith to resolve the dispute, neither Party shall be entitled to
terminate the Services related to, or the cause of, the disputed amounts.

 

Section 2.6            Undisputed Amounts. Any statement or payment not disputed
in writing by either Party within one (1) year of the date of such statement or
payment shall, absent fraud or manifest error, be considered final and binding
and no longer subject to dispute or adjustment.

 

ARTICLE III.
CONFIDENTIALITY

 

Section 3.1            The Parties each acknowledge and agree that the terms of
Section 8.10 of the Separation Agreement shall apply to information, documents,
plans and other data made available or disclosed by one Party to the other in
connection with this Agreement.

 

Section 3.2            The provisions of this Article III shall survive for a
period of three (3) years following the expiration or termination of this
Agreement.

 

ARTICLE IV.
MISCELLANEOUS

 

Section 4.1            Termination. This Agreement shall terminate on the
Expiration Date, unless terminated earlier pursuant to Section 2.1(g).

 

Section 4.2            No Third-Party Beneficiaries. Except for the release and
indemnification rights and limitations of liability under Section 4.4 of this
Agreement which shall inure to the benefit of, and be enforceable by, the
members of each Party’s Service Provider Group and each of their respective
Affiliates, (a) the provisions of this Agreement are solely for the benefit of
the Parties hereto and are not intended to confer upon any Person (including,
without limitation, any stockholders of RemainCo or stockholders of SpinCo)
except the Parties hereto any rights or remedies hereunder; and (b) there are no
third-party beneficiaries of this Agreement, and this Agreement shall not
provide any third Person (including, without limitation, any stockholders of
RemainCo or stockholders of SpinCo) with any remedy, claim, liability,
reimbursement, claim of action or other right in excess of those existing
without reference to the Separation Agreement, this Agreement or any other
Ancillary Agreement.

 

Section 4.3            No Fiduciary Duties. It is expressly understood and
agreed that this Agreement is a purely commercial transaction between RemainCo
and SpinCo and that nothing stated herein shall operate to create any special or
fiduciary duty that either Party or any member

 

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of such Party’s Group or their respective Affiliates shall owe to the other
Party, any member of the other Party’s Group or their respective Affiliates, or
vice versa. Nothing stated herein shall obligate or require either Party or any
member of such Party’s Group to do anything which such Party deems to be
detrimental or injurious to any other business or commercial activities of
itself or any member of its Group or their respective Affiliates, and it is
expressly understood and agreed that each Service Provider shall be obliged to
exert only commercially reasonable efforts in providing Services hereunder.

 

Section 4.4            Limited Warranty; Limitation of Liability.

 

Each Party represents, on behalf of itself and each other member of such Party’s
Service Provider Group, that each Service Provider will use reasonable care in
providing Services to the members of the Service Recipient Group, and such
Services shall be provided by the applicable Service Provider in accordance with
all applicable Laws, rules, and regulations. EXCEPT AS SET FORTH IN THE
IMMEDIATELY PRECEDING SENTENCE AND IN SECTION 2.1(B), ALL SERVICES AND PRODUCTS
ARE RENDERED AND PROVIDED TO THE SERVICE RECIPIENTS AS IS, WHERE IS, WITH ALL
FAULTS, AND THE SERVICE PROVIDERS MAKE NO (AND HEREBY DISCLAIM AND NEGATE ANY
AND ALL) REPRESENTATIONS AND WARRANTIES, EXPRESS OR IMPLIED, INCLUDING THE
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, WITH RESPECT
TO THE SERVICES RENDERED OR PRODUCTS OBTAINED FOR THE SERVICE RECIPIENTS.
FURTHERMORE, THE SERVICE RECIPIENTS MAY NOT RELY UPON ANY REPRESENTATION OR
WARRANTY, EXPRESS OR IMPLIED, INCLUDING THE WARRANTIES OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE MADE TO THE SERVICE RECIPIENTS BY ANY PARTY
(INCLUDING AN AFFILIATE OF THE SERVICE PROVIDER GROUP) PERFORMING SERVICES ON
BEHALF OF THE SERVICE PROVIDER GROUP HEREUNDER, UNLESS SUCH PARTY MAKES AN
EXPRESS WARRANTY TO A SERVICE RECIPIENT.

 

IT IS EXPRESSLY UNDERSTOOD BY EACH PARTY, ON BEHALF OF ITSELF AND EACH OTHER
MEMBER OF THE SERVICE RECIPIENT GROUP, THAT THE SERVICE PROVIDER GROUP SHALL
HAVE NO LIABILITY FOR ANY SERVICES PROVIDED HEREUNDER AND FURTHER THAT THE
SERVICE PROVIDER GROUP SHALL HAVE NO LIABILITY WHATSOEVER FOR THE SERVICES
PROVIDED BY ANY THIRD PARTY, UNLESS IN EITHER EVENT SUCH SERVICES ARE PROVIDED
IN A MANNER THAT CONSTITUTES FRAUD, GROSS NEGLIGENCE OR WILLFUL MISCONDUCT ON
THE PART OF THE SERVICE PROVIDER OR ITS AFFILIATES. EACH PARTY AGREES THAT THE
REMUNERATION PAID TO THE SERVICE PROVIDER GROUP HEREUNDER FOR THE SERVICES TO BE
PERFORMED REFLECTS THIS LIMITATION OF LIABILITY AND DISCLAIMER OF WARRANTIES.
NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY, NEITHER THE SERVICE
PROVIDER GROUP NOR ITS AFFILIATES, ON THE ONE HAND, NOR THE SERVICE RECIPIENT
GROUP NOR ITS AFFILIATES, ON THE OTHER HAND, SHALL BE LIABLE UNDER THIS
AGREEMENT TO THE OTHER FOR ANY SPECIAL, INDIRECT, PUNITIVE, EXEMPLARY, REMOTE,
SPECULATIVE OR SIMILAR DAMAGES IN EXCESS OF COMPENSATORY DAMAGES.  OF THE OTHER
ARISING IN CONNECTION WITH ANY BREACH OF THIS AGREEMENT OR, IN THE CASE OF THE

