Exhibit 10.41


 


2001 EMPLOYMENT AGREEMENT


 


 


THIS 2001
EMPLOYMENT AGREEMENT (hereinafter referred to as the “Agreement”) is made
effective as of June 14, 2001, by and between WESTERN GAS RESOURCES, INC., a
Delaware corporation, (hereinafter referred to as the “Corporation”), and
EDWARD A. AABAK (hereinafter referred to as the “Employee”).


 


WITNESSETH:


 


WHEREAS, the
Corporation, its subsidiaries and affiliates (the “Western Companies”) acquire,
design, construct and operate natural gas gathering and processing facilities,
market, store and transport natural gas, natural gas liquids and sulphur,
market electrical power and explore for, develop, and produce oil and gas.


 


WHEREAS,
employee has substantial experience in the Corporation’s business and is
currently the Corporation’s Senior Vice President-Operations.


 


WHEREAS, prior
hereto, the Corporation and the Employee have entered into that certain
Employment Agreement, dated January 2, 2001, which shall be terminated upon
execution of this Agreement and further, shall be replaced in its entirety by
this Agreement.


 


NOW,
THEREFORE, in consideration of the premises and the mutual covenants contained
herein, the parties hereto agree as follows:


 


1.             Employment.
Corporation hereby employs the Employee and the Employee hereby accepts such
employment with the Corporation upon the terms and conditions hereafter set
forth. The Employee’s employment shall continue until it is terminated in
accordance with the provisions of paragraph 12 hereof.


 


2.             Powers, Duties and
Responsibilities.


 


(a)           Employee shall devote
his full time, attention and effort to the business of the Western Companies
during the Corporation’s normal business hours and during such other times as
are reasonably necessary for the proper performance of his responsibilities
hereunder.


 


(b)           Employee’s primary
duties shall be to act as Senior Vice President-Operations. Employee shall have
such powers, duties and responsibilities, and shall perform such other
functions in connection with the business of the Companies, as may be assigned
from time to time by the Corporation. At all times during Employee’s employment
under this Agreement (including employment following a Change of Control of the
Corporation as hereinafter described), Employee shall be employed in the Corporation’s
offices in Denver, Colorado.


 


3.             Compensation and
Bonus. For all of the services rendered by Employee pursuant to this
Agreement, the Corporation shall pay the Employee his or her current annual
base salary. In no event shall Employee’s current annual base salary be
decreased, but it may, from time to time be increased at the discretion of
Employer during the term of this Agreement (hereinafter referred to as
Compensation), payable in accordance with the Corporation’s normal pay
practices during the term of Employee’s employment. In addition, the
Corporation may pay Employee a bonus, as may be determined pursuant to any
bonus plan applicable to the Employee for such year, if any, approved by the
Corporation’s Board of Directors from time-to-time in its sole and absolute
discretion. Employee may provide a written election to have any bonus due in
December of any year paid in January of the following year.


 


4.             Officer Insurance
Coverage – Costs of Defense. During the term of Employee’s employment and
for two (2) years thereafter, to the extent the Corporation maintains an
insurance policy or policies


 

















 


providing
directors’ and officers’ liability insurance, Employee shall be covered by such
policy or policies, in accordance with its or their terms, to the maximum
extent of the coverage available for any Corporation officer.  Such coverage shall provide to Employee
officer liability insurance coverage to cover any claims that may be made
arising from his past, present, or future activities on behalf of the Western
Companies, in the same manner as such insurance is provided to the other
officers of the Corporation, provided that such insurance coverage is available
to the Corporation at a reasonable cost. 
Employee hereby represents that to his knowledge no investigation,
claim, or litigation is currently pending or threatened against him at this
time related to or arising out of his activities as an employee of any Western
Company.


 


5.             Cooperation With
Respect to Investigations, Claims or Litigation. During the term of
Employee’s employment and at all times thereafter, should a Western Company
become involved in any investigation, claim, or litigation relating to or
arising out of Employee’s past, present, or future duties with a Western
Company or with respect to any matters which the Employee has knowledge,
Employee agrees to fully, and in good faith, cooperate with the Corporation
with respect to such investigation, claim, or litigation.  The Corporation shall reimburse Employee for
any and all expenses (including attorneys’ fees) and, if requested by Employee
shall (within two business days of such request) advance such expenses to
Employee, which are incurred by Employee in connection with any action for (i)
indemnification or advance payment of expenses by the Corporation under this
Agreement or any other agreement or Corporation Bylaw now or hereafter in
effect relating to claims and/or (ii) recovery under any directors’ and
officers’ liability insurance policies maintained by the Corporation, regardless
of whether Employee ultimately in determined to be entitled to such
indemnification, advance expense payment or insurance recovery, as the case may
be.


 


6.             Indemnification
Agreement. Exhibit “A”, attached hereto and incorporated herein by
reference is an Indemnification Agreement by and between the Corporation and
the Employee.  The Corporation and the
Employee each agree to execute and deliver such Indemnification Agreement
concurrently with the execution and delivery of this Agreement.  To the extent any provision set forth in the
Indemnification Agreement is in conflict with any provision set forth in this
Agreement, the provision set forth in the Indemnification Agreement shall
govern.


 


7.             Employee Benefits.
During the term of employment, Employee shall be eligible to participate in the
employee benefit plans provided by the Corporation in which the Employee
participates as of the date hereof, as such plans may be changed from time to
time, in accordance with the provisions of such plans, including, but not
limited to, the Corporation’s qualified retirement plans, the Corporation’s
Stock Option Plan(s), and the Corporation’s loan plan to acquire stock.  The Employee hereby agrees and acknowledges
that nothing in this Agreement guarantees him the right to any grant of stock
options under any Stock Option Plan, or loan under any loan plan and that the
Board of Directors, in its sole and absolute discretion, in accordance with the
terms of such plans, as they may be modified from time to time, determines
whether and when any


stock options are granted or
loans extended.


