Document:

exv10w4

 

QUICKSILVER GAS SERVICES LP

2007 EQUITY PLAN

	 	 	 	 	 	 	 
	SECTION

	 	
	 	PAGE
	 
	1.

	 	Purpose
	 	 	1	 
	2.

	 	Term
	 	 	1	 
	3.

	 	Definitions
	 	 	1	 
	4.

	 	Units Available Under Plan
	 	 	6	 
	5.

	 	Options
	 	 	6	 
	6.

	 	Appreciation Rights
	 	 	7	 
	7.

	 	Restricted Units
	 	 	9	 
	8.

	 	Phantom Units
	 	 	10	 
	9.

	 	Performance Units and Performance Bonuses
	 	 	11	 
	10.

	 	Awards to Eligible Directors
	 	 	12	 
	11.

	 	Transferability
	 	 	13	 
	12.

	 	Adjustments
	 	 	13	 
	13.

	 	Fractional Units
	 	 	14	 
	14.

	 	Withholding Taxes
	 	 	14	 
	15.

	 	Administration of the Plan
	 	 	14	 
	16.

	 	Amendments and Other Matters
	 	 	15	 
	17.

	 	Governing Law
	 	 	16	 

 

 

QUICKSILVER GAS SERVICES LP

2007 EQUITY PLAN

     1. Purpose. The Quicksilver Gas Services LP 2007 Equity Plan (the “Plan”) is intended to
promote the interests of Quicksilver Gas Services LP, a Delaware limited partnership (the
“Partnership”), by providing to employees, consultants, officers and directors of
Quicksilver Gas Services GP
LLC, a Delaware limited liability company and the general partner of the Partnership (the “General
Partner”), and its Affiliates incentive compensation awards based on Units. The Plan is also
intended to supplement the compensation that these individuals receive from the General Partner and
its Affiliates and to provide them incentives to promote the interests of the Partnership and its
Affiliates.

     2. Term. The Plan will terminate on the earliest of (a) the date that the Plan is terminated
in accordance with Section 16, (b) the date that Units are no longer available for Awards under the
Plan, or (c) the tenth anniversary of the date that the Plan is adopted by the Partnership. No
further Awards will be made under the Plan on or after such date. Awards that are outstanding on
the date the Plan terminates will remain in effect according to their terms and the provisions of
the Plan.

     3. Definitions. The following terms, when used in the Plan with initial capital letters, will
have the following meanings:

     (a) Affiliate means, with respect to any Person, any other Person that directly or
indirectly through one or more intermediaries controls, is controlled by or is under common
control with, the Person in question. As used herein, the term “control” means the
possession, direct or indirect, of the power to direct or cause the direction of the
management and policies of a Person, whether through ownership of voting securities, by
contract or otherwise.

     (b) Appreciation Right means a right granted pursuant to Section 6.

     (c) Award means a grant of Appreciation Rights, Options, Phantom Units, Performance
Units or a Performance Bonus, or the grant or sale of Restricted Units, and includes any
tandem DERs granted with respect to a Phantom Unit or Performance Unit.

     (d) Board means the Board of Directors of the General Partner.

     (e) Change in Control means the occurrence of an event described in (i), (ii) or (iii)
below:

     (i) The General Partner ceases to be controlled by the Company or one or more
Affiliates of the Company and a majority of the Board of Directors of the General
Partner thereafter ceases to be comprised of Incumbent Directors;

     (ii) The consummation of a reorganization, merger or consolidation of the
Partnership or sale or other disposition of all or substantially all of the
consolidated assets of the Partnership (a “Partnership Transaction”) immediately

 

 

after which the voting power of the equity securities of the Partnership
outstanding immediately prior to such Partnership Transaction do not continue to
represent (either by remaining outstanding or by being converted into equity
securities having voting power in the entity surviving, resulting from, or
succeeding to all or substantially all of the Partnership’s consolidated assets as a
result of such Partnership Transaction or any parent of such entity) at least 50% of
the combined voting power of the then outstanding equity securities of (A) the
entity surviving, resulting from, or succeeding to all or substantially all of the
Partnership’s consolidated assets as a result of such Partnership Transaction or (B)
any parent of any such entity (including, without limitation, an entity which as a
result of such transaction owns the Partnership or all or substantially all of the
Partnership’s assets either directly or through one or more subsidiaries); or

     (iii) The occurrence of any of the following events while the General Partner
is controlled by the Company or one or more Affiliates of the Company:

               (A) Any individual, entity or group (within the meaning of Section 13(d)(3) or
14(d)(2) of the Exchange Act) is or becomes the beneficial owner (within the meaning
of Rule 13d-3 promulgated under the Exchange Act) of 50% or more of the combined
voting power of the then-outstanding Voting Securities of the Company; provided,
however, that the following acquisitions will not constitute a Change in Control:
(1) any acquisition of Voting Securities of the Company directly from the Company
that is approved by a majority of the Incumbent Quicksilver Directors; (2) any
acquisition of the Voting Securities of the Company by the Company or an Affiliate
of the Company; (3) any acquisition of Voting Securities of the Company by the
trustee or other fiduciary holding securities under any employee benefit plan (or
related trust) sponsored or maintained by the Company or any Affiliate of the
Company; or (4) any acquisition of Voting Securities of the Company by Mercury
Exploration Company, Quicksilver Energy, L.P., The Discovery Fund, Pennsylvania
Avenue Limited Partnership, Pennsylvania Management Company, the estate of Frank
Darden, Lucy Darden, Anne Darden Self, Glenn Darden or Thomas Darden, or their
respective successors, assigns, designees, heirs, beneficiaries, trusts, estates or
controlled affiliates;

               (B) A majority of the Board of Directors of the Company ceases to be comprised
of Incumbent Quicksilver Directors;

               (C) The consummation of a reorganization, merger or consolidation of the
Company or sale or other disposition of all or substantially all of the consolidated
assets of the Company (each, a “Business Combination Transaction”) immediately after
which the Voting Securities of the Company outstanding immediately prior to such
Business Combination Transaction do not continue to represent (either by remaining
outstanding or by being converted into equity securities having voting power in the
entity surviving, resulting from, or succeeding to all or substantially all of the
Company’s consolidated assets as a result of such Business Combination Transaction
or any parent of such entity) at

2

 

least 50% of the combined voting power of the then outstanding equity
securities having voting power in (1) the entity surviving, resulting from, or
succeeding to all or substantially all of the Company’s consolidated assets as a
result of such Business Combination Transaction or (2) any parent of any such entity
(including, without limitation, an entity which as a result of such transaction owns
the Company or all or substantially all of the Company’s assets, either directly or
through one or more subsidiaries; or

               (D) The General Partner, or one or more Affiliates of the Company, ceases to be
the general partner of the Partnership.

     (f) Code means the Internal Revenue Code of 1986, as in effect from time to time.

     (g) Committee means the committee established
by the Board pursuant to Section 15 to administer the Plan or, with
respect to the administration of Section 10, the Board. If no committee has been established by the
Board to administer the Plan pursuant to Section 15, “Committee” means the Board.

     (h) Company means Quicksilver Resources Inc., a Delaware corporation.

     (i) Consultant means an individual, other than an Employee or Eligible Director, who
performs services for the Partnership, the General Partner or an Affiliate of either of them.

     (j) Date of Grant means the date specified by the Committee on which an Award will
become effective.

     (k) Deferral Period means the period of time during which Phantom Units are subject to
deferral limitations.

     (l) DER means a contingent right, granted in tandem with a specific Phantom Unit or
Performance Unit, to receive an amount in cash equal to, and at the same time as, the cash
distributions made by the Partnership with respect to a Unit during the period such Phantom
Unit or Performance Unit is outstanding.

     (m) Eligible Director means a member of the Board who is not an Employee.

     (n) Employee means an employee or officer of the General Partner or its Affiliates who
performs services for the Partnership, the General Partner or an Affiliate of either of them.

     (o) Evidence of Award means an agreement, certificate, resolution or other type or form
of writing or other evidence approved by the Committee which sets forth the terms and
conditions of an Award. An Evidence of Award may be in any electronic medium, may be limited
to a notation on the books and records of the Partnership and need not be signed by a
representative of the Partnership or a Participant.