 

10

--------------------------------------------------------------------------------

 

SERVICE PROVIDER GROUP AND ITS AFFILIATES, THE PERFORMANCE OF THE SERVICES
CONTEMPLATED HEREBY (OTHER THAN ANY SUCH LIABILITY WITH RESPECT TO A THIRD-PARTY
CLAIM), REGARDLESS OF THE FAULT OF THE SERVICE PROVIDER GROUP, OR ANY
THIRD-PARTY PROVIDER, OR WHETHER THE SERVICE PROVIDER GROUP, OR THE THIRD-PARTY
PROVIDER, ARE CONCURRENTLY, PARTIALLY, OR SOLELY NEGLIGENT. TO THE EXTENT ANY
THIRD-PARTY PROVIDER HAS LIMITED ITS LIABILITY TO THE SERVICE PROVIDER GROUP FOR
SERVICES UNDER AN OUTSOURCING OR OTHER AGREEMENT, THE APPLICABLE SERVICE
RECIPIENT AGREES TO BE BOUND BY SUCH LIMITATION OF LIABILITY FOR ANY PRODUCT OR
SERVICE PROVIDED TO THE SERVICE RECIPIENT BY SUCH THIRD-PARTY PROVIDER UNDER THE
APPLICABLE SERVICE PROVIDER’S AGREEMENT. EXCEPT IN CASES OF FRAUD, GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT, THE SERVICE PROVIDER GROUP’S COLLECTIVE
MAXIMUM LIABILITY TO THE SERVICE RECIPIENT GROUP WITH RESPECT TO ALL CLAIMS
ARISING OUT OF THIS AGREEMENT SHALL BE LIMITED IN THE AGGREGATE TO THE AMOUNT
PAYABLE HEREUNDER BY THE SERVICE RECIPIENT GROUP (EXCLUDING DIRECT CHARGES).

 

The Service Recipient Group shall assume all liability and shall further
release, indemnify and hold each member of the Service Provider Group and their
respective employees, officers, directors and agents free and harmless from and
against all losses resulting from, arising out of or related to (A) the
performance of the Services, however arising and whether or not caused by the
negligence of any member of the Service Provider Group or any third-party
provider, other than losses caused by the fraud, gross negligence or willful
misconduct of any member of the Service Provider Group or any third-party
provider or the material breach of this Agreement by any member of the Service
Provider Group or any third-party provider, (B) any material breach of this
Agreement by the Service Recipient Group or (C) the fraud, gross negligence or
willful misconduct of the Service Recipient Group.

 

The Service Provider Group shall assume all liability and shall further release,
indemnify and hold each member of the Service Recipient Group and their
respective employees, officers, directors and agents free and harmless from and
against all losses resulting from, arising out of or related to (A) the fraud,
gross negligence or willful misconduct of the Service Provider Group or any
third-party provider in the performance of or failure to perform the Services or
(B) any material breach of this Agreement by the Service Provider Group or any
third-party provider.

 

Section 4.5            Force Majeure. Neither Party shall be deemed in default
of this Agreement for failure to fulfill any obligation, other than a delay or
failure to make a payment, so long as and to the extent to which any delay or
failure in the fulfillment of such obligations is prevented, frustrated,
hindered or delayed as a consequence of circumstances of Force Majeure. In the
event of any such excused delay, the time for performance shall be extended for
a period equal to the time lost by reason of the delay. A Party claiming the
benefit of this provision shall, as soon as reasonably practicable after the
occurrence of any such event, (a) provide written notice to the other Party of
the nature and extent of any such Force Majeure condition; and (b) use
commercially reasonable efforts to remove any such causes and resume performance
under this Agreement, as applicable, as soon as reasonably practicable.

 

11

--------------------------------------------------------------------------------

 

Section 4.6            Insurance Matters. Each Party shall, to the extent
commercially reasonable, maintain insurance applicable to the Services and in
such type and amounts, and covering such risks, in each case as are customary
for businesses similar to the business of such Party.

 

Section 4.7            Further Assurances. In addition to the actions
specifically provided for elsewhere in this Agreement, each Party hereto shall
use its commercially reasonable efforts, prior to, on and after the Effective
Time, to take, or cause to be taken, all actions, and to do, or cause to be
done, all things reasonably necessary, proper or advisable on its part under
applicable Laws, regulations and agreements, to consummate and make effective
the transactions contemplated by this Agreement to provide the Services
hereunder and to perform such other additional acts as may be necessary or
appropriate to effectuate, carry out, and perform all of the terms and
provisions of this Agreement.

 

Section 4.8            Notices. All notices, requests, claims, demands or other
communications under this Agreement shall be in writing and shall be given or
made (and shall be deemed to have been duly given or made upon receipt) by
delivery in person, by overnight courier service, by facsimile or electronic
transmission with receipt confirmed (followed by delivery of an original via
overnight courier service), or by registered or certified mail (postage prepaid,
return receipt requested) to the respective Parties at the following addresses
(or at such other address for a Party as shall be specified in accordance with
this Section 4.8):

 

(a)                                 If to RemainCo, to:

 

Archrock, Inc.

16666 Northchase Dr.

Houston, Texas 77060

Attention: General Counsel

Fax:  (281) 836-8060

 

(b)                                 If to SpinCo, to:

 

Exterran Corporation

4444 Brittmoore Rd

Houston, Texas 77041

Attention: General Counsel

Fax:  (281) 836-8036

 

Any Party may, by notice to the other Party, change the address and contact
person to which any such notices are to be given.