 


8.             Confidential
Information. Employee acknowledges that pursuant to the employment
hereunder, Employee occupies a position of trust and confidence.  Accordingly, in order to facilitate the
performance of this Agreement and the activities contemplated by this
Agreement, the Western Companies may disclose to Employee or Employee may
develop or obtain certain proprietary or confidential information of the
Western Companies.  During Employee’s
employment hereunder and for a period of one (1) year thereafter (which may be
increased to two (2) years thereafter pursuant to Section 14(a)(ii) or (v)
hereof), Employee hereby agrees not to use or to disclose to any person, other
than in the discharge of his duties under this Agreement, any “proprietary or
confidential” information of the Western Companies, including, but not limited
to, any information concerning the business operations, business strategies, or
internal structure of the Western Companies; the customers or clients of the
Western Companies; any acquisition strategies of the Western Companies; the gas
and other products’ marketing or transportation strategies of the Western
Companies, its subsidiaries or affiliates; the terms of any gas gathering ,
processing, marketing, or transportation contracts entered into by the Western
Companies; past, present, or future research done by the Western Companies
respecting the business or operations of the Western Companies, or customers or
clients or potential customers or clients of the Western Companies; personnel
data of the Western Companies, product or process knowledge; the Employee’s
work performed for, or relating to or


 

















 


for, any customer or client of
any Western Company or the gas or other product pricing for any customer or
client of any Western Company; any method or procedure relating or pertaining
to projects developed by any Western Company or contemplated by any Western
Company to be developed; or any gas gathering, processing, drilling, marketing,
transportation project which any Western Company is developing; or any plans or
strategy related to the foregoing which is not generally available or disclosed
to the public.


 


If the
Employee violates this agreement of confidentiality, the Corporation shall, in
addition to any other remedy provided by law, be permitted to pursue an action
for injunctive relief, monetary damages, or both. The Employee acknowledges
that all such information constitutes confidential and/or proprietary information
of the Western Companies and agrees that such information shall be kept
confidential; such information shall be used solely for the purpose of
performing the obligations hereunder or activities contemplated by this
Agreement; and that he shall not otherwise disclose or make use of such
information, except in response to a court order.


 


9.             Non-Solicitation. During
Employee’s employment hereunder and for a period of three years thereafter,
Employee shall not engage in any of the following:


 


(i)            Hire,
offer to hire (or participate in the hiring or offer to hire of) any officer or
employee of any Western Company; or


 


(ii)           directly
or indirectly, solicit, divert or take away or attempt to solicit, divert or
take away any business any Western Company has enjoyed or solicited prior to
the date hereof or at any time during Employee’s term of employment with the
Corporation.


 


This
provision, however, shall not be construed to require the Employee to violate
any law forbidding anti-competitive practices or any law regarding anti-trust.


 


In addition,
nothing contained herein shall prevent Employee from hiring any officer or
employee of any Western Company as a result of a general solicitation in a
publicly available publication. In the event Employee violates this non-solicitation
provision, the Western Company shall, in addition to any other remedy provided
by law, be permitted to pursue an action for injunctive relief, monetary
damages, or both.


 


10.           Ownership of
Documents. All information, drawings, documents and materials whether in
writing, on computer disks, computer hard drive, on magnetic tape or otherwise
prepared by the Employee in connection with his employment, or which Employee
obtains in the course of or as result of his employment by the Corporation
shall be the sole and exclusive property of the Corporation and will be
delivered to the Corporation by the Employee on the earlier of a demand by the
Corporation or promptly after termination of his employment hereunder, together
with all written, computer, magnetic tape or other evidence of the information,
drawings, document and materials, if any, furnished by any Western Company to
the Employee in connection with the Employee’s employment.


 


11.           Agreement Not To
Compete. The parties hereto recognize that the Employee is retained by the
Corporation as part of a professional, management and executive staff of the
Corporation whose duties include the formulation and execution of management
policy. Therefore, except in the event of termination which would entitle Employee
to payments pursuant to paragraphs 14 (a) (ii), or
14 (a) (v) in which case the terms of this provision shall not apply,
the Employee hereby agrees that during the term of his employment hereunder and
for a period of one (1) year after the termination of employment, he shall not
act or engage in material competition with the activities of or plans of any
Western Company as they exist up to the time of the Employee’s termination of
employment. Material competition by the Employee shall mean that the Employee
is involved in any business or investment activity, in any capacity including
but not limited to an employee, consultant, advisor, agent, shareholder,
independent contractor, investor, partner, member, owner or otherwise, which
activity directly competes with or has a material adverse economic effect on
any of the business activities or business plans of any Western Company.
Examples of such material competition include, but shall not be limited to an
activity involving the gathering and processing business within 25 miles of one
of the Western Companies’ existing or planned gathering, processing or
generation facilities; an activity involving the storage or hub business for
natural gas or


 

















 


natural gas liquids within 100
miles of an existing or planned storage facility of any Western Company; and/or
an activity involving the purchase of oil or gas leases, the farming-in of such
leases or any similar arrangement, within five (5) miles of the boundaries of
an existing oil or gas lease of any Western Company. In the event the Employee
violates this agreement not to compete, the Corporation shall, in addition to
any other remedies provided by law, be permitted to pursue an action for
injunctive relief (preliminary or permanent), monetary damages, or both.


 


12.           Termination of
Employment. Employee’s employment pursuant to this Agreement shall
terminate upon the first to occur of the following events:


 


(a)           The
Employee’s death.


 


(b)           The
Employee’s disability as that term is defined pursuant to the Corporation’s
disability insurance plan covering its officers.


