Document:

Exhibit 10.1

 

Confidential Treatment has been requested for the redacted portions of this agreement. The redactions are indicated with six asterisks (******). A complete version of this agreement has been filed separately with the Securities and Exchange Commission.

 

EXECUTION VERSION

 

FOURTH AMENDMENT

 

TO

 

THIRD AMENDED AND RESTATED OMNIBUS AGREEMENT

 

AMONG

 

EXTERRAN HOLDINGS, INC.

 

EXTERRAN ENERGY SOLUTIONS, L.P.

 

EXTERRAN GP LLC

 

EXTERRAN GENERAL PARTNER, L.P.

 

EXTERRAN PARTNERS, L.P.

 

AND

 

EXLP OPERATING LLC

 

 

FOURTH AMENDMENT TO

THIRD AMENDED AND RESTATED

OMNIBUS AGREEMENT

 

This Fourth Amendment (this “Amendment”) to the Third Amended and Restated Omnibus Agreement is entered into on August 15, 2014, and is by and among Exterran Holdings, Inc., a Delaware corporation (“Exterran”), Exterran Energy Solutions, L.P., a Delaware limited partnership (“EESLP”), Exterran GP LLC, a Delaware limited liability company (“GP LLC”), Exterran General Partner, L.P., a Delaware limited partnership (the “General  Partner”), Exterran Partners, L.P., a Delaware limited partnership (the “Partnership”), and EXLP Operating LLC, a Delaware limited liability company (the “Operating Company”).  The above-named entities are sometimes referred to in this Amendment collectively as the “Parties.”

 

RECITALS:

 

The Parties entered into that certain Third Amended and Restated Omnibus Agreement dated as of June 10, 2011, as amended by that certain First Amendment to the Third Amended and Restated Omnibus Agreement dated as of March 8, 2012, that certain Second Amendment to the Third Amended and Restated Omnibus Agreement dated as of March 31, 2013 and that certain Third Amendment to the Third Amended and Restated Omnibus Agreement dated as of April 10, 2014 (as so amended, the “Omnibus Agreement”). Capitalized terms used but not defined herein have the respective meanings set forth in the Omnibus Agreement.

 

The Parties desire to amend the Omnibus Agreement to evidence their agreement to modify the fixed margin percentage set forth on Schedule 1.1 to the Omnibus Agreement relating to the maximum purchase price to be paid by any member of the Partnership Group for newly fabricated Compression Equipment from an Affiliate of Exterran (other than any member of the Partnership Group).

 

The Conflicts Committee of the Board of Directors of GP LLC has approved the form, terms and substance of this Amendment in accordance with the requirements set forth in Section 8.6 of the Omnibus Agreement.

 

For good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:

 

1.                                      Omnibus Agreement Amendment.

 

(a)                             The definition of “Fixed Margin Amount” in Section 1.1(b) is hereby replaced in its entirety with the following:

 

“‘Fixed Margin Amount’ means the amount resulting from the product of (i) the Fabricated Cost and (ii) the percentage, expressed as a decimal, set forth on Schedule 1.1 to this Agreement, which Schedule may be amended from time to time with the approval of the Conflicts Committee; provided, that the Conflicts Committee and representatives of Exterran shall review the Fixed Margin Amount at least annually to determine whether an amendment to Schedule 1.1 is appropriate.”

 

(b)                                 Schedule 1.1 is replaced in its entirety with the attached Schedule 1.1.

 

 

2.                                      Acknowledgement.  Except as amended hereby, the Omnibus Agreement shall remain in full force and effect as previously executed, and the Parties hereby ratify the Omnibus Agreement as amended hereby.

 

3.                                      Counterparts.   This Amendment may be executed in one or more counterparts, all of which shall be considered one and the same agreement, and shall become effective when one or more counterparts have been signed by each of the Parties hereto and delivered (including by facsimile) to the other Parties.

 

[Signature page follows.]

 

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IN WITNESS WHEREOF, the Parties have executed this Amendment on, and effective as of, the date first set forth above.