     (p) Exchange Act means the Securities Exchange Act of 1934, as amended.

3

 

     (q) Grant Price means the price per Unit at which an Appreciation Right is granted.

     (r) Incumbent Directors means the individuals who, as of the IPO Date, are directors of
the General Partner, and any individual becoming a director of the General Partner subsequent
to such date whose election, nomination for election by the General Partner’s members, or
appointment, was approved by a vote of a majority of the then Incumbent Directors (either by
a specific vote or by approval of the proxy statement of the General Partner in which such
person is named as a nominee for director, without objection to such nomination).

     (s) Incumbent Quicksilver Directors means the individuals who, as of the IPO Date, are
directors of the Company, and any individual becoming a director of the Company subsequent to
such date whose election, nomination for election by the Company’s stockholders, or
appointment, was approved by a vote of a majority of the then Incumbent Quicksilver Directors
(either by a specific vote or by approval of the proxy statement of the Company in which such
person is named as a nominee for director, without objection to such nomination).

     (t) IPO Date means the date that the initial public offering of the Units is
consummated.

     (u) Management Objectives means the measurable performance objectives, if any,
established by the Committee for a Performance Period that are to be achieved with respect to
an Award. Management Objectives may be described in terms of company-wide objectives (i.e.,
the performance of the Partnership and all of its subsidiaries) or in terms of objectives
that are related to the performance of the individual Participant or of the division,
subsidiary, department, region or function within the Partnership or an Affiliate of the
Partnership in which the Participant receiving the Award is employed or on which the
Participant’s efforts have the most influence. The achievement of the Management Objectives
established by the Committee for any Performance Period will be determined without regard to
the effect on such Management Objectives of any acquisition or disposition by the Partnership
of a trade or business, or of substantially all of the assets of a trade or business, during
the Performance Period and without regard to any change in accounting standards by the
Financial Accounting Standards Board or any successor entity.

          If the Committee determines that, as a result of a change in the business, operations,
corporate structure or capital structure of the Partnership (other than an acquisition or
disposition described in the first paragraph of this Section 3(v)), or the manner in which
the Partnership conducts its business, or any other events or circumstances, the Management
Objectives are no longer suitable, the Committee may in its discretion modify such
Management Objectives or the related minimum acceptable
 

4

 

level of achievement, in whole or in part, with respect to a Performance Period as the
Committee deems appropriate and equitable.

     (v) Market Value per Unit means, at any date, the closing sales price of a Unit on that
date (or, if there are no sales on that date, the last preceding date on which there was a
sale) on the principal national securities exchange or in the principal market on or in which
the Units are traded. In the event that the Units are not traded on such an exchange or
market at the time a determination is to be made hereunder, the determination will be made in
good faith by the Committee.

     (w) Option means the right to purchase Units upon exercise of an option granted pursuant
to Section 5.

     (x) Option Price means the purchase price per Unit payable on exercise of an Option.

     (y) Participant means a person who is selected by the Committee to receive an Award
under the Plan and who at that time is an Employee, Consultant or Eligible Director.

     (z) Performance Bonus means an Award expressed in units, where a unit is equivalent to
$1.00 (or such other value as the Committee determines) granted pursuant to Section 9.

     (aa) Performance Period means, with respect to an Award, a period of time within which
the Management Objectives relating to such Award are to be measured. The Performance Period
will be established by the Committee at the time of the Award.

     (bb) Performance Unit means a bookkeeping entry that records the equivalent of one Unit
awarded pursuant to Section 9.

     (cc) Person means an individual or a corporation, limited liability company,
partnership, joint venture, trust, unincorporated organization, association, government
agency or political subdivision thereof or other entity.

     (dd) Phantom Units means an Award granted pursuant to Section 8 or Section 10.

     (ee) Restricted Units means Units granted or sold pursuant to Section 7 as to which
neither the ownership restrictions nor the restrictions on transfer have expired.

     (ff) Rule 16b-3 means Rule 16b-3 under Section 16 of the Exchange Act as amended (or any
successor rule to the same effect), as in effect from time to time.

     (gg) Spread means the excess of the Market Value per Unit on the date an Appreciation
Right is exercised over (i) the Option Price provided for in the Option granted in tandem
with the Appreciation Right or (ii) if there is no tandem Option, the

5

 

Grant Price provided for in the Appreciation Right, in either case multiplied by the
number of Units in respect of which the Appreciation Right is exercised.

     (hh) UDR means a distribution made by the Partnership with respect to a Restricted Unit.

     (ii) Unit means a common unit of the Partnership.

     (jj) Voting Securities of the Company means the securities entitled to vote generally in
the election of directors of the Company or persons who serve similar functions.

     4. Units Available Under Plan. The aggregate number of Units that may be (i) subject to an
Award of Appreciation Rights or Options, and (ii) issued or transferred as Restricted Units and
released from all restrictions or in payment of Performance Units, Performance Shares or Phantom
Units will not exceed in the aggregate 750,000. Any Units delivered pursuant to an Award will
consist, in whole or in part, of Units acquired in the open market or from any Affiliate of the
Partnership or any other Person, newly issued Units or any combination of the foregoing, as
determined by the Committee in its discretion. The number of Units available under this Section 4
will be subject to adjustment as provided in Section 12 and will be further adjusted to include
Units that relate to Awards that (i) expire or are forfeited, (ii) are withheld or tendered in
payment of the Option Price with respect to an Option or in satisfaction of the taxes required to
be withheld in connection with any Award granted under the Plan or (iii) are subject to an
Appreciation Right that are not transferred to a Participant upon exercise of the Appreciation
Right. There will not be any limitation on the number of Awards that may be granted and paid in
cash, and any Units allocated to an Award payable in cash or Units will, to the extent paid in
cash, be again available for delivery under the Plan with respect to other Awards.

     5. Options. The Committee may from time to time authorize grants of options to any
Participant to purchase Units upon such terms and conditions as it may determine in accordance with
this Section 5. Each grant of Options may utilize any or all of the authorizations, and will be
subject to all of the requirements, contained in the following provisions:

     (a) Each grant will specify the number of Units to which it relates.

     (b) Each grant will specify the Option Price, which will not be less than 100% of the
Market Value per Unit on the Date of Grant.

     (c) Each grant will specify whether the Option Price will be payable (i) in cash or by
check acceptable to the General Partner, (ii) with the consent of the Committee, by the
actual or constructive transfer of Units owned by the Participant and having an aggregate
Market Value per Unit at the date of exercise equal to the aggregate Option Price, (iii) with
the consent of the Committee, by authorizing the withholding of a number of Units otherwise
issuable to the Participant having an aggregate Market Value per Unit on the date of exercise
equal to the aggregate Option Price or (iv) by a combination of such methods of payment;
provided, however, that the payment methods described in

6

 

clauses (ii) and (iii) will not be available at any time that the Partnership is
prohibited from purchasing or acquiring such Units.

     (d) To the extent permitted by law, any grant may provide for deferred payment of the
Option Price from the proceeds of sale through a bank or broker of some or all of the Units
to which such exercise relates.

     (e) Successive grants may be made to the same Participant whether or not any Options or
other Awards previously granted to such Participant remain unexercised or outstanding.

     (f) Each grant will specify the required period or periods of continuous service by the
Participant with the General Partner or its Affiliates that are necessary before the Options
or installments thereof will become exercisable.

     (g) Any grant may specify the Management Objectives that must be achieved as a condition
to the exercise of the Options.

     (h) Any grant may provide for the earlier exercise of the Options in the event of a
Change in Control or other similar transaction or event.

     (i) On or after the Date of Grant, the Committee may provide for the payment to the
Participant of distribution equivalents thereon in cash or Units on a current, deferred or
contingent basis.

     (j) No Options will be exercisable more than ten years from the Date of Grant, unless
the Evidence of Award provides for an extended exercise period in the event of death,
disability or retirement.

     (k) The Committee will have the right to substitute Appreciation Rights for outstanding
Options granted to one or more Participants, provided the terms and the economic benefit of
the substituted Appreciation Rights are at least equivalent to the terms and economic benefit
of such Options, as determined by the Committee in its discretion.