 


(c)           The
Employee’s written election to terminate employment, to be effective ninety
(90) days thereafter unless an earlier effective date is specified by the
Corporation.


 


(d)           The
Corporation’s written election to terminate Employee’s employment without
“cause.”


 


(e)           The
Corporation’s written election to terminate the Employee’s employment “for
cause.”


 


(f)            In
the event of a Change of Control (as hereinafter defined), Employee’s
employment is terminated without cause or upon the expiration of six (6) months
following a Change of Control, whichever is earlier.


 


For purposes
of this Agreement, the Corporation may elect to terminate Employee’s employment
“for cause” if: (i) Employee shall have committed a felony, fraud, theft
or embezzlement involving the assets of any Western Company; (ii) Employee
violates or causes any Western Company to violate, in a material respect, any
statute, law, ordinance, rule or regulation relating to such Western Company,
which violation results in a material adverse effect to the Corporation’s
business or financial condition; (iii) Employee engages in any activity
which is outside the scope of the Employee’s authority and detrimental to any
Western Company’s business; (iv) Employee fails to comply with the
provisions of this Agreement and Employee has either (x) not diligently
commenced to correct such detrimental activity; or (y) failed to comply
after ten (10) days’ written notice from the Corporation, which notice provides
a detailed description thereof; or (v) Employee intentionally fails or
refuses to perform his obligations or responsibilities hereunder, or to carry
out any reasonable and lawful direction of the Corporation with respect to such
obligations or responsibilities.


 


13.           Employee’s Rights
and Obligations Upon Death or Disability. If the Employee’s employment is
terminated as a result of death or disability, then the Employee shall be
entitled to the following in full satisfaction of all of his rights under this
Agreement or at law:


 


(i)            Employee’s
Right to Compensation and Benefits. Employee shall be entitled to the
pro-rata share of Compensation and employee benefits, if any, which have been
earned but not paid through the date of Employee’s death or disability. Employee
shall only be entitled to such additional bonus, if any, which has been
previously authorized by the Board of Directors, but has not been paid as of
the date of Employee’s death or disability.


 


(ii)           Employee’s
Obligations. Notwithstanding such termination of employment, if the
Employee is terminated as a result of disability, Employee shall remain bound
by the provisions of paragraphs 5, 8, 9, 10 and 11 hereof.


 


14.           Employee’s Rights
and Obligations Upon Termination of Employment By the Corporation Without
Cause. If Employee’s employment is terminated by the Corporation without
cause pursuant to Section 12(d) herein, than Employee shall be entitled to
the following in full satisfaction of his rights under


 

















 


this Agreement or at law:


 


(a)           Severance Pay.


 


(i)            Employee
shall be entitled to severance pay in an amount equal to the annual
Compensation. Such severance pay will be payable in accordance with the
Corporation’s normal pay practices over the 12 months following such
termination of employment.


 


(ii)           Notwithstanding
anything else contained herein, in the event of a Change of Control of the
Corporation (as hereinafter defined) or after the sale of substantially all the
assets of the Corporation, upon the earlier of a) Employee’s employment is terminated
without cause after a Change of Control of the Corporation or (b) upon the
expiration of six (6) months following said Change of Control, then the
Employee shall be entitled to severance pay equal to two (2) times the annual
Compensation of Employee. Severance pay pursuant to this paragraph shall be
paid to the Employee either a) over a 24-month period or b) in a one-time lump
sum payment, at Employee’s option. If the Employee elects payment over a 24
month period, then monthly installments shall commence on the first day of the
calendar month following the date of termination of employment or the first day
of the calendar month following the expiration of six (6) months after a Change
of Control. If the Employee elects payment in a one-time lump sum payment, then
said payment shall be made within thirty (30) days of the date of termination
of employment or within thirty (30) days after the expiration of the six (6)
months after a Change of Control. In the event that the Employee is entitled to
the severance pay pursuant to this sub-section, the obligation of the Employee
not to use or to disclose any “proprietary or confidential information” set
forth in Section 8 hereof shall apply for two (2) years following such Change
of Control of the Corporation or such sale of substantially all the assets of
the Corporation.


 


(iii)          The
severance pay provisions of this Section 14(a) (iii) are not additive
and in no event shall the Employee be entitled to receive severance pay greater
than two (2) times the annual Compensation.


 


(iv)          Notwithstanding
anything else contained herein, in the event of a Change of Control of the
Corporation (as hereinafter defined) or after the sale of substantially all the
assets of the Corporation, upon the earlier of a) Employee’s employment is
terminated without cause after a Change of Control of the Corporation or b)
upon the expiration of six (6) months following said Change of Control, then
Employee shall receive either of the following for unvested stock options
previously granted to Employee:


 


  A) in the event of a Change of
Control in which the Corporation is acquired in a cash purchase, then Employee
shall receive a lump sum payment constituting the positive difference between
the exercise price of unvested stock options previously granted to Employee and
the transaction price of common stock; or


 


  B) in the event of a Change of
Control in which the Corporation is acquired in a stock purchase, then
Employee’s stock options which have not vested prior to termination without
cause shall be converted to an amount of unqualified vested options of the
acquiring corporation’s stock at the original grant price to Employee based
upon the conversion rate of the acquiring corporation’s stock on the
acquisition date.