 

Section 4.9            Counterparts. This Agreement may be executed in one or
more counterparts, all of which shall be considered one and the same agreement,
and shall become effective when one or more counterparts have been signed by
each Party hereto and delivered to each other Party. Each Party hereto
acknowledges that it and the other Party hereto may execute this Agreement by
facsimile, stamp or mechanical signature. Each Party hereto expressly adopts and
confirms each such facsimile, stamp or mechanical signature made in its
respective name as

 

12

--------------------------------------------------------------------------------

 

if it were a manual signature, agrees that it shall not assert that any such
signature is not adequate to bind such Party to the same extent as if it were
signed manually and agrees that at the reasonable request of any other Party
hereto at any time it shall as promptly as reasonably practicable cause this
Agreement to be manually executed (any such execution to be as of the date of
the initial date thereof).

 

Section 4.10         Governing Law. This Agreement (and any claims or disputes
arising out of or related hereto or to the transactions contemplated or to the
inducement of either Party to enter herein, whether for breach of contract,
tortious conduct or otherwise and whether predicated on common law, statute or
otherwise) shall be governed by and construed and interpreted in accordance with
the Laws of the State of Texas, irrespective of the choice of laws principles of
the State of Texas, including all matters of validity, construction, effect,
enforceability, performance and remedies.

 

Section 4.11         Dispute Resolution. Except as otherwise provided in
Section 2.1(d) or Section 2.5, the dispute resolution procedures set forth in
Article VI of the Separation Agreement shall apply to any dispute, controversy
or claim (whether sounding in contract, tort or otherwise) that arises out of or
relates to this Agreement, any breach or alleged breach hereof, the transactions
contemplated hereby (including all actions taken in furtherance of the
transactions contemplated hereby on or prior to the date hereof), or the
construction, interpretation, enforceability or validity hereof.

 

Section 4.12         Assignability. Except for the ability of any Service
Provider to cause one or more of the Services to be performed by a third-party
provider in accordance with Section 2.1(f) or an Affiliate of the Service
Provider, this Agreement shall be binding upon and inure to the benefit of the
Parties hereto and their respective successors and permitted assigns; provided,
however, that neither Party hereto may assign its respective rights or delegate
its respective obligations under this Agreement without the express prior
written consent of the other Party hereto.

 

Section 4.13         Severability. If any provision of this Agreement or the
application thereof to any Person or circumstance is determined by a court of
competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions hereof, or the application of such provision to Persons or
circumstances or in jurisdictions other than those as to which it has been held
invalid or unenforceable, shall remain in full force and effect and shall in no
way be affected, impaired or invalidated thereby. Upon such determination, the
Parties hereto shall negotiate in good faith in an effort to agree upon such a
suitable and equitable provision to effect the original intent of the Parties.

 

Section 4.14         Compliance with Law. Each Party, on behalf of itself and
such Party’s Service Recipient Group, represents and agrees that it will use the
Services provided hereunder only in accordance with all applicable Law, and in
accordance with the conditions, rules, regulations and specifications which may
be set forth in any manuals, materials, documents or instructions made available
or communicated by any Service Provider to any Service Recipient or any of its
Affiliates on an ongoing basis throughout the term of this Agreement. In
performing the Services, the Service Provider Group will comply with all
applicable Law. Each member of the Service Provider Group reserves the right to
take all actions, including termination of any

 

13

--------------------------------------------------------------------------------

 

particular Service or Services, that such Service Provider reasonably believes
to be necessary to assure compliance with applicable Law (including
specifically, but without limitation, any applicable antitrust Laws and
regulations); provided, however, that such Service Provider will endeavor to
provide the applicable Service Recipient with as much prior notice as is
reasonably practical before taking any such action.

 

Section 4.15         Amendments. No provisions of this Agreement shall be deemed
waived, amended, supplemented or modified by either Party, unless such waiver,
amendment, supplement or modification is in writing and signed by the authorized
representative of the Party against whom such waiver, amendment, supplement or
modification is sought to be enforced.

 

Section 4.16         Waivers of Default. Waiver by either Party of any default
by the other Party of any provision of this Agreement shall not be deemed a
waiver by the waiving Party of any subsequent or other default, nor shall it
prejudice the rights of such Party. No failure or delay by any Party in
exercising any right, power or privilege under this Agreement shall operate as a
waiver thereof nor shall a single or partial exercise thereof prejudice any
other or further exercise thereof or the exercise of any other right, power or
privilege.

 

Section 4.17         Entire Agreement. This Agreement, the Separation Agreement
and the other Ancillary Agreements, and the exhibits, annexes and schedules
hereto and thereto, contain the entire agreement between the Parties with
respect to the subject matter hereof, supersede all previous agreements,
negotiations, discussions, writings, understandings, commitments and
conversations with respect to such subject matter and there are no agreements or
understandings between the Parties with respect to such subject matter other
than those set forth or referred to herein or therein. In the case of any
conflict between the provisions of this Agreement and the Separation Agreement,
the provisions of this Agreement shall prevail.

 

Section 4.18         Survival. The Parties agree that any limitations on
liability or responsibility and any exculpatory, disclaimer, waiver or similar
provisions will survive the Expiration Date or any other termination of this
Agreement and that neither the Expiration Date nor any such termination shall
affect any obligation for the Service Fees for any terminated Services, in each
case performed or incurred prior to the Expiration Date or any other
termination.

 

[Signatures of Parties on Next Page]

 

14

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement with effect
as of the date first above written.

 

 

 

 

EXTERRAN HOLDINGS, INC.