     (l) Any grant may provide for the effect on the Options or any Units issued, or other
payment made, with respect to the Options of any conduct of the Participant determined by the
Committee to be injurious, detrimental or prejudicial to any significant interest of the
Partnership or any of its Affiliates.

     (m) Each grant will be evidenced by an Evidence of Award, which may contain such terms
and provisions, consistent with the Plan, as the Committee may approve, including without
limitation provisions relating to the Participant’s termination of employment or other
termination of service by reason of retirement, death, disability or otherwise.

     6. Appreciation Rights. The Committee may also from time to time authorize grants to any
Participant of Appreciation Rights upon such terms and conditions as it may determine in accordance
with this Section 6. Appreciation Rights may be granted in tandem with

7

 

Options or separate and apart from a grant of Options. An Appreciation Right will be a right
of the Participant to receive from the Partnership upon exercise an amount which will be determined
by the Committee at the Date of Grant and will be expressed as a percentage of the Spread (not
exceeding 100%) at the time of exercise. An Appreciation Right granted in tandem with an Option
may be exercised only by surrender of the related Option. Each grant of an Appreciation Right may
utilize any or all of the authorizations, and will be subject to all of the requirements, contained
in the following provisions:

     (a) Each grant will state whether it is made in tandem with Options and, if not made in
tandem with any Options, will specify the number of Units in respect of which it is made.

     (b) Each grant made in tandem with Options will specify the Option Price and each grant
not made in tandem with Options will specify the Grant Price, which in either case will not
be less than 100% of the Market Value per Unit on the Date of Grant.

     (c) Any grant may provide that the amount payable on exercise of an Appreciation Right
may be paid (i) in cash, (ii) in Units having an aggregate Market Value per Unit equal to the
Spread (or the designated percentage of the Spread) or (iii) in a combination thereof, as
determined by the Committee in its discretion.

     (d) Any grant may specify that the amount payable to the Participant on exercise of an
Appreciation Right may not exceed a maximum amount specified by the Committee at the Date of
Grant.

     (e) Successive grants may be made to the same Participant whether or not any
Appreciation Rights or other Awards previously granted to such Participant remain unexercised
or outstanding.

     (f) Each grant will specify the required period or periods of continuous service by the
Participant with the General Partner or its Affiliates that are necessary before the
Appreciation Rights or installments thereof will become exercisable, and will provide that no
Appreciation Rights may be exercised except at a time when the Spread is positive and, with
respect to any grant made in tandem with Options, when the related Options are also
exercisable.

     (g) Any grant may specify the Management Objectives that must be achieved as a condition
to the exercise of the Appreciation Rights.

     (h) Any grant may provide for the earlier exercise of the Appreciation Rights in the
event of a Change in Control or other similar transaction or event.

     (i) On or after the Date of Grant, the Committee may provide for the payment to the
Participant of distribution equivalents thereon in cash or Units on a current, deferred or
contingent basis.

     (j) No Appreciation Right will be exercisable more than ten years from the Date of
Grant.

8

 

     (k) Any grant may provide for the effect on the Appreciation Rights or any Units issued,
or other payment made, with respect to the Appreciation Rights of any conduct of the
Participant determined by the Committee to be injurious, detrimental or prejudicial to any
significant interest of the Partnership or any of its Affiliates.

     (l) Each grant will be evidenced by an Evidence of Award, which may contain such terms
and provisions, consistent with the Plan, as the Committee may approve, including without
limitation provisions relating to the Participant’s termination of employment or other
termination of service by reason of retirement, death, disability or otherwise.

     7. Restricted Units. The Committee may also from time to time authorize grants or sales to
any Participant of Restricted Units upon such terms and conditions as it may determine in
accordance with this Section 7. Each grant or sale will constitute an immediate transfer of the
ownership of Units to the Participant in consideration of the performance of services, entitling
such Participant to ownership rights, but subject to the restrictions set forth in this Section 7.
Each such grant or sale may utilize any or all of the authorizations, and will be subject to all of
the requirements, contained in the following provisions:

     (a) Each grant or sale may be made without additional consideration or in consideration
of a payment by the Participant that is less than the Market Value per Unit at the Date of
Grant, except as may otherwise be required by law.

     (b) Each grant or sale may limit the Participant’s right to UDRs with respect to the
Restricted Units during the period in which the Restricted Units are subject to any such
restrictions.

     (c) Each grant or sale will provide that the Restricted Units will be subject, for a
period to be determined by the Committee at the Date of Grant, to one or more restrictions,
including without limitation a restriction that constitutes a “substantial risk of
forfeiture” within the meaning of Section 83 of the Code and the regulations of the Internal
Revenue Service under such section. Except as provided in Section 7(d) or 7(e), the
restrictions imposed on Restricted Units will not terminate at a rate that is faster than
1/3rd of the Restricted Units on each anniversary of the Date of Grant.

     (d) Any grant or sale may specify the Management Objectives that, if achieved, will
result in the termination or early termination of the restrictions applicable to the
Restricted Units, provided that the Performance Period associated with such Management
Objectives will be a period of no less than 12 calendar months.

     (e) Any grant or sale may provide for the early termination of any such restrictions in
the event of a Change in Control or other similar transaction or event or the Participant’s
termination of employment or service by reason of death, disability, retirement or otherwise.

     (f) Each grant or sale will provide that during the period for which such restriction or
restrictions are to continue, the transferability of the Restricted Units will be prohibited
or restricted in a manner and to the extent prescribed by the Committee at the

9

 

Date of Grant (which restrictions may include without limitation rights of repurchase or
first refusal in favor of the Partnership or provisions subjecting the Restricted Units to
continuing restrictions in the hands of any transferee).

     (g) Any grant or sale may provide for the effect on the Restricted Units or any Units
issued free of restrictions, or other payment made, with respect to the Restricted Units of
any conduct of the Participant determined by the Committee to be injurious, detrimental or
prejudicial to any significant interest of the Partnership or any of its Affiliates.

     (h) Each grant or sale will be evidenced by an Evidence of Award, which may contain such
terms and provisions, consistent with the Plan, as the Committee may approve, including
without limitation provisions relating to the Participant’s termination of employment or
other termination of service by reason of retirement, death, disability or otherwise.

     8. Phantom Units. The Committee may also from time to time authorize grants or sales to any
Participant of Phantom Units upon such terms and conditions as it may determine in accordance with
this Section 8. Each grant or sale of a Phantom Unit will constitute the agreement by the
Partnership to issue or transfer a Unit (or an amount in cash equal to the Market Value per Unit)
to the Participant in the future in consideration of the performance of services, subject to the
fulfillment during the Deferral Period of such conditions as the Committee may specify. Each such
grant or sale may utilize any or all of the authorizations, and will be subject to all of the
requirements, contained in the following provisions:

     (a) Each grant or sale may be made without additional consideration from the Participant
or in consideration of a payment by the Participant that is less than the Market Value per
Unit on the Date of Grant, except as may otherwise be required by law.

     (b) Each grant or sale will provide that the Phantom Units will be subject to a Deferral
Period, which will be fixed by the Committee on the Date of Grant. Except as provided in
Section 8(c), 8(d) or 10(e), the Deferral Period will not terminate at a rate that is faster
than 1/3rd of the Phantom Units on each anniversary of the Date of Grant.

     (c) Any grant or sale may specify the Management Objectives that, if achieved, will
result in the termination or early termination of the Deferral Period, provided that the
Performance Period associated with such Management Objectives will be a period of no less
than 12 calendar months.

     (d) Any grant or sale may provide for the earlier termination of the Deferral Period in
the event of a Change in Control or other similar transaction or event or the Participant’s
termination of employment or service by reason of death, disability, retirement or otherwise.

     (e) During the Deferral Period, the Participant will not have any right to transfer any
rights under the Phantom Units, will not have any rights of ownership in the Phantom Units
and will not have any right to vote the Phantom Units, but the Committee

10

 

may on or after the Date of Grant authorize the payment of DERs on such Units in cash or
Units on a current, deferred or contingent basis.