 


(v)           Notwithstanding
anything else contained herein, in the event Employee’s employment is
terminated without cause within sixty (60) days prior to the release of a press
release regarding a Change of Control of the Corporation, then the Employee
shall be entitled to severance pay equal to two (2) times the annual
Compensation of Employee. Severance pay pursuant to this paragraph shall be
payable to the Employee either a) over a 24 month period or b) in a one-time
lump sum payment, at Employee’s


 

















 


option. If the
Employee elects payment over a 24-month period, then monthly installments shall
commence on the first day of the calendar month following Employee’s election
for payment. If the Employee elects payment in a one-time lump sum payment,
then said payment shall be made within thirty (30) days of the date of
Employee’s election for payment. In addition, for any unvested stock options
previously granted to Employee, Employee shall be entitled to either payment or
conversion of such unvested stock options as described in paragraph 14 (a) (iv).
In the event that the Employee is entitled to severance pay pursuant to this
sub-section, the obligation of the Employee not to use or disclose any
“proprietary or confidential information” set forth in Section 8 hereof shall
apply for two (2) years following the, earlier of such termination or such
Change of Control of the Corporation.


 


(vi)          For
purposes of this Agreement, “Change of Control of the Corporation” means the
acquisition by any person or persons acting in concert (including corporations,
partnerships, associations or unincorporated organizations), of legal ownership
or beneficial ownership (within the meaning of Rule 13d-3, promulgated by the
Securities and Exchange Commission and now in effect under the Securities
Exchange Act of 1934 (s amended), of a number of voting shares of capital stock
of the Corporation greater than the number of voting shares of capital stock of
the Corporation which are then owned, both legally and beneficially (as defined
above), by Brion G. Wise, Bill M. Sanderson, Walter L. Stonehocker, Dean
Phillips, Ward Sauvage, their immediate families and the companies through
which they and their immediate families hold ownership in the Corporation (“the
Founders”). None of the founders shall be counted among those persons acting in
concert to acquire ownership unless such Founder, acting in concert with an
acquiring person or group (an “Acquiring Group Founder”), votes against the
other Founders in an election for the Board of Directors or the modification of
the Corporation’s certificate of incorporation or by-laws or in the vote to
accept or reject a plan of merger, sale of substantially all of the assets of
the Corporation or similar proposal. The shares of an Acquiring Group Founder
shall be counted in the acquiring group’s shares and shall not be counted in
the shares of the Founders who are not Acquiring Group Founders.


 


(b)           Employee’s
Right to Compensation and Benefits. Employee shall be entitled to the
pro-rata share of Compensation and employee benefits, if any, which have been
earned but not paid through the date of termination of employment. Employee
shall only be entitled to such additional bonus, if any, which has been
previously authorized by the Board of Directors, but has not been paid as of
the date of termination of employment.


 


(c)           Payment
of Excise Taxes. The Corporation shall be responsible for the payment of any
and all excise taxes including any increase in income taxes resulting from such
payment, which may result or be assessed to the Employee in connection with
payments, whether in cash, stock or benefits received by the Employee under
this paragraph 14 of this Agreement. In addition, the Corporation shall defend,
indemnify, save and hold the Employee harmless from any and all claims for excise
taxes which are due or may become due or which arise or result from any dispute
with a Federal, state or local taxing authority in connection with this
paragraph 14.


 


(d)           Employee’s
Obligations. Notwithstanding such termination of employment, Employee shall
remain bound by provisions of paragraphs 5, 8, 9, 10 and 11 hereof.


 


15.           Employee’s
Rights and Obligations Upon Termination of Employment by the Corporation With
Cause. If Employee’s employment is terminated by the Corporation with cause
pursuant to paragraph 12(e) herein, then the Employee shall be entitled to the
following in full satisfaction of all of his rights under this Agreement or at
law:


 


(i)            Severance
Pay. Employee shall not be entitled to any severance pay.


 

















 


(ii)           Employee’s Right to Compensation
and Benefits. Employee shall only be entitled to the pro-rata share of
Compensation and employee benefits, if any, earned but not paid through the
date of termination of employment. Employee shall only be entitled to such
additional bonus, if any, which has been previously authorized by the Board of
Directors, but has not been paid as of the date of termination of employment.


 


(iii)          Employee’s
Obligations. Notwithstanding such termination of employment, Employee shall
remain bound by the provisions of paragraphs 5, 8, 9, 10 and 11 hereof.


 


16.           Employee’s Rights
and Obligations Upon Termination of Employment By Employee. If Employee’s
employment is terminated by the Employee pursuant to paragraph 12(c) herein,
then the Employee shall be entitled to the following in full satisfaction of
all of his rights under this Agreement or at law:


 


(i)            Severance Pay.
Employee shall be entitled to no severance pay.


 


(ii)           Employee’s Rights to
Compensation and Benefits. Employee shall be entitled to the pro-rata share
of Compensation and Employee Benefits, if any, which have been earned but not
paid through the effective date of such termination of employment. Employee
shall only be entitled to such additional bonus, if any, which has been paid
previously authorized by the Board of Directors, but has not been paid as of
the date of termination of employment.


 


(iii)          Employee’s
Obligations. Notwithstanding such termination of employment, Employee shall
remain bound by the provisions of paragraphs 5, 8, 9, 10 and 11 hereof.


 


17.           Benefit. This
Agreement shall inure to the benefit of and be binding upon the Corporation,
its successors and assigns, including, but not limited to (i) any entity which
may acquire all or substantially all of the Corporation’s assets and business,
(ii) any entity with or into which the Corporation may be consolidated or
merged, or (iii) any entity that is the successor corporation in a share
exchange, and the Employee, his heirs, guardians and personal and legal
representatives. The Employee and the Corporation also agree that each Western
Company shall be deemed to be a third-party beneficiary to this Agreement.


 


18.           Notices. All
notices and communications hereunder shall be in writing and shall be deemed
given when sent postage prepaid by registered or certified mail, return receipt
requested, and, if intended for the Corporation, shall be addressed to it, to
the attention of its President, at:


 


Western Gas
Resources, Inc.