 

 

 

 

 

 

By:

/s/ D. Bradley Childers

 

Name:

D. Bradley Childers

 

Title:

President

 

 

 

 

 

 

 

EXTERRAN CORPORATION

 

 

 

 

 

 

 

By:

/s/ Andrew J. Way

 

Name:

Andrew J. Way

 

Title:

President

 

Signature Page to Transition Services Agreement

 

--------------------------------------------------------------------------------

 

Annex A

RemainCo Services

 

 

 

 

 

 

 

 

 

Cost / Month

 

Suggested Extension Options

 

Cumulative
Cost

 

 

 

Function

 

Scope

 

Duration
(Months)

 

(Dollars in
Thousands)

 

Classification

 

Duration
(Months)

 

Extensions

 

(Dollars in
Thousands)

 

R1

 

Accounting

 

SEC Reporting Short Term Support

 

5.0

 

0.0

 

Reporting

 

1

 

1

 

—

 

R2

 

Accounting

 

Fixed Asset Accounting Support

 

4.0

 

0.0

 

Reporting

 

1

 

1

 

—

 

R3

 

Accounting

 

Corporate Accounting Short Term Support Carve-out Financials and 10Q

 

1.0

 

0.0

 

Reporting

 

1

 

1

 

—

 

R4

 

Accounting

 

North America Accounting

 

4.0

 

0.0

 

Reporting

 

1

 

1

 

—

 

R5

 

Accounting

 

SpinCo - Opening balance sheet

 

4.0

 

0.0

 

Reporting

 

1

 

1

 

—

 

R6

 

Accounting

 

New Role Transition - Shared Services Manager transition

 

3.0

 

0.0

 

Knowledge Transfer

 

1

 

1

 

—

 

R7

 

Accounting

 

Accounts Receivable

 

4.0

 

0.0

 

Operational Support

 

3

 

1

 

—

 

R8

 

Accounting

 

BlackLine system administrator and system stand-up

 

4.0

 

0.0

 

Operational Support

 

3

 

1

 

—

 

R9

 

Accounting

 

New Role Transition - Supervisor of iExpense

 

3.0

 

0.0

 

Knowledge Transfer

 

1

 

1

 

—

 

R10

 

Accounting

 

Shared Services - Billing

 

3.0

 

0.0

 

Knowledge Transfer

 

1

 

1

 

—

 

R11

 

Accounting

 

Accounts Payable and Disbursements

 

3.0

 

0.0

 

Knowledge Transfer

 

1

 

1

 

—

 

R13

 

Accounting

 

LTI / stock-based compensation diclosure reporting

 

17.0

 

0.0

 

Operational Support

 

0

 

0

 

—

 

R14

 

Accounting

 

LTI / stock-based compensation expense reporting

 

17.0

 

0.0

 

Operational Support

 

0

 

0

 

—

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

 

 

Cost / Month

 

Suggested Extension Options

 

Cumulative
Cost

 

 

 

Function

 

Scope

 

Duration
(Months)

 

(Dollars in
Thousands)

 

Classification

 

Duration
(Months)

 

Extensions

 

(Dollars in
Thousands)

 

R15

 

Accounting

 

LTI / stock-based compensation grant and vesting cycle support

 

5.0

 

0.0

 

Operational Support

 

3

 

1

 

—

 

R16

 

Tax

 

Income Tax Reporting - State Income Tax

 

14.0

 

1.0

 

Operational Support

 

0

 

0

 

14

 

R17

 

Tax

 

Income Tax Reporting - Tax Fixed Assets

 

11.0

 

3.2

 

Operational Support

 

3

 

1

 

35

 

R18

 

Tax

 

Income Tax Reporting — Q4 SEC Tax Disclosures

 

5.0

 

1.5

 

Operational Support

 

3

 

1

 

8

 

R19

 

Tax

 

Income Tax Reporting - OneSource and Corptax

 

12.0

 

0.5

 

Operational Support

 

0

 

0

 

6

 

R20

 

Tax

 

Income Tax Reporting - State Apportionment Calculations

 

12.0

 

0.8

 

Operational Support

 

0

 

0

 

9

 

R21

 

Tax

 

Ad Valorem Tax

 

12.0

 

1.9

 

Operational Support

 

0

 

0

 

23

 

R22

 

Tax

 

Sales & Use Tax Audits

 

24.0

 

1.7

 

Operational Support

 

0

 

0

 

40

 

R23

 

Tax

 

Sales Tax Systems

 

6.0

 

5.2

 

Operational Support

 

3

 

1

 

31

 

R24

 

BT

 

Mobile Device Management Services

 

3.0

 

1.2

 

Critical Infrastructure

 

3

 

2

 

4

 

R25

 

BT

 

Conferencing Services

 

6.0

 

3.1

 

Critical Infrastructure

 

3

 

2

 

18

 

R26

 

BT

 

Citrix Support Services

 

6.0

 

3.1

 

Critical Infrastructure

 

3

 

2

 

18

 

R27

 

BT

 

Oracle Manufacturing Support

 

6.0

 

6.1

 

Critical Infrastructure

 

3

 

2

 

37

 

R28

 

Treasury

 

Commingled Collections and Cash Applications

 

12.0

 

0.6

 

Operational Support

 

0

 

0

 

8

 

R29

 

Treasury

 

AR Periodic Settling

 

12.0

 

0.0

 

Operational Support

 

0

 

0

 

—

 

R30

 

Treasury

 

Payments in error tracking

 

12.0

 

0.6

 

Operational Support

 

0

 

0

 

8

 

R31

 

Treasury

 

AP Periodic Settling

 

12.0

 

0.0

 

Operational Support

 

0

 

0

 

—

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

 

 

Cost / Month

 

Suggested Extension Options

 

Cumulative
Cost

 

 

 

Function

 

Scope

 

Duration
(Months)

 

(Dollars in
Thousands)

 

Classification

 

Duration
(Months)

 

Extensions

 

(Dollars in
Thousands)

 

R32

 

Treasury

 

Cash Management / Cash Reconciliation / Training

 

6.0

 

1.6

 

Operational Support

 

3

 

1

 

9

 

R33

 

Treasury

 

Cash Applications Support / Training

 

6.0

 

1.6

 

Operational Support

 

3

 

1

 

9

 

R34

 

Treasury

 

Treasury Management

 

6.0

 

1.6

 

Operational Support

 

3

 

1

 

9

 

R35

 

HR

 

Payroll Services

 