     (f) Any grant or sale may provide for the effect on the Phantom Units or any Units
issued free of restrictions, or other payment made, with respect to the Phantom Units of any
conduct of the Participant determined by the Committee to be injurious, detrimental or
prejudicial to any significant interest of the Partnership or any of its Affiliates.

     (g) Each grant or sale will be evidenced by an Evidence of Award, which will contain
such terms and provisions as the Committee may determine consistent with the Plan, including
without limitation provisions relating to the Participant’s termination of employment or
other termination of service by reason of retirement, death, disability or otherwise.

     9. Performance Units and Performance Bonuses. The Committee may also from time to time
authorize grants to Participants of Performance Units and Performance Bonuses, which will become
payable upon achievement of specified Management Objectives, upon such terms and conditions as it
may determine in accordance with this Section 9. Each such grant may utilize any or all of the
authorizations, and will be subject to all of the requirements, contained in the following
provisions:

     (a) Each grant will specify the number of Performance Units or the value of the
Performance Bonus to which it relates.

     (b) The Performance Period with respect to each Performance Unit and Performance Bonus
will be determined by the Committee at the time of grant.

     (c) Each grant will specify the Management Objectives that, if achieved, will result in
the payment of the Performance Units or Performance Bonus.

     (d) Each grant will specify the time and manner of payment of Performance Units or
Performance Bonuses which have become payable, which payment may be made in (i) cash, (ii)
Units having an aggregate Market Value per Unit equal to the aggregate value of the
Performance Units or Performance Bonuses which have become payable or (iii) any combination
thereof, as determined by the Committee in its discretion at the time of payment.

     (e) Any grant of Performance Units may specify that the amount payable with respect
thereto may not exceed a maximum specified by the Committee on the Date of Grant. Any grant
of a Performance Bonus may specify that the amount payable, or the number of Units issued,
with respect to the Performance Bonus may not exceed maximums specified by the Committee on
the Date of Grant.

     (f) On or after the Date of Grant, the Committee may provide for the payment to the
Participant of DERs on Performance Units in cash or Units on a current, deferred or
contingent basis.

11

 

     (g) Any grant may provide for the effect on the Performance Units or Performance Bonus
or any Units issued, or other payment made, with respect to the Performance Units or
Performance Bonus of any conduct of the Participant determined by the Committee to be
injurious, detrimental or prejudicial to any significant interest of the Partnership or any
of its Affiliates.

     (h) Each grant will be evidenced by an Evidence of Award, which will contain such terms
and provisions as the Committee may determine consistent with the Plan, including without
limitation provisions relating to the payment of the Performance Units or Performance Bonus
in the event of a Change in Control or other similar transaction or event and provisions
relating to the Participant’s termination of employment or other termination of service.

     10. Awards to Eligible Directors.

               (a) Each Eligible Director on the IPO Date (i) will receive a grant of Phantom Units in
lieu of cash compensation of $40,000, and (ii) may elect to receive an additional grant of
Phantom Units in lieu of additional cash compensation of $40,000.

               (b) Each individual who first becomes an Eligible Director after the IPO Date on a date
other than the first business day of a calendar year (i) will receive a grant of Phantom
Units in lieu of cash compensation of $40,000 (if the individual becomes and Eligible
Director prior to July 1 of any year) or $20,000 (if the individual becomes and Eligible
Director on or after July 1 of any year), and (ii) may elect to receive a grant of Phantom
Units in lieu of additional cash compensation of $40,000 (if the individual becomes an
Eligible Director prior to July 1 of any year) or $20,000 (if the individual becomes an
Eligible Director on or after July 1 of any year). For purposes of this Section 10(b), an
Eligible Director who ceases to be a member of the Board and thereafter becomes an Eligible
Director again will be deemed to first become an Eligible Director on the date that such
individual again becomes an Eligible Director.

               (c) On the first business day of each calendar year beginning after December 31, 2007,
each Eligible Director (i) will receive a grant of Phantom Units in lieu of cash compensation
of $40,000, and (ii) may elect to receive an additional grant of Phantom Units in lieu of
additional cash compensation of $40,000.

               (d) The number of Phantom Units to be granted to an Eligible Director under this Section
10 will be determined by dividing the amount of cash compensation the Phantom Units are
replacing by the Market Value per Unit as of (i) the IPO Date, for Phantom Units granted
under Section 10(a), (ii) the date on which the Eligible Director first becomes a member of
the Board, for Phantom Units granted under Section 10(b), and (iii) the first business day of
the applicable calendar year, for Phantom Units granted under Section 10(c). All elections
to receive a grant of Phantom Units in lieu of cash compensation will be made in accordance
with procedures established by the Committee that are designed to satisfy the deferral
election requirements under Section 409A of the Code and (A) with respect to Sections
10(a)(ii) and 10(b)(ii), must be made within 30 days after the date the Eligible Director
first becomes eligible to participate in the Plan and will

12

 

apply only to compensation paid for services performed after the election, and (B) with
respect to Section 10(c)(ii), must be made on or prior to the last day of the preceding
calendar year.

     (e) Each grant of Phantom Units made to an Eligible Director under this Section 10 may
utilize any or all of the authorizations, and will be subject to all of the requirements,
contained in the following provisions:

     (i) Each grant of Phantom Units under Section 10(a)(i), 10(b)(i) or 10(c)(i)
will become nonforfeitable as to 1/3rd of the total number of Units
subject thereto on the first business day of each of the first three calendar years
beginning after the Date of Grant; provided, in each case, that the Eligible
Director who received the Phantom Units has remained a member of the Board through
each such date.

     (ii) Each grant of Phantom Units under Section 10(a)(ii), 10(b)(ii), or
10(c)(ii) will become nonforfeitable on the first business day of the first calendar
year beginning after the Date of Grant; provided, in each case, that the Eligible
Director who received the grant of Phantom Units has remained a member of the Board
through such date.

     (iii) Except as provided in an Evidence of Award, upon an Eligible Director’s
ceasing to be a member of the Board prior to the end of a Deferral Period for any
reason, the Eligible Director will immediately forfeit all nonvested Phantom Units,
unless the Board, in its discretion, terminates the Deferral Period.

     11. Transferability. No Award may be sold, pledged, assigned or transferred in any manner
other than by will or the laws of descent and distribution or pursuant to a qualified domestic
relations order; provided, however, that a Participant who is an officer of the General Partner or
an Affiliate may, with the prior approval of the Committee, transfer an Option to family members of
the Participant, including to trusts in which family members of the Participant own more than 50%
of the beneficial interests, to foundations in which family members of the Participant or the
Participant controls the management of assets and to other entities in which more than 50% of the
voting interests are owned by family members of the Participant or the Participant. No Option or
Appreciation Right granted to a Participant will be exercisable during the Participant’s lifetime
by any Person other than the Participant or the Participant’s guardian or legal representative or
any permitted transferee.

     12. Adjustments.

     (a) The Committee will make or provide for such adjustments in (i) the maximum number of
Units specified in Section 4, (ii) the number of Units covered by outstanding Options,
Appreciation Rights, Performance Units and Restricted Units granted under the Plan, (iii) the
Option Price or Grant Price applicable to any Options and Appreciation Rights, and (iv) the
kind of securities covered by any such Awards (including securities of another issuer), as is
equitably required to prevent dilution or enlargement of the rights of Participants that
otherwise would result from (x) any

13

 

distribution (whether in the form of cash, Units, other securities or other property),
combination or exchange of Units or other securities, recapitalization or other change in the
capital structure of the Partnership, or (y) any merger, consolidation, separation, spin-off,
split-off, spin-out, split-up, reorganization, partial or complete liquidation or other
distribution of assets, issuance of rights or issuance of warrants to purchase securities, or
(z) any other corporate transaction or event having an effect similar to any of the
foregoing. In the event of any such transaction or event, the Committee, in its discretion,
may provide in substitution for any or all outstanding Awards such alternative consideration
as it, in good faith, may determine to be equitable in the circumstances and may require in
connection with such substitution the surrender of all Awards so replaced.