12200 North
Pecos Street


Denver,
Colorado 80234


 


or at such other address which
the Corporation shall have given notice to the Employee in the manner herein
provided, and if intended for the Employee, shall be addressed to him at his
last known residence, or at such other address at which the Employee shall have
given notice to the Corporation in the manner provided herein:


 


Edward A.
Aabak


253 Corby
Court


Castle Rock,
CO 80140


 


19.           Governing Law.
This Agreement shall be governed by and construed in accordance with the laws
of the State of Colorado.


 


20.           Severability. In
the event one or more of the provisions contained in this Agreement, or any
application thereof, shall be invalid, illegal or unenforceable in any respect,
the validity, legality and enforceability of the remaining provisions contained
herein or any other application or modification thereof, shall not in any way
be affected or impaired. The parties further agree that any such invalid,
illegal or unenforceable provision or restriction shall be deemed modified so
that it shall be enforced to the greatest


 

















 


extent permissible under law,
and to the extent that any court of competent jurisdiction determines any
provision or restriction herein to be overly broad, or unenforceable, such
court is hereby empowered and authorized to limit such provisions or
restriction so that it is enforceable for the longest duration of time, within
the largest geographical area and with the broadest scope.


 


21.           Miscellaneous.


a)             Counterparts.
This Agreement may be executed in more than one copy, each copy of which shall
serve as an original for all purposes, but all copies shall constitute but one
and the same Agreement.


 


(b)           Assignment.
Except as provided in paragraph 17, this Agreement is personal to each of the
parties hereto, and neither party may assign nor delegate any of such party’s
rights or obligations hereunder without first obtaining the written consent of
the other party.


 


(c)           Headings. All
headings set forth in this Agreement are intended for convenience only and
shall not control or affect the meaning, construction or effect of this
Agreement or of any of the provisions hereof.


 


(d)           Gender, Plurals and
Pronouns. Throughout this Agreement, the masculine gender shall include the
feminine and neuter, and the singular shall include the plural and vice versa,
wherever the context and facts require such construction.


 


(e)           Binding Arbitration.
Attorney’s Fees and Expenses. Except for disputes arising or resulting from the
provisions contained in paragraph 14 of this Agreement, if any dispute arises
between the parties to this Agreement (but not as to whether the Corporation is
obligated to provide legal representation to the Employee pursuant to Section 4
hereof), then both parties shall submit the dispute to binding arbitration.
Both parties agree to be bound by the decision of such arbitration. The
obligation to submit to binding arbitration shall not prevent either party from
seeking a court order or an injunction enforcing the term of this Agreement. In
the event of any binding arbitration between the parties, or any litigation to
enforce any provision (except for disputes arising or resulting from the
provision contained in paragraph 14) of this Agreement or any right of either
party, the unsuccessful party to such arbitration or litigation shall pay the
successful party all costs and expenses, including reasonable attorneys’ fees,
incurred. In the event a dispute arises or results from the provisions of
paragraph 14 of this Agreement, then both parties shall submit the dispute to
binding arbitration under the foregoing provisions, except that all costs and
expenses, including reasonable attorneys’ fees, incurred shall be solely borne
by the Corporation.


 


(f)            Waiver of Breach.
The waiver by any party hereto of any provision of this Agreement shall not
operate or be construed as a waiver of any subsequent breach by any party.


 

















 


(g)           Entire Agreement.
Except for the Indemnification Agreement, this Agreement contains all
agreements, understandings, and arrangements between the parties hereto and no
other exists. Except for the Indemnification Agreement, all previous
agreements, understandings, and arrangements between the parties relating to
employment are terminated by this Agreement. This Agreement may be amended,
waived, changed, modified, extended or rescinded only by a writing signed by
the party against whom such amendment, waiver, change, modification, extension
or rescission is sought.


 


IN WITNESS WHEREOF, the parties
have hereunto set their hands as of the date first written above.


 


	
   

  	
  WESTERN GAS
  RESOURCES, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Lanny F.
  Outlaw

  	
   

  
	
   

  	
   

  	
  Lanny F.
  Outlaw, President & CEO

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EMPLOYEE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Edward
  A. Aabak

  	
   

  
	
   

  	
  Edward A. Aabak

  



 

















 


2001 INDEMNIFICATION AGREEEMNT


 


 


THIS 2001 INDEMNIFICATION AGREEMENT (this
“Agreement”), effective as of June 14, 2001, between Western Gas Resources,
Inc., a Delaware corporation (the “Company”), and EDWARD A. AABAK (the
“Indemnitee”).


 


WHEREAS, it is
essential to the Company to retain and attract as officers the most capable
persons available;


 


WHEREAS, Indemnitee
is an officer of the Company;


 


WHEREAS, both the
Company and Indemnitee recognize the increased risk of litigation and other
claims being asserted against officers of public companies in today’s
environment:


 


WHEREAS, the Bylaws
of the Company require tile Company to indemnity and advance expenses to its
officers to the full extent permitted by law and the Indemnitee has been
serving and continues to serve as an officer of the Company in part in reliance
on such Bylaws;


 


WHEREAS, in
recognition of indemnitee’s need for substantial protection against personal
liability in order to enhance Indemnitee’s continued service to the Company in
an effective manner and Indemnitee’s reliance on the aforesaid Bylaws, and in
part to provide indemnitee with specific contractual assurance that the
protection promised by such Bylaws will be available to Indemnitee (regardless
of, among other things, any amendment to or revocation of such Bylaws, or any
change in the composition of the Company’s Board of Directors or acquision
transaction relating to the Company), the Company wishes to provide in this
Agreement for the indemnification of and the advancing of expenses to
Indemnitee to the fullest extent (whether partial or complete) permitted by law
and as set forth in this Agreement, and, to the extent insurance is maintained,
for the continued coverage of Indemnitee under the Company’s directors’ and
officers’ liability insurance policies;


 


WHEREAS, prior
hereto, the Company and the Indemnitee had entered into an indemnification
agreement that the parties desire to restate;