6.0

 

13.2

 

Operational Support

 

3

 

1

 

79

 

R36

 

HR

 

Benefit Services

 

5.0

 

6.6

 

Operational Support

 

3

 

1

 

33

 

R37

 

HR

 

Compensation Services

 

6.0

 

3.3

 

Operational Support

 

3

 

1

 

20

 

R38

 

HR

 

HRIS Services (HR Services, Reporting and Systems)

 

5.0

 

6.6

 

Operational Support

 

3

 

1

 

33

 

R39

 

HR

 

HR Programs Services

 

5.0

 

6.6

 

Operational Support

 

3

 

1

 

33

 

R40

 

HR

 

Engagement

 

5.0

 

6.6

 

Operational Support

 

3

 

1

 

33

 

R41

 

HR

 

Corporate Communications Support

 

5.0

 

0.7

 

Knowledge Transfer

 

1

 

1

 

3

 

R43

 

Legal

 

Litigation case management and training

 

6.0

 

5.6

 

Operational Support

 

3

 

1

 

34

 

R44

 

Legal

 

Corporate Secretary

 

12.0

 

1.4

 

Operational Support

 

0

 

0

 

16

 

R45

 

Real Estate

 

Broussard Services

 

3.0

 

5.5

 

Operational Support

 

3

 

1

 

17

 

R46

 

Real Estate

 

Real Estate Acquisitions Support

 

6.0

 

2.0

 

Operational Support

 

3

 

1

 

12

 

R47

 

Real Estate

 

Real Estate Construction Support

 

3.0

 

1.3

 

Operational Support

 

3

 

1

 

4

 

R48

 

Sales

 

Advanced Pricing

 

6.0

 

5.4

 

Knowledge Transfer

 

1

 

1

 

32

 

R49

 

Sales

 

Commissions Calculations

 

1.0

 

2.7

 

Knowledge Transfer

 

1

 

1

 

3

 

R50

 

Fleet

 

Fleet Utilization Reporting

 

3.0

 

1.8

 

Knowledge Transfer

 

1

 

1

 

5

 

R51

 

Fleet

 

EAM and EAM Reports

 

3.0

 

1.8

 

Knowledge Transfer

 

1

 

1

 

5

 

R52

 

HSE

 

Claims management knowledge transfer and support

 

6.0

 

5.8

 

Knowledge Transfer

 

1

 

1

 

35

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

 

 

Cost / Month

 

Suggested Extension Options

 

Cumulative
Cost

 

 

 

Function

 

Scope

 

Duration
(Months)

 

(Dollars in
Thousands)

 

Classification

 

Duration
(Months)

 

Extensions

 

(Dollars in
Thousands)

 

R53

 

HSE

 

Customer database management knowledge transfer and support

 

6.0

 

2.3

 

Knowledge Transfer

 

1

 

1

 

14

 

R54

 

PEQ

 

PEQ Equipment Storage

 

6.0

 

7.8

 

Operational Support

 

3

 

1

 

47

 

R55

 

PEQ

 

PEQ Facility Access

 

6.0

 

0.0

 

Operational Support

 

3

 

1

 

—

 

R56

 

PEQ

 

PEQ Transitional Operational Support

 

3.0

 

9.1

 

Operational Support

 

3

 

1

 

27

 

R57

 

PEQ

 

Storage of PEQ Fabricated Inventory at Archrock Locations

 

3.0

 

0.0

 

Operational Support

 

3

 

1

 

—

 

R58

 

Intl Services

 

ODC parts shipment support

 

2.0

 

3.4

 

Operational Support

 

3

 

1

 

7

 

R59

 

Intl Services

 

EAM and Advance pricing Application Support and Training

 

6.0

 

18.3

 

Operational Support

 

3

 

1

 

110

 

R60

 

Intl Services

 

Training tracker knowledge transfer

 

3.0

 

3.1

 

Knowledge Transfer

 

1

 

1

 

9

 

R61

 

Accounting

 

EPS calculation support - SpinCo

 

5.0

 

0.0

 

Operational Support

 

3

 

1

 

—

 

R62

 

Accounting

 

Shared Services — Billing

 

3.0

 

0.0

 

Operational Support

 

3

 

1

 

—

 

R63

 

Accounting

 

Warranty Services

 

3.0

 

0.0

 

Operational Support

 

3

 

1

 

—

 

R64

 

Accounting

 

Continuing Professional Education

 

4.0

 

0.0

 

Operational Support

 

3

 

1

 

—

 

R65

 

Fleet

 

CAPEX/OPEX Approvals

 

3.0

 

1.8

 

Operational Support

 

3

 

1

 

5

 

R66

 

HR

 

HR Administrative Support and File Management

 

3.0

 

6.6

 

Operational Support

 

3

 

1

 

20

 

R67

 

BT

 

CSG

 

12.0

 

6.6

 

Operational Support

 

0

 

0

 

79

 

R68

 

BT

 

Security Services

 

1.0

 

2.4

 

Operational Support

 

3

 

1

 

2

 

R69

 

BT

 

Application (non Oracle)

 

3.0

 

2.4

 

Operational Support

 

3

 

1

 

7

 

R70

 

Legal

 

Litigation support (eDiscovery)

 

6.0

 

2.1

 

Operational Support

 

3

 

1

 

13

 

R71

 

Supply Chain

 

Buyer and Inventory support

 

3.0

 

8.3

 

Operational Support

 

3

 

1

 

25

 

R72

 

Treasury

 

Insurance services

 

6.0

 

.6

 

Operational Support

 

3

 

1

 

4

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

 

 

Cost / Month

 

Suggested Extension Options

 

Cumulative
Cost

 

 

 

Function

 

Scope

 

Duration
(Months)

 

(Dollars in
Thousands)

 

Classification

 

Duration
(Months)

 

Extensions

 

(Dollars in
Thousands)

 

R72

 

Tax

 