     (b) The Committee may accelerate the payment of, or vesting with respect to, any Award
under the Plan upon the occurrence of a transaction or event described in this Section 12;
provided, however, that in the case of any Award that constitutes a deferral of compensation
within the meaning of Section 409A of the Code, the Committee will not accelerate the payment
of the Award unless it determines in good faith that such transaction or event satisfies the
requirements of a change in control event under guidance issued by the Secretary of the
Treasury under Section 409A of the Code.

     13. Fractional Units. The Partnership will not be required to issue or deliver any fractional
Units pursuant to the Plan. The Committee may provide for the elimination of fractions or for the
settlement of fractions in cash.

     14. Withholding Taxes. To the extent that the General Partner or any of its Affiliates is
required to withhold federal, state, local or foreign taxes in connection with any payment made or
benefit realized by a Participant or other Person under the Plan, and the amounts available for
such withholding are insufficient, it will be a condition to the receipt of such payment or the
realization of such benefit that the Participant or such other Person make arrangements
satisfactory to the Partnership for payment of the balance of such taxes required to be withheld.
In addition, if permitted by the Committee, the Participant or such other Person may elect to have
any withholding obligation satisfied with Units that would otherwise be transferred to the
Participant or such other Person in payment of the Participant’s Award. However, without the
consent of the Committee, Units will not be withheld in excess of the minimum number of Units
required to satisfy the withholding obligation.

     15. Administration of the Plan.

     (a) The Plan will be administered by the Board, unless the Board appoints a committee consisting of
two or more directors of the Board, each of whom is intended to qualify as a “non-employee
director” as defined in Rule 16b-3, to administer the Plan. Notwithstanding the foregoing, the
provisions of Section 10 will be administered by the Board.

     (b) A majority of the Committee will constitute a quorum, and the action of the members
of the Committee present at any meeting at which a quorum is present, or acts unanimously
approved in writing, will be the acts of the Committee.

     (c) The Committee has the full authority and discretion to administer the Plan and to
take any action that is necessary or advisable in connection with the administration of the
Plan, including without limitation the authority and discretion to interpret and

14

 

construe any provision of the Plan or of any agreement, notification or document
evidencing an Award. The interpretation and construction by the Committee of any such
provision and any determination by the Committee pursuant to any provision of the Plan or of
any such agreement, notification or document will be final and conclusive. No member of the
Committee will be liable for any such action or determination made in good faith.

     (d) To the extent permitted by applicable law, the Committee may delegate its authority
under the Plan to a subcommittee of the Committee, to one or more committees of the Board or
to one or more executive officers of the Company; provided, however, that no delegation may
be made of authority to take an action which is required by Rule 16b-3 to be taken by
“non-employee directors” in order that the Plan and transactions thereunder meet the
requirements of such Rule.

     (e) It is the Committee’s intention that any Award granted under the Plan that
constitutes a deferral of compensation within the meaning of Section 409A of the Code and the
guidance issued by the Secretary of the Treasury under Section 409A satisfy the requirements
of Section 409A of the Code. In granting such an Award, the Committee will use its best
efforts to exercise its authority under the Plan with respect to the terms of such Award in a
manner that the Committee determines in good faith will cause the Award to comply with
Section 409A of the Code and thereby avoid the imposition of penalty taxes and interest upon
the Participant receiving the Award.

     (f) If no committee is established by the Board pursuant to
Section 15(a) and, in any event, with respect to the administration of the provisions of
Section 10, the Board
will have the same authority, power, duties, responsibilities and discretion given to the
Committee under the terms of the Plan.

     16. Amendments and Other Matters.

     (a) The Plan may be amended from time to time by the Board or, with respect to those
provisions of the Plan other than Section 10, the Committee; provided, however, that the Plan
may not be amended without further approval by the unitholders of the Partnership if such
amendment would result in the Plan no longer satisfying any applicable requirements of the
NYSE Arca (or the principal national securities exchange on which the Units are traded) or
Rule 16b-3.

     (b) Neither the Committee nor the Board will authorize the amendment of any outstanding
Option to reduce the Option Price without the further approval of the unitholders of the
Partnership. Furthermore, no Option will be cancelled and replaced with Options having a
lower Option Price without further approval of the unitholders of the Partnership. The
provisions of this Section 16(b) are intended to prohibit the repricing of “underwater”
Options and will not be construed to prohibit the adjustments provided for in Section 12.

     (c) The Plan may be terminated at any time by action of the Board. The termination of
the Plan will not adversely affect the terms of any outstanding Award.

15

 

     (d) No Units will be issued under the Plan prior to (i) the obtaining of any approval
from any governmental agency which the General Partner, in its sole discretion, determines to
be necessary or advisable, (ii) the admission of such Units to listing on any securities
exchange on which the Units may then be listed, and (iii) the completion of any registration
or other qualification of such Units under any state or Federal law or rulings or regulations
of any governmental body which the General Partner, in its sole discretion, determines to be
necessary or advisable.

     (e) The Plan does not confer upon any Participant any right with respect to continuance
of employment or other service with the General Partner or any of its Affiliates, nor will it
interfere in any way with any right the General Partner or any of its Affiliates would
otherwise have to terminate such Participant’s employment or other service at any time.

     (f) To the extent that the Partnership has an obligation to reimburse the General
Partner or one of its Affiliates for compensation paid to Consultants and Employees for
services rendered for the benefit of the Partnership, such payments or reimbursement payments
may be made by the Partnership directly to the General Partner or its Affiliate and, if made
to the General Partner with respect to an Affiliate, will be received by the General Partner
as agent for the Affiliate.

     17. Governing Law. The Plan, all Awards and all actions taken under the Plan and the Awards
will be governed in all respects in accordance with the laws of the State of Delaware, including
without limitation the Delaware statute of limitations, but without giving effect to the principles
of conflicts of laws of such State.

16exv10w5

 

Exhibit 10.5

SERVICES AND SECONDMENT AGREEMENT

     This Services and Secondment Agreement (the “Agreement”), dated as of [ ], 2007
(the “Effective Date”), is entered into between QUICKSILVER RESOURCES INC.
(“Company”), a Delaware corporation, and QUICKSILVER GAS SERVICES GP LLC (“MLP
GP”), a Delaware limited liability company, the general partner of Quicksilver Gas Services LP
(“Partnership”). Company and MLP GP are hereinafter each referred to as a “Party”
and collectively referred to as the “Parties.” The Partnership and the MLP GP are
sometimes collectively referred to as the “Partnership Entities.”

RECITALS:

     WHEREAS, Company will provide to MLP GP the services necessary to operate, manage and maintain
the Partnership’s approximately 120 mile natural gas gathering pipeline system located in the
southern portion of the Fort Worth Basin (the “Cowtown Pipeline”) and the Partnership’s
natural gas processing plant, consisting of a newly-constructed 125 MMcf/d natural gas processing
unit and a 75 MMcf/d natural gas processing unit, located in Hood County, Texas (the “Cowtown
Plant,” together with the Cowtown Pipeline and any subsequent additions to or expansions of the
Cowtown Pipeline or Cowtown Plant, the “Cowtown Assets”);

     WHEREAS, in connection with the provision of the services under this Agreement, Company
desires to second to MLP GP certain personnel employed or contracted by Company in connection with
the Cowtown Assets;

     NOW THEREFORE, in consideration of the premises and the mutual covenants and agreements
contained herein, and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, Company and MLP GP hereby agree as follows:

ARTICLE 1

SECONDMENT

1.1 Seconded Employees.

     Subject to the terms of this Agreement, Company agrees to second to MLP GP, and MLP GP agrees
to accept the secondment of, those certain specifically identified individuals (each, a
“Seconded Employee” and collectively, the “Seconded Employees”) listed on
Exhibit A (the “Seconded Employee Schedule”) for the purpose of performing job
functions related to the Cowtown Assets (the “Secondment”). The Seconded Employees will
remain at all times employees of the Company but in addition, they will also be temporary employees
of MLP GP during the Period of Secondment and shall, at all times during the Period of Secondment,
work under the direction, supervision and control of MLP GP. The Company will retain the right to
hire or discharge the Seconded Employees but, subject to the provisions in Section 1.2, will not
have the right to terminate the Secondment to MLP GP or otherwise exercise direction, supervision
or control over the Seconded Employees. For each Seconded Employee, the “Period of
Secondment” shall be that period of time as set forth in Section 1.2. Seconded Employees shall
have no authority or apparent authority to act on behalf of Company during the Period of
Secondment. The Seconded Employee Schedule sets forth the names of the Seconded Employees

 

 

seconded by Company, the job functions of the Seconded Employees, and the starting date for
the Period of Secondment for each Seconded Employee. Individuals may be added or removed from the
Seconded Employee Schedule from time to time by the execution by the Parties of a completed
“Addition/Removal/Change of Responsibility of Seconded Employee” form, the form of which is
attached to this Agreement as Exhibit B, which will be fully binding on the Parties for all
purposes under this Agreement. Those rights and obligations of the Parties under this Agreement
that relate to individuals that were on the Seconded Employee Schedule but then later removed from
the Seconded Employee Schedule, which rights and obligations accrued before the removal of such
individual, will survive the removal of such individual from the Seconded Employee Schedule to the
extent necessary to enforce such rights and obligations.