 


NOW, THEREFORE, in
consideration of the premises and of Indemnitee continuing to serve the Company
directly or, at its request, another enterprise, and intending to be legally
bound hereby, the parties hereto agree as follows:


 


1.             Certain
Definitions.


(a)           Change
in Control: shall be deemed to have occurred if (i) any “person” (as such
term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of
1934, as amended), other than a trustee or other fiduciary holding securities
under an employee benefit plan of the Company or a corporation owned directly
or indirectly by the stockholders of the Company in substantially the same
proportions as their ownership of stock of the Company, is or becomes the
“beneficial owner” (as defined in Rule 13d3 under said Act), directly or
indirectly, of securities of the Company representing 20% or more of the total
voting power represented by the Company’s then outstanding Voting Securities,
or (ii) during any period of two consecutive years, individuals who at the
beginning of such period constitute the Board of Directors of the Company and
any new director whose election by the Board of Directors or nomination for
election by the Company’s stockholders was approved by a vote of at least two-thirds
(2/3) of the directors then still in office who either were directors at the
beginning of the period or whose election or nomination for election was
previously so approved, cease for any reason to constitute a majority thereof,
or (iii) the stockholders of the Company approve a merger or consolidation of
the Company with any other corporation, other than a merger or


 


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consideration
which would result in the Voting Securities of the Company outstanding
immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into Voting Securities of the surviving
entity) at least 80% of the total voting power represented by the Voting
Securities of the Company or such surviving entity outstanding immediately
after such merger or consolidation, or the stockholders of the Company approve
a plan of complete liquidation of the Company or an agreement for the sale or
disposition by the Company of (in one transaction or a series of transactions)
all or substantially all the Company’s assets.


 


(b)           Claim:
any threatened, pending or completed action, suit or proceeding, or any inquiry
or investigation, whether instituted by the Company or any other party, that
Indemnitee in good faith, believes might lead to the institution of any such
action, suit or proceeding, whether civil, criminal, administrative,
investigative or other.


 


(c)           Expenses:
Include attorneys’ fees and all other costs, expenses and obligations paid or
incurred in connection with investigating, defending, being a witness in or
participating in (including on appeal), or preparing to defend, be a witness in
or participate in any Claim relating to any Indemnifiable Event.


 


(d)           Indemnifiable
Event: any event or occurrence related to the fact tat Indemnitee is or was
a director, officer, employee, agent of fiduciary of the Company, or is or was
serving at the request of the Company as a director, officer, employee,
trustee, agent or fiduciary of another corporation, partnership, joint venture,
employee benefit plan, trust or other enterprise, or by reason of anything done
or not done by Indemnitee in any such capacity.


 


(e)           Independent
Legal Counsel: an attorney or firm of attorneys, selected in accordance
with the provisions of Section 3, who shall not have otherwise performed
services for the Company or Indemnitee within the last five years (other than
with respect to matters concerning the rights of Indemnitee under this
Agreement, or of other indemnitees under similar indemnity agreements).


 


(f)            Potential
Change in Control: shall be deemed to have occurred if (i) the Company
enters into an agreement, the consummation of which would result in the
occurrence of a Change in Control; (ii) any person (including the Company)
publicly announces an intention to take or to consider taking actions which if
consummated would constitute a Change in Control; (iii) any person, other than
a trustee or other fiduciary holding securities under an employee benefit plan
of the Company or corporation owned, directly or indirectly, by the
stockholders of the Company in substantially the same proportions as their
ownership of stock of the Company, who is or becomes the beneficial owner,
directly or indirectly, of securities of the Company representing 9.5% or more
of the combined voting power of the Company’s then outstanding Voting
Securities, increase his beneficial ownership of such securities by five
percentage points (5%) or more over the percentage so owned by such person; or
(iv) the Board adopts a resolution to the effect that, for purposes of this
Agreement, a Potential Change in Control has occurred.


 


(g)           Reviewing
Party: any appropriate person or body consisting of a member or members of
the Company’s Board of Directors or any other person or body appointed by the
Board who is not a party to the particular Claim for which Indemnitee is
seeking indemnification, or independent Legal Counsel.


 


(h)           Voting
Securities: any securities of the Company which vote generally in the
election of directors.


 


2.             Basic
Indemnification Arrangement.


(a)           In
the event Indemnitee was, is or becomes a party to or witness or other
participant in, or is threatened to be made a party to or witness or other
participant in, a Claim by reason of (or arising in part out of) an
Indemnifiable Event, the Company shall indemnify Indemnitee to the fullest
extent permitted by law as soon as practicable but in any event no later than
thirty days after written demand is presented to the Company, against any and
all Expenses, judgments, fines, penalties and amounts paid in settlement
(including all


 


2

















 


interest,
assessments and other charges paid or payable in connection with or in respect
of such Expenses, judgments, fines, penalties or amounts paid in settlement) of
such Claim. If so requested by Indemnitee, the Company shall advance (within
two business days of such request) any and all Expenses to Indemnitee (an
“Expense Advance”).


 


(b)           Notwithstanding
the foregoing, the obligations of the Company under Section 2(a) shall be
subject to the condition that the Reviewing Party shall not have determined (in
a written opinion, in any case in which the Independent Legal Counsel referred
to in Section 3 hereof is involved) that Indemnitee would not be permitted
to be indemnified under applicable law.