 

	
 
    	
EXTERRAN HOLDINGS, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Daniel K. Schlanger
    
	
 
    	
Name:
    	
Daniel K. Schlanger
    
	
 
    	
Title:
    	
Senior Vice President, Operations Services
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
EXTERRAN ENERGY SOLUTIONS, L.P.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Daniel K. Schlanger
    
	
 
    	
Name:
    	
Daniel K. Schlanger
    
	
 
    	
Title:
    	
Senior Vice President, Operations Services
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
EXTERRAN GP LLC
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ David S. Miller
    
	
 
    	
Name:
    	
David S. Miller
    
	
 
    	
Title:
    	
Senior Vice President and Chief Financial   Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
EXTERRAN GENERAL PARTNER, L.P.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
Exterran GP LLC,
    
	
 
    	
 
    	
its general partner
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ David S. Miller
    
	
 
    	
Name:
    	
David S. Miller
    
	
 
    	
Title:
    	
Senior Vice President and Chief Financial   Officer
    

 

[Signature page to the Fourth Amendment to the Third Amended and Restated Omnibus Agreement]

 

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EXTERRAN PARTNERS, L.P.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
Exterran General Partner, L.P.,
    
	
 
    	
 
    	
its general partner
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
Exterran GP LLC,
    
	
 
    	
 
    	
its general partner
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ David S. Miller
    
	
 
    	
Name:
    	
David S. Miller
    
	
 
    	
Title:
    	
Senior Vice President and Chief Financial   Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
EXLP OPERATING LLC
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ David S. Miller
    
	
 
    	
Name:
    	
David S. Miller
    
	
 
    	
Title:
    	
Senior Vice President and Chief Financial   Officer
    

 

[Signature page to the Fourth Amendment to the Third Amended and Restated Omnibus Agreement

 

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Schedule 1.1

 

Fixed Margin Percentage

 

******, effective as of July 1, 2014Exhibit 10.2

 

 

September 10, 2014

 

Jon C. Biro

15 Warrenton Drive

Houston, Texas 77024

 

Re:                             Employment Terms

 

Dear Jon:

 

On behalf of Exterran Holdings, Inc., a Delaware corporation (the “Company”), I am pleased to offer you the position of Senior Vice President and Chief Financial Officer of the Company, effective as of September 22, 2014 (the “Effective Date”), on the terms and conditions set forth below.

 

1.   POSITIONS, DUTIES AND RESPONSIBILITIES.  As of the Effective Date, you will serve as Senior Vice President and Chief Financial Officer of the Company, and will have such duties and responsibilities as are usual and customary for your position.  You will report directly to the President and Chief Executive Officer of the Company, and will work at our offices located in Houston, Texas, except for travel to other locations as may be reasonably necessary to fulfill your responsibilities.  At the Company’s request, you will serve the Company and/or its subsidiaries and affiliates in other offices, directorships and capacities in addition to the foregoing.  In the event that you serve in any one or more of such additional capacities, your compensation will not be increased beyond that specified in this letter.  You will be expected to devote your full business time and attention to the business and affairs of the Company and the performance of your duties hereunder.

 

2.   AT-WILL EMPLOYMENT.  You acknowledge and agree that your employment with the Company is “at-will” and not for any specified time, and may be terminated, with or without cause and with or without notice, at any time by you or the Company; provided, however, that you will be entitled to certain benefits and payments upon certain terminations of employment, as described in paragraphs 8 and 9 below.  The nature of your at-will employment relationship cannot be changed except in a writing signed by you and an authorized representative of the Company.

 

3.   BASE COMPENSATION.  During your employment with the Company, your base salary will be $420,000 per year (the “Base Salary”), less payroll deductions and all required withholdings, payable in accordance with the Company’s normal payroll practices but no less often than bi-weekly.  Your Base Salary will be subject to annual review in the discretion of the Board or a designated committee of the Board and prorated for any partial year of employment.