1.2 Period of Secondment.

     Company will second to MLP GP each Seconded Employee on the start date set forth on the
Seconded Employee Schedule and continue to second, during the period (and only during the period)
that the Seconded Employee is performing services for MLP GP, until the earliest of:

     (a) the end of the term of this Agreement;

     (b) the end date, if any, set forth for the Seconded Employee on the Seconded Employee
Schedule (or another end date for such Seconded Employee as mutually agreed in writing by the
Parties) (the “End Date”);

     (c) a withdrawal, departure, resignation or termination of such Seconded Employee under
Section 1.3;

     (d) the date on which Quicksilver Gas Holdings LLC ceases to own a majority of the issued and
outstanding voting common equity capital of MLP GP and MLP GP has entered into satisfactory
arrangements which in good faith MLP GP determines will provide MLP GP with suitable qualified and
experienced full-time or seconded employees necessary to operate, manage and maintain the Cowtown
Assets; and

     (e) a termination of Secondment for such Seconded Employee under Section 1.4.

     At the end of the Period of Secondment for any Seconded Employee, such Seconded Employee will
no longer be subject to the direction of MLP GP with regard to the Seconded Employee’s day-to-day
activities.

1.3 Withdrawal, Departure or Resignation.

     Company will use reasonable efforts to prevent any early withdrawal, departure or resignation
of any Seconded Employee prior to the End Date for such Seconded Employee’s Period of Secondment.
If any Seconded Employee tenders his resignation to Company as an employee of Company, Company will
promptly notify MLP GP. During the Period of Secondment for any Seconded Employee, Company will not
voluntarily withdraw or terminate any Seconded Employee except with the written consent of MLP GP
(which may be through the execution of a completed Addition/Removal/Change of Responsibility of
Seconded Employee

-2-

 

form), such consent not to be unreasonably withheld. Company will indemnify, defend and hold
harmless MLP GP, its directors, officers and employees against any and all costs, expenses
(including reasonable attorneys’ fees), claims, demands, losses, liabilities, obligations, actions,
lawsuits and other proceedings, judgments and awards (each, a “Loss” and collectively, the
“Losses”) arising out of or in any way connected with or related to the termination of
employment of the Seconded Employee by Company without the consent of the MLP GP EVEN THOUGH SUCH
LOSS MAY BE CAUSED IN PART BY THE NEGLIGENCE OF ONE OR MORE OF THE PARTNERSHIP ENTITIES, except to
the extent that such Losses (i) arise solely out of or result solely from the negligence, gross
negligence or willful misconduct of any of the Partnership Entities, or (ii) arise in connection
with the termination of a Seconded Employee for cause. Upon the termination of employment, the
Seconded Employee will cease performing services for MLP GP.

1.4 Termination of Secondment.

     MLP GP will have the right to terminate the Secondment to MLP GP of any Seconded Employee for
any reason at any time. Subject to Section 1.2, Company will not have the right to terminate the
Secondment to MLP GP of any Seconded Employee. Upon the termination of any Seconded Employee’s
Period of Secondment, Company will be solely liable for any costs or expenses associated with the
termination of the Secondment, except as otherwise specifically set forth in this Agreement.
Company will indemnify, defend and hold harmless MLP GP, its directors, officers and employees
against all Losses arising out of or in any way connected with the termination of Secondment of the
Seconded Employee by MLP GP EVEN THOUGH SUCH LOSS MAY BE CAUSED IN PART BY THE NEGLIGENCE OF ONE OR
MORE OF THE PARTNERSHIP ENTITIES, except to the extent that such Losses arise solely out of or
result solely from the negligence, gross negligence or willful misconduct of any of the Partnership
Entities. Upon the termination of a Secondment, the Seconded Employee will cease performing
services for MLP GP. At no time will MLP GP have the right to terminate the employment with the
Company of the Seconded Employees.

1.5 Supervision.

     During the Period of Secondment, MLP GP shall:

     (a) be ultimately and fully responsible for the daily work assignments of the Seconded
Employee (and with respect to Seconded Employees that also provide services to the Company in
connection with its operations (“Shared Seconded Employees”) during those times that the
Shared Seconded Employees are performing services for MLP GP hereunder), including supervision of
their day-to-day work activities and performance consistent with the purposes stated in Section 1.1
and the job functions set forth in the Seconded Employee Schedule;

     (b) set the hours of work and the holidays and vacation schedules (other than with respect to
Shared Seconded Employees, as to which MLP GP and Company shall jointly determine) for the Seconded
Employee; and

     (c) have the right to determine training which will be received by the Seconded Employee.

-3-

 

     In the course and scope of performing any Seconded Employee’s job functions, the Seconded
Employee will be integrated into the organization of MLP GP, will report into MLP GP’s management
structure, and will be under the direct management and supervision of MLP GP. MLP GP shall
designate one of its officers who does not also provide services to the Company in connection with
the Company’s operations to be responsible for the supervisory function set forth in this Section
1.5 on behalf of MLP GP.

1.6 Seconded Employee Qualifications; Approval.

     Company will provide such suitably qualified and experienced Seconded Employees as Company is
able to make available to MLP GP, and MLP GP will have the right to approve or reject such Seconded
Employee.

ARTICLE 2

SECONDMENT SERVICES

2.1 Secondment Services.

     Company shall second Seconded Employees to MLP GP to provide MLP GP with those services
necessary to operate, manage and maintain the Cowtown Assets (the “Secondment Services”).

2.2 Cancellation or Reduction of Secondment Services.

     MLP GP may terminate or reduce the level of any of the Secondment Services on 30 days’ prior
written notice to Company. In the event MLP GP terminates the Secondment Services, MLP GP shall pay
Company the monthly installment for the last month (or portion thereof) in which it received such
services. Upon payment thereof, MLP GP shall have no further payment obligations. In the event that
MLP GP reduces the level of any of the Secondment Services, the Parties will negotiate in good
faith to determine an appropriate Services Reimbursement (as defined in Section 3.1 below) for the
reduced Secondment Services.

2.3 Workers’ Compensation.

     At all times, the Company will maintain workers’ compensation insurance applicable to the
Seconded Employees. The Company wil name MLP GP as an also insured employer under such insurance
policy. Prior to being assigned any duties by MLP GP, each Seconded Employee must sign an
acknowledgement that the Seconded Employee is an employee during the Secondment Period of both the
Company and MLP GP and that for any work place injury, the Seconded Employee’s sole remedy will be
under the Company’s workers’ compensation insurance policy.

-4-

 

ARTICLE 3

SERVICES REIMBURSEMENT

3.1 Operational, Management, and Routine Maintenance Expenses.

     On or before the fifth business day of each month, Company shall send an invoice to MLP GP for
that amount of money associated with all expenses incurred by Company in connection with the
performance of the Secondment Services during the preceding month (the “Services
Reimbursement”). MLP GP shall pay such invoice within 45 days of receipt.

