SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT
OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY
SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN
MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

Exhibit 10.1

FIRST AMENDMENT TO SAND STORAGE AND TRANSLOAD AGREEMENT

AGREEMENT ID: CW2238264

THIS FIRST AMENDMENT TO SAND STORAGE AND TRANSLOAD AGREEMENT ( “Amendment 1”)
made as of December 17, 2018 (the “Execution Date”), by and between Solaris
Logistics, LLC (“Contractor”) and Devon Energy Production Company, L.P.
(“Company”).  Contractor and Company may each be referred to herein as a “Party”
or collectively as “Parties”.

RECITALS

A.Whereas, Contractor and Company entered into that certain Sand Storage and
Transload Agreement (the “Agreement”) dated as of July 27, 2017, pursuant to
which Contractor agreed to provide certain storage and transloading services to
Company; and

B.Whereas, in consideration of Company paying to Contractor a partial early
termination fee (the “Partial Termination Fee”) in the amount of twenty-five
million nine hunder eighty thousand dollars ($25,980,000), Contractor and
Company desire to amend the Agreement in several respects, including, without
limitation, reducing the Storage Facilities Minimum Volume Commitment and
modifying the early termination provision of the Agreement.

The Parties agree and acknoweledge that neither party is obgliated to enter into
this First Amendment and is not in breach of the Agreement as of the Execution
Date.

NOW, THEREFORE, Company and Contractor agreed to amend the Agreement as provided
herein.

 

AGREEMENT

1.DEFINITIONS.  All references in the Amendment to the “Agreement” shall be
deemed references to the Agreement, as amended by this Amendment.  Capitalized
terms not otherwise defined herein shall have the meanings ascribed in the
Agreement.

2.PARTIAL TERMINATION FEE

Upon receipt of Contractor’s invoice, Company shall pay the Partial Early
Termination Fee to Contractor in accordance with Section 3(D) within thirty (30)
days.

3.AGREEMENT TERM.  The definition of “Initial Term” in Section 1 of the
Agreement is hereby deleted in its entirety and replaced with the following:

“The Initial Term shall be for a period of three (3) years following the
Effective Date and shall expire on December 31, 2020 (the “Initial Term”).”  All
other provisions of Section 1 shall remain unchanged.”

4. EARLY TERMINATION.

A.Company shall have the right to terminate this Agreement upon *** days prior
written notice to Contractor. In the event that Company terminates pursuant to
this Section 15, Company shall pay Contractor, and Contractor shall invoice
Company in accordance with Section 3, *** (the “Early Termination Fee”).

Devon - Internal

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SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT
OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY
SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN
MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

B.Subsequent to termination of this Agreement by Company pursuant to Section
15A, Contractor shall use commercially reasonable efforts to market the Storage
Facilities to other customers for customer-dedicated high-efficiency sand silo
storage and accompanying transloading services to procure a replacement storage
and transloading contract with a third party for the Storage Facilities
(“Replacement Contract”); provided that Contractor shall not be required to
accept a transload fee or other arrangement that would render the contract
economically infeasible to Contractor or cause Contractor to operate at a loss.

C.If Contractor procures a Replacement Contract pursuant to Section 15B, then
Contractor must provide Company with five (5) days’ written notice after the
Replacement Contract is executed, and Company may be entitled to a reimbursement
of the Early Termination Fee in the amount being *** (the “Reimbursement
Eligible Amount”).  The Reimbursement Eligible Amount shall be paid to Company
in accordance with Section 15D.  For the avoidance of doubt, any volumes
transloaded at the Transload Facility under a Spot Contract or other similar
arrangement shall not be considered a Replacement Contract and therefore shall
not be includedin the calculation of any Reimbursement Eligible Amount.  For
purposes of the Agreement, a “Spot Contract” shall be any agreement or
arrangement that is less than six (6) months in contiguous duration and does not
contain any volume commitments.

D.For each calendar quarter (or part thereof) from the commencement date of a
Replacement Contract through the earlier of the date when the Initial Term of
this Agreement was originally scheduled to end, and the end of the term of the
Replacement Contract, for all amounts above the Storage Facilities Minimum
Volume Commitment Contractor shall pay to Company, no later than sixty (60) days
following the end of the applicable calendar quarter, a reimbursement of the
Reimbursement Eligible Amount equal to ***.  Notwithstanding anything herein,
the aggregate amount of reimbursement payments made by Contractor to Company
pursuant to this Section 15D shall not exceed the Reimbursement Eligible
Amount.”

4.OPERATIONAL COMMITMENTS.  As an inducement and consideration for Contractor to
amend the Agreement as provided for in Sections 5 “Access Rights;Transloading
Rights; Additional Facilities” and 6 “Exhibit 1” of this Amendment 1, Company
agrees to use Solaris Oilfield Site Services Operating, LLC, an affiliate of
Contractor,for Company’s well site proppant storage commitments as specified in
Schedule A of the commercial terms ***.  Such rentals and commitments will be
governed by the Master Service and Supply Agreement for Exploration and
Production ***, including any work orders issued thereunder, between Company and
Solaris Oilfield Site Services Operating, LLC.  In the event Company breaches
this Section 4, the amendments in Sections 5 “Access Rights;Transloading Rights;
Additional Facilities” and 6 “Exhibit 1” below shall be subject to revision at
the reasonable discretion of Contractor, which does not hinder Company from
fulfilling its obligations under Section 7 “Exhibit 2”.  For the avoidance of
doubt, each of Company and Contractor agree that *** shall be sufficient to
allow Company to fulfill its obligations under Section 7 “Exhibit 2”; however,
Contractor may, in its sole discretion, agree to provide Company with more
storage.