Income Tax Reporting — ASC 718 SEC Tax Disclosures

 

18.0

 

.4

 

Reporting

 

0

 

0

 

7

 

 

Annex B

SpinCo Services

 

 

 

 

 

 

 

 

 

Cost /
Month

 

Suggested Extension Options

 

Cumulative Cost

 

 

 

Function

 

Scope

 

Duration (Months)

 

(Dollars in Thousands)

 

Classification

 

Duration (Months)

 

Number of Extensions

 

(Dollars in Thousands)

 

T1

 

Accounting

 

Latin America Accounting — Corporate

 

0.8

 

0.0

 

Reporting

 

1

 

1

 

—

 

T2

 

Accounting

 

Latin America Accounting - in country

 

0.8

 

0.0

 

Reporting

 

1

 

1

 

—

 

T3

 

Accounting

 

Eastern Hemisphere Accounting — Corporate

 

0.8

 

0.0

 

Reporting

 

1

 

1

 

—

 

T4

 

Accounting

 

Eastern Hemisphere Accounting - in country

 

0.8

 

0.0

 

Reporting

 

1

 

1

 

—

 

T5

 

Accounting

 

Manufacturing Accounting

 

0.8

 

0.0

 

Reporting

 

1

 

1

 

—

 

T6

 

Accounting

 

SEC Reporting Short Term Support

 

0.5

 

0.0

 

Reporting

 

1

 

1

 

—

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

 

 

Cost /
Month

 

Suggested Extension Options

 

Cumulative Cost

 

 

 

Function

 

Scope

 

Duration (Months)

 

(Dollars in Thousands)

 

Classification

 

Duration (Months)

 

Number of Extensions

 

(Dollars in Thousands)

 

T7

 

Accounting

 

Fixed Asset Accounting Support

 

0.8

 

0.0

 

Reporting

 

1

 

1

 

—

 

T8

 

Accounting

 

Corporate Accounting Short-Term Support

 

0.8

 

0.0

 

Reporting

 

1

 

1

 

—

 

T9

 

Accounting

 

Corporate Accounting Short Term Support RemainCo Pro-forma 8K

 

1.5

 

0.0

 

Reporting

 

1

 

1

 

—

 

T10

 

Accounting

 

Disco - Corporate Accounting

 

4.0

 

0.0

 

Reporting

 

1

 

1

 

—

 

T11

 

Accounting

 

Disco - SEC Reporting

 

4.0

 

0.0

 

Reporting

 

1

 

1

 

—

 

T12

 

Accounting

 

RemainCo - Opening balance sheet

 

4.0

 

0.0

 

Reporting

 

1

 

1

 

—

 

T13

 

Accounting

 

New Role Transition -Accounting SME for Oracle, Hyperion and Essbase

 

4.0

 

0.0

 

Knowledge Transfer

 

1

 

1

 

—

 

T14

 

Accounting

 

Open Role - Fixed Asset Supervisor at RemainCo

 

4.0

 

0.0

 

Knowledge Transfer

 

1

 

1

 

—

 

T15

 

Accounting

 

EPS calculation support — RemainCo

 

5.0

 

0.0

 

Reporting

 

1

 

1

 

—

 

T17

 

Accounting

 

Capital Project management and maintenance function

 

4.0

 

0.0

 

Operational Support

 

3

 

1

 

—

 

T18

 

Accounting

 

BlackLine system administrator and system stand-up

 

4.0

 

0.0

 

Operational Support

 

3

 

1

 

—

 

T19

 

Accounting

 

New Role Transition - Accounts Payable Supervisor

 

3.0

 

0.0

 

Operational Support

 

3

 

1

 

—

 

T20

 

Accounting

 

Shared Services — Billing

 

3.0

 

0.0

 

Operational Support

 

3

 

1

 

—

 

T22

 

Accounting

 

LTI / stock-based compensation diclosure reporting

 

17.0

 

0.0

 

Operational Support

 

0

 

0

 

—

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

 

 

Cost /
Month

 

Suggested Extension Options

 

Cumulative Cost

 

 

 

Function

 

Scope

 

Duration (Months)

 

(Dollars in Thousands)

 

Classification

 

Duration (Months)

 

Number of Extensions

 

(Dollars in Thousands)

 

T23

 

Accounting

 

LTI / stock-based compensation expense reporting

 

17.0

 

0.0

 

Operational Support

 

0

 

0

 

—

 

T24

 

BT

 

Access Management Services

 

3.0

 

2.4

 

Critical Infrastructure

 

3

 

2

 

7

 

T25

 

BT

 

Email Forwarding Services

 

6.0

 

2.4

 

Critical Infrastructure

 

3

 

2

 

15

 

T26

 

BT

 

Email Hosting Services

 

6.0

 

1.2

 

Critical Infrastructure

 

3

 

2

 

7

 

T27

 

BT

 

Directory Services

 

12.0

 

1.2

 

Critical Infrastructure

 

0

 

0

 

15

 

T28

 

BT

 

Directory Trust Services

 

12.0

 

1.2

 

Critical Infrastructure

 

0

 

0

 

15

 

T29

 

BT

 

Domain Name Services

 

3.0

 

1.2

 

Critical Infrastructure

 

3

 

2

 

4

 

T30

 

BT

 

Telephone and voicemail forwarding services - Voice

 

3.0

 

2.4

 

Critical Infrastructure

 

3

 

2

 

7

 

T31

 

BT

 

Telephone and voicemail hosting services - Voice

 

3.0

 

2.4

 

Critical Infrastructure

 

3

 

2

 

7

 

T32

 

BT

 

Network Services

 

12.0

 

5.1

 

Critical Infrastructure

 

0

 

0

 

61

 

T33

 

BT

 

Remote Access

 

12.0

 

3.1

 

Critical Infrastructure

 

0

 

0

 

37

 

T34

 

BT

 

SharePoint

 

6.0

 

3.1

 

Critical Infrastructure

 

3

 