3.2 Seconded Employees.

     Among other items, the Services Reimbursement shall include all reasonable costs and expenses
incurred by the Company for the Seconded Employees, including, but not limited to:

	 	(i)	 	compensation, salary, and wages (including payroll and
withholding taxes associated therewith) ;
	 
	 	(ii)	 	401(k) costs and any matching 401(k) contributions;
	 
	 	(iii)	 	vacation and sick leave benefits;
	 
	 	(iv)	 	medical and health insurance benefits;
	 
	 	(v)	 	disability insurance;
	 
	 	(vi)	 	workers’ compensation insurance;
	 
	 	(vii)	 	life insurance;
	 
	 	(viii)	 	severance payments, if any;
	 
	 	(ix)	 	and any other employee benefit for which Company incurs costs

     The costs and expenses described in (i) through (viii) above are referred to as “Seconded
Employee Expenses.”

ARTICLE 4

ALLOCATION; RECORDS; AGENT

4.1 Allocation; Records.

     Company will use commercially reasonable efforts to maintain an allocation schedule reflecting
the direct and indirect costs of the Seconded Employee Expenses based on the Secondment Services.
MLP GP will use commercially reasonable efforts to keep and maintain books/records reflecting hours
worked and costs and expenses incurred in connection with each of the Seconded Employees, and the
Company will have the right from time to time upon its

-5-

 

reasonable request to audit such books/records maintained by MLP GP. MLP GP and its
representatives will have the right to audit such records and such other records as MLP GP may
reasonably require in connection with its verification of the Seconded Employee Expenses during
regular business hours and on reasonable prior notice. Based on these records, MLP GP may request
the adjustments under Section 3.2 above.

4.2 Agent.

     Seconded Employee Expenses remain the primary legal responsibility of MLP GP as the employer
of the Seconded Employees during the Secondment Period. Company agrees to act as agent for MLP GP
in paying the Seconded Employee Expenses of the employees temporarily assigned under this
Secondment Agreement. Company agrees to indemnify and hold MLP GP harmless from any and all Losses
incurred by MLP GP or any of the other Partnership Entities related to Company’s failure to carry
out its duties as agent for the payment of the Seconded Employee Expenses as set forth above,
except to the extent that such Losses arise solely out of or result solely from the negligence,
gross negligence or willful misconduct of any of the Partnership Entities.

ARTICLE 5

TERM

     The term of this Agreement will commence on the Effective Date and will continue for an
initial period of 10 years. Upon the expiration of the initial 10 year period, the term of this
Agreement shall automatically extend for an additional 12 month period, unless either Party
provides at least 180 days’ prior written notice to the other Party prior to the expiration of such
initial period that the Party wishes for this Agreement to expire at the end of the initial 10 year
period. After the initial 12 month renewal period, the term of this Agreement shall automatically
extend for additional 12 month periods, unless either Party provides prior written notice at least
180 days prior to the expiration of the applicable 12 month period that the Party wishes for this
Agreement to expire at the end of such 12 month period. Upon proper notice by a Party to the other
Party, in accordance with this Article 5, that the Party wishes for this Agreement to expire on the
expiration of the applicable 10 year or 12 month period, this Agreement shall not automatically
extend, but shall instead expire upon the expiration of the 10 year or 12 month period and only
those provisions that, by their terms, expressly survive this Agreement shall so survive.
Notwithstanding the foregoing, MLP GP may terminate this agreement at any time upon 180 days prior
written notice to Company and only those provisions that, by their terms, expressly survive this
Agreement shall so survive.

ARTICLE 6

GENERAL PROVISIONS

6.1 Accuracy of Recitals.

     The paragraphs contained in the recitals to this Agreement are incorporated in this Agreement
by this reference, and the Parties to this Agreement acknowledge the accuracy thereof.

-6-

 

6.2 Notices.

     Any notice, demand, or communication required or permitted under this Agreement shall be in
writing and delivered personally, by reputable courier, or by telecopier, and shall be deemed to
have been duly given as of the date and time reflected on the delivery receipt if delivered
personally or sent by reputable courier service, or on the automatic telecopier receipt if sent by
telecopier, addressed as follows:

Quicksilver Resources Inc.

777 West Rosedale Street, Suite 300

Fort Worth, Texas 76104

Attn: [                    ]

Telecopy: [                    ]

Quicksilver Gas Services GP LLC

777 West Rosedale Street, Suite 300

Fort Worth, Texas 76104

Attn: [                    ]

Telecopy: [                    ]

     A Party may change its address for the purposes of notices hereunder by giving notice to the
other Party specifying such changed address in the manner specified in this Section 6.2.

6.3 Further Assurances.

     The Parties agree to execute such additional instruments, agreements and documents, and to
take such other actions, as may be necessary to effect the purposes of this Agreement.

6.4 Modifications.

     Any actions or agreement by the Parties to modify this Agreement, in whole or in part, shall
be binding upon the Parties, so long as such modification shall be in writing and shall be executed
by all Parties with the same formality with which this Agreement was executed.

6.5
Interpretation.

     In this Agreement, unless a clear contrary intention appears: (a) the singular includes the
plural and vice versa; (b) reference to any individual, or any partnership, corporation, limited
liability company, trust or other legal entity (“Person”) includes such Person’s successors and
assigns but, in the case of Party, only if such successors and assigns are permitted by this
Agreement, and reference to a Person in a particular capacity excludes such Person in any other
capacity; (c) reference to any gender includes each other gender; (d) reference to any agreement
(including this Agreement), document or instrument means such agreement, document, or instrument as
amended or modified and in effect from time to time in accordance with the terms thereof and, if
applicable, the terms of this Agreement; (e) reference to any Section means such Section of this
Agreement, and references in any Section or definition to any clause means such

-7-

 

clause of such Section or definition; (f) “hereunder,” “hereof,” “hereto” and words of similar
import will be deemed references to this Agreement as a whole and not to any particular Section or
other provision hereof or thereof; (g) “including” (and with correlative meaning “include”) means
including without limiting the generality of any description preceding such term; and (h) relative
to the determination of any period of time, “from” means “from and including,” “to” means “to but
excluding” and “through” means “through and including.”

6.6 Titles and Headings.

     Section titles and headings in this Agreement are inserted for convenience of reference only
and are not intended to be a part of, or to affect the meaning or interpretation of, this
Agreement.

6.7 No Third Party Beneficiaries.

     No Person not a Party to this Agreement will have any rights under this Agreement as a third
party beneficiary or otherwise, including, without limitation, Seconded Employees.

6.8 Relationship of the Parties.

     (a) Nothing in this Agreement will constitute the Partnership Entities, Company or its
Affiliates as members of any partnership, joint venture, association, syndicate or other entity.

     (b) As used in this Agreement, “Affiliate” means, with respect to any Person, (a) any other
Person directly or indirectly controlling, controlled by or under common control with such Person,
(b) any Person owning or controlling fifty percent (50%) or more of the voting interests of such
Person, (c) any officer or director of such Person, or (d) any Person who is the officer, director,
trustee, or holder of fifty percent (50%) or more of the voting interest of any Person described in
clauses (a) through (c). For purposes of this definition, the term “controls,” “is controlled by”
or “is under common control with” shall mean the possession, direct or indirect, of the power to
direct or cause the direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise. For purposes of this Agreement, no
Partnership Entities shall be deemed to be an Affiliate of Company nor shall Company be deemed to
be an Affiliate of any Partnership Entities.

6.9 Assignment.

     Neither Party will, without the prior written consent of the other Party, which consent shall
not be unreasonably withheld, assign, mortgage, pledge or otherwise convey this Agreement or any of
its rights or duties hereunder; provided, however, that either Party may assign or convey this
Agreement without the prior written consent of the other Party to an Affiliate. Unless written
consent is not required under this Section 6.9, any attempted or purported assignment, mortgage,
pledge or conveyance by a Party without the written consent of the other Party shall be void and of
no force and effect. No assignment, mortgage, pledge or other conveyance by a Party shall relieve
the Party of any liabilities or obligations under this Agreement.

-8-

 

6.10 Binding Effect.

     This Agreement will be binding upon, and will inure to the benefit of, the Parties and their
respective successors, permitted assigns and legal representatives.