 


(c)           Notwithstanding
the foregoing, the obligation of the Company to make an Expense Advance
pursuant to Section 2(a) shall be subject to the condition that, if, when
and to the extent that the Reviewing Party determines that Indemnitee would not
be permitted to be so indemnified under applicable law, the Company shall be
entitled to be reimbursed by Indemnitee (who hereby agrees to reimburse the
Company) for all such amounts theretofore paid; provided, however, that if
Indemnitee has commenced or thereafter commences legal proceedings in a court,
of competent jurisdiction to secure a determination that Indemnitee should be
indemnified under applicable law, any determination made by the Reviewing Party
that Indemnitee would not be permitted to be indemnified under applicable law
shall not be binding and Indemnitee shall not be required to reimburse the
Company for any Expense Advance until a final judicial determination is made
with respect thereto (as to which all rights of appeal therefrom have been
exhausted or lapsed).


 


(d)           If
there has not been a Change in Control, the Reviewing Party shall be selected
by the Board of Directors, and if there has been such a Change in Control
(other than a Change in Control which has been approved by a majority of the
Company’s Board of Directors who were directors immediately prior to such
Change in Control), the Reviewing Party shall be the Independent Legal Counsel
referred to in Section 3 hereof.


 


(e)           If
there has been no determination by the Reviewing Party or if the Reviewing
Party determines that Indemnitee, substantively would not be permitted to be
indemnified in whole or in part under applicable law, Indemnitee shall have the
right to commence litigation in any court in the States of Colorado or Delaware
having subject matter jurisdiction thereof and in which venue is proper seeking
an initial determination by the court or challenging any such determination by
the Reviewing Party or any aspect thereof, including the legal or factual bases
therefor, and the Company hereby consents to service of process and to appear
in any such proceeding. Any determination by the Reviewing Party otherwise
shall be conclusive and binding on the Company and Indemnitee.


 


(f)            Notwithstanding
anything else contained herein, in no event shall Indemnitee be entitled to
indemnification under this Agreement for any Claims that relate to liability:
(i) under Section 16(b) of the Securities Exchange Act of 1934, as
amended; (ii) under federal or state securities laws for “insider
trading”; (iii) conduct finally adjudged as constituting active or
deliberate dishonesty or willful fraud or illegality; (iv) conduct finally
adjudged as producing an, unlawful personal benefit to Indemnitee; or
(v) prior to a Change of Control, under any Claim initiated by the
Indemnitee unless the Board of Directors of the Company shall have authorized
or consented to such Claim.


 


3.             Change in Control.
The company agrees that if there is a Change in Control of the Company (other
than a Change in Control which has been approved by a majority of the Company’s
Board of Directors who were directors immediately prior to such Change in
Control) then with respect to all matters thereafter arising concerning the
rights of Indemnitee to indemnity payments and Expense Advances under this
Agreement or any other agreement or Company Bylaw now or hereafter in effect
relating to Claims for Indemnifiable Events, the Company shall seek legal
advice only from Independent Legal Counsel selected by Indemnitee and approved
by the Company (which approval shall not be unreasonably withheld). Such
counsel, amount other things, shall render its written opinion to the Company
and Indemnitee as to whether and to what extent the Indemnitee would be
permitted to be indemnified under applicable law. The Company agrees to pay the
reasonable fees of the Independent Legal Counsel referred to above and to fully


 


3

















 


indemnify such counsel against
any and all expenses (including attorneys’ fees), claims, liabilities and
damages arising out of or relating to this Agreement or its engagement pursuant
hereto.


 


4.             Establishment of
Trust.


(a)           In
the event of a Potential Change in Control, the Company shall; (i) upon
written request by Indemnitee, create a trust for the benefit of Indemnitee,
with the trustee chosen by Indemnitee; (ii) from time to time upon written
request of Indemnitee, fund such trust in an amount sufficient to satisfy any
and all Expenses reasonably anticipated at the time of each such request to be
incurred in connection with investigating, preparing for and defending any
Claim relating to an Indemnifiable Event, and any and all judgments, fines,
penalties and settlement amounts of any and all Claims relating to an
Indemnifiable Event from time to time actually paid or claimed, reasonably
anticipated or proposed to be paid.


 


(b)           Notwithstanding
anything else contained herein, in no event shall the Company be required to
deposit more than Five Hundred Thousand Dollars ($500,000) in any trust created
hereunder in excess of amounts deposited in respect of reasonably anticipated
Expenses.


 


(c)           The
amount or amounts to be deposited in the trust pursuant to the foregoing
funding obligation shall be determined by the Reviewing Party, in any case in
which the Independent Legal Counsel referred to above is involved.


 


(d)           The
terms of the trust shall provide that upon a Change in Control (i) the
trust shall not be revoked or the principal thereof invaded, without the
written consent of the Indemnitee, (ii) the trustee shall advance, within
two business days of a request by the Indemnitee, any and all Expenses to the
Indemnitee (and the Indemnitee hereby agrees to reimburse the trust under the
circumstances under which the Indemnitee would be required to reimburse the
Company under Section 2(b) of this Agreement), (iii) the trust shall
continue to be funded by the Company in accordance with the funding obligation
set forth herein, (iv) the trustee shall promptly pay to Indemnitee all
amounts for which Indemnitee shall be entitled to Indemnification pursuant to
this Agreement or otherwise, and (v) all unexpended funds in such trust
shall revert to the Company upon a final determination by the Reviewing Party
or a court of competent jurisdiction, as the case may be, that Indemnitee has
been fully indemnified under the terms of this Agreement.


 


5.             Indemnification
for Additional Expenses. The Company shall indemnify Indemnitee against any
and all expenses (including attorneys’ fees) and, if requested by Indemnitee,
shall (within two business days of such request) advance such expenses to
Indemnitee, which are incurred by Indemnitee in connection with any action
brought by Indemnitee for (i) indemnification or advance payment of
Expenses by the Company under this Agreement or any other agreement or Company
Bylaw now or hereafter in effect relating to Claims for Indemnifiable Events
and/or (iii) recovery under any directors’ and officers’ liability insurance
policies maintained by the Company, regardless of whether Indemnitee ultimately
is determined to be entitled to such indemnification, advance expense payment
or insurance recovery, as the case may be.