2

 

18

 

T35

 

BT

 

Packaged Desktop Applications Support

 

6.0

 

1.2

 

Critical Infrastructure

 

3

 

2

 

7

 

T36

 

BT

 

System Center & Monitoring Support Services

 

6.0

 

3.1

 

Critical Infrastructure

 

3

 

2

 

18

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

 

 

Cost /
Month

 

Suggested Extension Options

 

Cumulative Cost

 

 

 

Function

 

Scope

 

Duration (Months)

 

(Dollars in Thousands)

 

Classification

 

Duration (Months)

 

Number of Extensions

 

(Dollars in Thousands)

 

T37

 

BT

 

Server and Storage

 

6.0

 

1.2

 

Critical Infrastructure

 

3

 

2

 

7

 

T38

 

BT

 

Oracle Operations Support

 

6.0

 

6.1

 

Critical Infrastructure

 

3

 

2

 

37

 

T40

 

BT

 

Controls & Compliance

 

3.0

 

4.9

 

Critical Infrastructure

 

3

 

2

 

15

 

T41

 

BT

 

Change Management

 

3.0

 

6.1

 

Critical Infrastructure

 

3

 

2

 

18

 

T42

 

BT

 

Data Restoration

 

1.0

 

1.2

 

Critical Infrastructure

 

3

 

2

 

1

 

T44

 

HR

 

HR Corporate Strategy Support

 

9.0

 

6.6

 

Operational Support

 

3

 

1

 

60

 

T45

 

HR

 

HR Operations Management Support

 

6.0

 

6.6

 

Operational Support

 

3

 

1

 

40

 

T46

 

HR

 

HR Business Unit Partner Support

 

3.0

 

3.3

 

Operational Support

 

3

 

1

 

10

 

T48

 

HR

 

HR Programs Services

 

5.0

 

6.6

 

Operational Support

 

3

 

1

 

33

 

T49

 

HR

 

HRIS Services (HR Services, Reporting and Systems)

 

5.0

 

13.2

 

Operational Support

 

3

 

1

 

66

 

T50

 

HR

 

Recruiting Services

 

6.0

 

13.2

 

Operational Support

 

3

 

1

 

79

 

T51

 

HR

 

Payroll Services

 

8.0

 

19.9

 

Operational Support

 

3

 

1

 

159

 

T52

 

HR

 

Benefit Services

 

3.0

 

6.6

 

Operational Support

 

3

 

1

 

20

 

T53

 

HR

 

Compensation Services

 

9.0

 

19.9

 

Operational Support

 

3

 

1

 

179

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

 

 

Cost /
Month

 

Suggested Extension Options

 

Cumulative Cost

 

 

 

Function

 

Scope

 

Duration (Months)

 

(Dollars in Thousands)

 

Classification

 

Duration (Months)

 

Number of Extensions

 

(Dollars in Thousands)

 

T56

 

HR

 

Corporate Communications Support

 

3.0

 

0.7

 

Knowledge Transfer

 

1

 

1

 

2

 

T58

 

Legal

 

Trade Control: Sanctions Compliance

 

9.0

 

0.85

 

Operational Support

 

3

 

1

 

8

 

T59

 

Legal

 

Import Compliance Support

 

9.0

 

1.28

 

Knowledge Transfer

 

1

 

1

 

11

 

T60

 

Legal

 

Compliance Reporting

 

10.0

 

13.11

 

Operational Support

 

3

 

1

 

6

 

T61

 

Legal

 

Trade Control: Boycott Compliance

 

8.0

 

0.17

 

Operational Support

 

3

 

1

 

1

 

T62

 

Legal

 

Trade Control: Restricted Party List Review

 

9.0

 

0.85

 

Operational Support

 

3

 

1

 

8

 

T63

 

Legal

 

Trade compliance oversight and training

 

9.0

 

6.70

 

Operational Support

 

3

 

1

 

60

 

T64

 

Legal

 

Internal Audit - BT SOX audit services

 

9.0

 

4.92

 

Operational Support

 

3

 

1

 

44

 

T65

 

Legal

 

Equity Plan Administration

 

7.0

 

4.26

 

Operational Support

 

3

 

1

 

30

 

T66

 

Tax

 

Income Tax Reporting - Federal Income Tax

 

11.0

 

2.3

 

Operational Support

 

3

 

1

 

26

 

T67

 

Tax

 

Income Tax Reporting - State Income Tax

 

14.0

 

0.9

 

Operational Support

 

0

 

0

 

12

 

T68

 

Tax

 

Income Tax Reporting - Amendments

 

24.0

 

0.3

 

Operational Support

 

0

 

0

 

8

 

T69

 

Tax

 

Income Tax Reporting - Amendments State

 

24.0

 

1.0

 

Operational Support

 

0

 

0

 

23

 

T70

 

Tax

 

Income Tax Reporting — Q3 SEC Tax Disclosures

 

2.0

 

22.5

 

Operational Support

 

3

 

1

 

45

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

 

 

Cost /
Month

 

Suggested Extension Options

 

Cumulative Cost

 

 

 

Function

 

Scope

 

Duration (Months)

 

(Dollars in Thousands)

 

Classification

 

Duration (Months)

 

Number of Extensions

 

(Dollars in Thousands)

 

T71

 

Tax

 

Income Tax Reporting — Q4 SEC Tax Disclosures

 

4.0

 

4.6

 

Operational Support

 

3

 

1

 

19

 

T72

 

Tax

 

Income Tax Reporting - OneSource and Corptax

 

12.0

 

0.5

 

Operational Support

 

0

 

0

 

6

 

T73

 

Tax

 

Income Tax Reporting - State Apportionment Calculations

 

12.0

 

2.1

 

Operational Support

 

0

 

0

 

25

 

T74

 

Tax

 

Income Tax Audits

 

24.0

 

1.6

 

Operational Support

 

0

 

0

 

39

 

T75

 

Tax

 