6.11 Counterparts.

     This Agreement may be executed in any number of counterparts, each of which will be deemed to
be an original, and all of which together shall constitute one and the same Agreement. Each Party
may execute this Agreement by signing any such counterpart.

6.12
Time of the Essence.

     Time is of the essence in the performance of this Agreement.

6.13
Governing Law.

     This Agreement shall be deemed to be a contract made under, and for all purposes shall be
construed in accordance with and governed by, the laws of the State of Texas.

6.14 Delay or Partial Exercise Not Waiver.

     No failure or delay on the part of any Party to exercise any right or remedy under this
Agreement will operate as a waiver thereof; nor shall any single or partial exercise of any right
or remedy under this Agreement preclude any other or further exercise thereof or the exercise of
any other right or remedy granted hereby or any related document. The waiver by either Party of a
breach of any provisions of this Agreement will not constitute a waiver of a similar breach in the
future or of any other breach or nullify the effectiveness of such provision.

6.15 Entire Agreement.

     This Agreement constitutes and expresses the entire agreement between the Parties with respect
to the subject matter hereof. All previous discussions, promises, representations and
understandings relative thereto are hereby merged in and superseded by this Agreement.

6.16 Waiver.

     To be effective, any waiver or any right under this Agreement will be in writing and signed by
a duly authorized officer or representative of the Party bound thereby.

6.17 Signatories Duly Authorized.

     Each of the signatories to this Agreement represents that he is duly authorized to execute
this Agreement on behalf of the Party for which he is signing, and that such signature is
sufficient to bind the Party purportedly represented.

-9-

 

6.18 Incorporation of Exhibits by References.

     Any reference herein to any exhibit to this Agreement will incorporate it herein, as if it
were set out in full in the text of this Agreement.

6.19 Dispute Resolution and Arbitration.

     (a) Should a dispute arise between the Parties, the Parties shall promptly seek to amicably
resolve any such dispute by negotiations between the Parties prior to the initiation of binding
arbitration in accordance with Section 6.19(b). The Parties shall meet at a mutually acceptable
time and place within fifteen (15) days and thereafter as often as they reasonably determine to be
necessary or appropriate to exchange relevant information and to attempt to resolve the dispute.
All negotiations and communications pursuant to this Section 6.19(a) shall be treated and
maintained by the Parties as confidential information and shall be treated as compromise and
settlement negotiations for purposes of the Federal Rules of Evidence. Any proposed resolution of a
dispute under this Agreement must be approved on behalf of the Partnership by the Conflicts
Committee of the Board of Directors of MLP GP before it is finalized. If the matter is not resolved
within 30 days after the initial meeting of the Parties, or such longer period as may be mutually
agreed upon, either Party may initiate arbitration in accordance with Section 6.19(b).

     (b) Any disputes hereunder, including the inability of the Parties to agree to an adjustment
to the Services Reimbursements pursuant to the provisions of Section 3.1, must be resolved through
the use of binding arbitration using three arbitrators, in accordance with the Commercial
Arbitration Rules of the American Arbitration Association, as supplemented to the extent necessary
to determine any procedural appeal questions by the Federal Arbitration Act (Title 9 of the United
States Code). If there is any inconsistency between this Section and the Commercial Arbitration
Rules or the Federal Arbitration Act, the terms of this Section 6.19 will control the rights and
obligations of the Parties. Arbitration must be initiated within the applicable time limits set
forth in this Agreement and not thereafter or if no time limit is given, within the time period
allowed by the applicable statute of limitations. Arbitration may be initiated by a party
(“Claimant”) serving written notice on the other party (“Respondent”) that the
Claimant elects to refer a particular dispute to binding arbitration. Claimant’s notice initiating
binding arbitration must identify the arbitrator Claimant has appointed. The Respondent shall
respond to Claimant within 30 days after receipt of Claimant’s notice, identifying the arbitrator
Respondent has appointed. If the Respondent fails for any reason to name an arbitrator within the
30-day period, Claimant shall petition to the American Arbitration Association for appointment of
an arbitrator for Respondent’s account. The two arbitrators so chosen shall select a third
arbitrator within 30 days after the second arbitrator has been appointed. The Claimant will pay the
compensation and expenses of the arbitrator named by or for it, and the Respondent will pay the
compensation and expenses of the arbitrator named by or for it. The costs of petitioning for the
appointment of an arbitrator, if any, shall be paid by Respondent. The Claimant and Respondent will
each pay one-half of the compensation and expenses of the third arbitrator. All arbitrators must
(a) be neutral parties who have never been officers, directors or employees of any of the
Partnership Entities, Company or its Affiliates and (b) have not less than seven years experience
in the energy industry. The hearing will be conducted in Fort Worth, Texas and commence within 30
days after the selection of the third arbitrator. The Parties and the

-10-

 

arbitrators should proceed diligently and in good faith in order that the award may be made as
promptly as possible. Except as provided in the Federal Arbitration Act, the decision of the
arbitrators will be binding on and non-appealable by the parties hereto. The arbitrators shall have
no right to grant or award indirect, consequential, punitive or exemplary damages of any kind.

6.20 Continuation of Work During Dispute.

     Subject to Section 2.2 hereof, notwithstanding any dispute, it shall be the responsibility of
each Party to continue to perform its obligations under this Agreement pending resolution of the
dispute.

[Signature page follows]

-11-

 

     AS WITNESS HEREOF, the Parties have caused this Agreement to be executed by their duly
authorized representatives on the date herein above mentioned.

	 	 	 	 	 
	 
	 	 	 	 
	 	 	QUICKSILVER RESOURCES INC.
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	 	 	 
	 

	 	Title:	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	QUICKSILVER GAS SERVICES GP LLC
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	 	 	 
	 

	 	Title:	 	 
	 

	 	 	 	 

 

 

EXHIBIT A TO THE

SERVICES AND SECONDMENT AGREEMENT

     This Exhibit A is attached the Services and Secondment Agreement (the “Agreement”)
dated [ ], 2007 by and between QUICKSILVER RESOURCES INC. and QUICKSILVER GAS SERVICES GP
LLC. All defined terms used herein shall have the same meaning as set forth in the Agreement.

     All information must be filled in for this form to be valid.

SECONDED EMPLOYEE SCHEDULE

	 	 	 	 	 	 	 	 	 
	 
	 	Name of Seconded Employee	 	 	Title and Job Function	 	 	Start Date	 
	 	 
	 	 	 	 	 	 	 
	 	 

	 	 	 
	 	 	 	 
	 	 
	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	QUICKSILVER RESOURCES INC.	 	 	 	QUICKSILVER GAS SERVICES GP LLC
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	By:	 	 
	 

	 	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Name:

	 	 	 	 	 	Name:	 	 
	 

	 	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Title:

	 	 	 	 	 	Title:	 	 
	 

	 	 
	 	 	 	 	 	 

-13- 

 

EXHIBIT B TO THE

SERVICES AND SECONDMENT AGREEMENT

     This Exhibit B is attached the Services and Secondment Agreement (the “Agreement”)
dated [             ], 2007 by and between QUICKSILVER RESOURCES INC. and QUICKSILVER GAS SERVICES GP
LLC. All defined terms used herein shall have the same meaning as set forth in the Agreement.

ADDITION/REMOVAL/CHANGE OF RESPONSIBILITY

OF SECONDED EMPLOYEE

     In accordance with Section 1.1 of the Secondment Agreement, the Parties hereto wish to add,
remove, or change the responsibilities of the following Seconded Employees.

     All information must be filled in for this form to be valid.

	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	Name of Seconded Employee	 	 	Title and Job Function	 	 	Start Date	 	 	End Date	 
	 	 
	 	 	 	 	 	 	 	 	 	 
	 	 

	 	 	 
	 	 	 
	 	 	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	QUICKSILVER RESOURCES INC.	 	 	 	QUICKSILVER GAS SERVICES GP LLC
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	By:	 	 
	 

	 	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Name:

	 	 	 	 	 	Name:	 	 
	 

	 	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Title:

	 	 	 	 	 	Title:	 	 
	 

	 	 
	 	 	 	 	 	 

-14-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00126-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00126-of-00352.parquet"}]]