 


6.             Partial Indemnity,
Etc. If Indemnitee is entitled under any provision of this Agreement to
Indemnification by the Company for some or a portion of the Expenses,
judgments, fines, penalties and amounts paid in settlement of a Claim but not,
however, for all of the total amount thereof, the Company shall nevertheless
indemnify Indemnitee for the portion thereof to which Indemnitee is entitled.
Moreover, notwithstanding any other provision of this Agreement, to the extent
that Indemnitee has been successful on the merits or otherwise in defense of
any or all Claims relating in whole or in part to an Indemnifiable Event or in
defense of any issue or matter therein, including dismissal without prejudice,
Indemnitee shall be indemnified against all Expenses incurred in connection
therewith.


 


7.             Burden of Proof.
In connection with any determination by the Reviewing Party or otherwise as to
whether Indemnitee is entitled to be indemnified hereunder the burden of proof
shall be on the Company to establish that Indemnitee is not so entitled.


 


8.             No Presumptions.
For purposes of this Agreement, the termination of any claim, action, suit or
proceeding, by judgment, order, settlement (whether with or without court
approval) or conviction, or upon a plea of nolo contendere, or its equivalent,
shall not create a presumption that Indemnitee did not meet


 


4

















 


any particular standard of
conduct or have any particular belief or that a court has determined that
Indemnification is not permitted by applicable law.  In addition, neither the failure of the Reviewing Party to have
made a determination as to whether Indemnitee has met any particular standard
of conduct or had any particular belief, nor an actual determination by the
Reviewing Party that Indemnitee has not met such standard of conduct or did not
have such belief, prior to the commencement of legal proceedings by Indemnitee
to secure a judicial determination that Indemnitee should be indemnified under
applicable law shall be a defense to Indemnitee’s claim or create a presumption
that Indemnitee has not met any particular standard of conduct or did not have
any particular belief.


 


9.             Nonexclusivity,
Etc. The rights of the Indemnitee hereunder shall be in addition to any
other rights Indemnitee may have under the Company’s Bylaws or the Delaware
General Corporation Law or otherwise. 
To the extent that a change in the Delaware General Corporation Law
(whether by statute or judicial decision) permits greater indemnification by
agreement than would be afforded currently under the Company’s Bylaws and this
Agreement, it is the intent of the parties hereto that Indemnitee shall enjoy
by this Agreement the greater benefits so afforded by such change.


 


10.           Liability Insurance.
To the extent the Company maintains an insurance policy or policies providing
directors’ and officers’ liability insurance, Indemnitee shall be covered by
such policy or policies, in accordance with its or their terms, to the maximum
extent of the coverage available for any Company director or officer.


 


11.           Period of
Limitations. No legal action shall be brought and no cause of action shall
be asserted by or in the right of the Company against Indemnitee, Indemnitee’s
spouse, heirs, executors or personal or legal representatives after the
expiration of two years from the date of accrual of such cause of action, and
any claim or cause of action of the Company shall be extinguished and deemed
released unless asserted by the timely filing of a legal action within such
two-year period; provided, however, that if any shorter period of limitations
is otherwise applicable to any such cause of action such shorter period shall
govern.


 


12.           Amendments, Etc.
No supplement, modification or amendment of this Agreement shall be binding
unless executed in writing by both of the parties hereto.  No waiver of any of the provisions of this
Agreement shall be deemed or shall constitute a waiver of any other provisions
hereof (whether or not similar) nor shall such waiver constitute a continuing
waiver.


 


13.           Subrogation. In
the event of payment under this Agreement, the Company shall be subrogated to
the extent of such payment to all of the rights of recovery of Indemnitee, who
shall execute all papers required and shall do everything that may be necessary
to secure such rights, including the execution of such documents necessary to
enable the Company effectively to bring suit to enforce such rights.


 


14.           No Duplication of
Payments. The Company shall not be liable under this Agreement to make any
payment in connection with any Claim made against Indemnitee to the extent
Indemnitee has otherwise actually received payment (under any insurance policy,
Bylaw or otherwise) of the amounts otherwise indemnifiable hereunder.


 


15.           Binding Effect, Etc.
This Agreement shall be binding upon and inure to the benefit of and be
enforceable by the parties hereto and their respective successors, assigns,
including any direct or indirect successor by purchase, merger, consolidation
or otherwise to all or substantially all of the business, and/or asssets of the
Company, spouses, heirs, executors and personal and legal representatives.  This Agreement shall continue in effect
regardless of whether Indemnitee continues to serve as an officer or director
of the Company or of any other enterprise at the Company’s request.


 


16.           Severability.
The provisions of this Agreement shall be severable in the event that any of
the provisions hereof (including any provision within a single section,
paragraph or sentence) is held by a court of competent jurisdiction to be invalid,
void or otherwise unenforceable in any repect, and the validity and
enforceability of any such provision in every other respect and of the
remaining provisions hereof shall not be in any way impaired and shall remain
enforceable to the fullest extent permitted by law.


 


5

















 


17.           Governing Law.
This Agreement shall be governed by and construed and enforced in accordance
with the laws of the State of Delaware applicable to contracts made and to be
performed in such state without giving effect to the principles of conflicts of
laws.


 


IN WITNESS WHEREOF,
the parties hereto have executed this Agreement as of June 14, 2001


 


 


	
  WESTERN GAS
  RESOURCES, INC.

  	
  INDEMNITEE

  
	
   

  	
   

  
	
  By:

  	
  /s/ Lanny F.
  Outlaw

  	
   

  	
  /s/ Edward
  A. Aabak

  
	
   

  	
  Lanny F. Outlaw, President

  	
  Edward A.
  Aabak

  
				



 


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