Sales & Use Tax Audits

 

24.0

 

0.4

 

Operational Support

 

0

 

0

 

10

 

T76

 

Tax

 

Use Tax Audits

 

24.0

 

0.4

 

Operational Support

 

0

 

0

 

9

 

T77

 

FP&A

 

Essbase/Hyperion Support and Training

 

6.0

 

1.5

 

Knowledge Transfer

 

1

 

1

 

9

 

T78

 

FP&A

 

IR Support and Training

 

6.0

 

7.7

 

Knowledge Transfer

 

1

 

1

 

46

 

T79

 

FP&A

 

Budget and financial planning follow up support

 

6.0

 

1.5

 

Knowledge Transfer

 

1

 

1

 

9

 

T80

 

Treasury

 

Commingled Collections and Cash Applications

 

12.0

 

0.6

 

Operational Support

 

0

 

0

 

8

 

T81

 

Treasury

 

AR Periodic Settling

 

12.0

 

0.0

 

Operational Support

 

0

 

0

 

—

 

T82

 

Treasury

 

Payments in error tracking

 

12.0

 

0.6

 

Operational Support

 

0

 

0

 

8

 

T83

 

Treasury

 

AP Periodic Settling

 

12.0

 

0.0

 

Operational Support

 

0

 

0

 

—

 

T84

 

Treasury

 

Cash Management / Cash Reconciliation / Training

 

6.0

 

1.6

 

Operational Support

 

3

 

1

 

9

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

 

 

Cost /
Month

 

Suggested Extension Options

 

Cumulative Cost

 

 

 

Function

 

Scope

 

Duration (Months)

 

(Dollars in Thousands)

 

Classification

 

Duration (Months)

 

Number of Extensions

 

(Dollars in Thousands)

 

T85

 

Treasury

 

Cash Applications Support / Training

 

6.0

 

1.6

 

Knowledge Transfer

 

1

 

1

 

9

 

T86

 

Sales

 

Commissions Calculations

 

1.0

 

2.7

 

Operational Support

 

3

 

1

 

3

 

T87

 

Real Estate

 

Broken Arrow

 

3.0

 

1.7

 

Operational Support

 

3

 

1

 

5

 

T90

 

HSE

 

Intelex, Xact, Sys Ad knowledge transfer and support

 

6.0

 

5.8

 

Knowledge Transfer

 

1

 

1

 

35

 

T91

 

NA Ops

 

Windrock knowledge transfer and training

 

6.0

 

6.1

 

Knowledge Transfer

 

1

 

1

 

37

 

T93

 

NA Ops

 

Service Manager North America Operations

 

12.0

 

12.5

 

Operational Support

 

0

 

0

 

150

 

T94

 

NA Ops

 

South TX NAOps Support

 

12.0

 

8.3

 

Operational Support

 

0

 

0

 

100

 

T95

 

Accounting

 

Latin America Accounting - Corporate - Year End and Audit Support

 

4.0

 

0.0

 

Reporting

 

1

 

1

 

—

 

T96

 

Accounting

 

Latin America Accounting - in country - Year End and Audit Support

 

4.0

 

0.0

 

Reporting

 

1

 

1

 

—

 

T97

 

Accounting

 

Eastern Hemisphere Accounting - Corporate - Year End and Audit Support

 

4.0

 

0.0

 

Reporting

 

1

 

1

 

—

 

T98

 

Accounting

 

Eastern Hemisphere Accounting - in country - Year End and Audit Support

 

4.0

 

0.0

 

Reporting

 

1

 

1

 

—

 

T99

 

Accounting

 

Manufacturing Accounting - Year End and Audit Support

 

4.0

 

0.0

 

Reporting

 

1

 

1

 

—

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

 

 

Cost /
Month

 

Suggested Extension Options

 

Cumulative Cost

 

 

 

Function

 

Scope

 

Duration (Months)

 

(Dollars in Thousands)

 

Classification

 

Duration (Months)

 

Number of Extensions

 

(Dollars in Thousands)

 

T100

 

Accounting

 

Fixed Asset Accounting Support - Year End and Audit Support

 

4.0

 

0.0

 

Reporting

 

1

 

1

 

—

 

T101

 

Accounting

 

Corporate Accounting Year-end and Audit Support

 

1.0

 

0.0

 

Reporting

 

1

 

1

 

—

 

T102

 

Accounting

 

AMS Contract Compression Installation

 

3.0

 

0.0

 

Operational Support

 

3

 

1

 

—

 

T103

 

Accounting

 

CAO and Controller functionality

 

4.0

 

0.0

 

Operational Support

 

3

 

1

 

—

 

T104

 

Legal

 

Litigation support (eDiscovery)

 

6.0

 

.5

 

Operational Support

 

3

 

1

 

3

 

T105

 

Legal

 

Records Management

 

3.0

 

0.5

 

Operational Support

 

3

 

1

 

2

 

T106

 

Legal

 

Heavy Equipment Litigation

 

12.0

 

0.3

 

Operational Support

 

0

 

0

 

3

 

T107

 

Operations

 

Operations support services

 

6.0

 

10.2

 

Operational Support

 

3

 

1

 

61

 

T108

 

Engineering

 

Engineering support services

 

12.0

 

11.4

 

Operational Support

 

0

 

0

 

137

 

T109

 

BT

 

Database

 

6.0

 

3.1

 

Operational Support

 

3

 

1

 

18

 

T110

 

Treasury

 

Risk Management support

 

6.0

 

2.1

 

Operational Support

 

3

 

1

 

12

 

T111

 

Tax

 

Income Tax Reporting — ASC 718 SEC Tax Disclosures

 

18.0

 

.4

 

Reporting

 

0

 

0

 

7

 

 

--------------------------------------------------------------------------------

 

Annex C

Service Coordinators

 

RemainCo — Paul Burkart

 

Spinco — Michael Bent

 

--------------------------------------------------------------------------------