5.ACCESS RIGHTS; TRANSLOADING RIGHTS; ADDITIONAL FACILITIES.  The definition of
“Storage Facilities” in Section 2 of the Agreement is hereby deleted in its
entirety and replaced with the following:

“Company-dedicated high-efficiency sand silo storage with 20,000 tons of
capacity (the “Storage Facilities”).”

6.EXHIBIT 1.  Section II of EXHIBIT 1 of the Agreement relating to TRANSLOAD
FACILITY RIGHTS AND LIMITS shall be amended as follows:

a.Section II(b).  Section II(b) of Exhibit 1 shall be deleted in its entirety
and replaced with the following:

“After the completion of the Storage Facilities, Company will have 20,000 tons
of silo storage in four individual 5,000 ton silos with a total of *** truck
loading bays as well as dedicated

Devon - Internal

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SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT
OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY
SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN
MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

access to the Transload Facility’s truck dump pit. Additionally, Company will
have access to *** railcar spots for direct-to-truck transloading, with
sufficient mobile transloaders available to meet Company’s volumes.”

b.Section II(c).  Section II(c) of Exhibit 1 shall be deleted in its entirety
and replaced with the following:

“If agreed to in advance by Contractor, Company may send one unit train to the
Transload Facility at one time.  That unit train must depart from the Transload
Facility before Company lands another unit train.  Unit train length may be up
to one hundred seventy-five (175) forty five foot (45’) cars and six
locomotives.”

7.EXHIBIT 2. 

a.Storage Facilities Minimum Volume Commitment.  The definition of “Storage
Facilities Minimum Volume Commitment” shall be amended to *** tons per calendar
quarter through December 31, 2018, *** tons for the first calendar quarter of
2019 and *** tons per calendar quarter for the remaining calendar quarters.

b.Section 4. Overage Credit. Section 4 of Exhibit 2 relating to the Overage
Credit shall be deleted in its entirety and replaced with the following:

“In any Overage Quarter, the following Base Fees shall apply as to any Committed
Volume Overage in such Overage Quarter: (i) ***, (ii) ***, and (iii) *** (each a
“Overage Credit Amount”).  For the avoidance of doubt, no volumes transloaded at
the Receipt Point by a third party pursuant to Section 6 of this Exhibit 2 shall
be counted towards the calculation of any Overage Quarter or Overage Credit
Amount.”

c.Section 5. Transloading Fee Escalation.  Section 5 of Exhibit 2 relating to
the Transloading Fee Escalation shall be deleted in its entirety and shall no
longer be of any force or effect.

8.TITLE;CUSTODY.  The following shall be added to the end of Section 5.B.:

“None of the benefits of ownership of the Product are transferred to Contractor,
including the right to use the Product as collateral, for sales to other parties
or any other form of ownership or control.”

9.TAX MATTERS.  A new Section 7 shall be added to Exhbit 2 to read as follows:

“7.Ad Valorem Tax.

All ad valorem tax relating to the Product shall remain the responsibility of
Company and shall be rendered and paid by the Company.”

10.MISCELLANEOUS

a.This Amendment is binding upon and shall inure to the benefit of the Parties
hereto and their respective permitted successors and assigns.

b.Except as expressly amended hereby, all other terms and provisions of the
Agreement remain unchanged and continue to be in full force and effect.  Company
and Contractor each hereby ratifies and confirms the Agreement and every
provision thereof, as amended by this First Amendment.  The terms of this First
Amendment will control over any conflicts between it and the terms of the
Agreement.

Devon - Internal

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SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT
OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY
SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN
MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

c.This Amendment may be executed in multiple counterparts, each of which shall
be deemed an original, but all of which shall constitute one and the same
document.

d.This First Amendment shall be construed, enforced and performed in accordance
with the laws of the State of Oklahoma, excluding its conflict of law
principles.  Any failure of either of the parties hereto to enforce any of its
rights or remedies hereunder shall not constitute a waiver of its rights to do
so thereafter.  Venue for any action to enforce the terms and conditions of this
Agreement shall be in the Federal Court for the U.S. District of Oklahoma or the
State courts located in Oklahoma County, State of Oklahoma.

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IN WITNESS WHEREOF, Contractor and Company have caused this Sand Storage And
Transload Agreement to be executed by their respective representatives thereunto
duly authorized.

 

 

 

COMPANY:

 

DEVON ENERGY PRODUCTION COMPANY, L.P.

 

 

By:

/s/ Michael Dionisio

Name:

Michael Dionisio

Title:

Vice President, Marketing & Supply Chain

 

 

CONTRACTOR:

 

SOLARIS LOGISTICS, LLC

 

By:

/s/ William Zartler

Name:

William Zartler

Title:

Chief Executive Officer

 

 

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