 

 

4.   SHORT-TERM INCENTIVE.  For each fiscal year of the Company ending during the term of your employment, you will be eligible to receive an annual short-term incentive payment (the “Short-Term Incentive”) upon the achievement of performance objectives determined by the Board or a designated committee of the Board, in either case, in its sole discretion, which will be targeted at seventy percent (70%) of your Base Salary (the “Target Short-Term Incentive”), subject to annual review in the discretion of the Board or a designated committee of the Board.  Any such Short-Term Incentive will be paid on the date on which short-term incentives are paid generally to the Company’s executive officers, but in no event later than the fifteenth (15th) day of the third (3rd) month following the end of the fiscal year in which the Short-Term Incentive is earned and, unless otherwise agreed to by the Board or a designated committee of the Board, you must be employed by the Company on the payment date in order to earn such bonus.  Notwithstanding the foregoing, for fiscal year 2014 you will be eligible to receive a prorated Short-Term Incentive.

 

5.   INITIAL EQUITY AWARD.  As a material inducement for you to enter into this letter agreement, the Severance Agreement, the Change of Control Agreement and any ancillary agreements with the Company, you will be granted a long-term equity incentive award on or within five (5) days following the Effective Date valued at $500,000 (the “Initial Award”). The Initial Award will be granted under and subject to the terms and conditions of the Company’s 2013 Stock Incentive Plan and the applicable award notice for that grant. The Initial Award will be comprised of shares of the Company’s restricted stock, which will vest ratably over the three (3)-year period following the grant date, subject to your continued employment through each applicable vesting date.  The Initial Award will be valued in accordance with the Company’s normal methods for valuing its equity awards for financial statement purposes.

 

6.   ANNUAL EQUITY AWARDS.  For each fiscal year of the Company during the term of your employment, beginning in 2015, the Company anticipates that you will be granted an annual equity award valued at $800,000 (the “Annual Award”).  The value of your Annual Award will be subject to annual review in the discretion of the Board or a designated committee of the Board, and each grant of an Annual Award will be subject to your continued employment through the applicable grant date, in accordance with the Company’s general plans, policies and practices with respect to grants of annual equity awards to its executive officers generally.  The Company and, with respect to Exterran Partners, L.P. (the “Partnership”) equity, Exterran GP, LLC, the managing general partner of the Partnership, in their sole discretion, will determine the type or types of equity that comprise each Annual Award (which may include restricted stock, stock options, performance shares and/or phantom stock or units of the Company or the Partnership) as well as the grant dates, vesting dates and exercise prices, in each case, in accordance with the terms and conditions of the applicable equity plan(s) and award notice(s).

 

7.   BENEFITS; PAID TIME OFF.  During your employment with the Company, you will be eligible to participate in all savings, retirement, incentive, health, welfare and perquisite plans (including, but not limited to, medical, dental, disability insurance, life insurance, employee stock purchase, 401(k) and deferred compensation plans and programs) maintained or sponsored by the Company for its executive officers, as in effect from time to time and subject to the terms and conditions thereof.  In addition, you will be entitled to paid time off in accordance with the plans, policies, programs and practices of the Company generally applicable to its executive officers, as in effect from time to time.  Notwithstanding the foregoing, nothing contained in this letter will require or obligate the Company to establish, maintain or continue any particular employee benefit plan, program, policy or benefit.

 

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8.   NON-CHANGE OF CONTROL SEVERANCE.  On the Effective Date, you and the Company will execute a Severance Benefit Agreement substantially in the form attached hereto as Exhibit A (the “Severance Agreement”). Subject to and upon the terms and conditions of the Severance Agreement, you will be entitled to receive certain severance payments and benefits upon certain terminations of your employment with the Company and its affiliates. Under the terms of the Severance Agreement, upon a Qualifying Termination of Employment (as defined in the Severance Agreement), subject to your execution of a waiver and release of claims against the Company and its affiliates, you will be entitled to receive (a) a lump-sum severance payment equal to (i) one times your Base Salary plus one times your Target Short-Term Incentive plus (ii) one times your Target Short-Term Incentive prorated through the date of termination, (b) full accelerated vesting of your then-outstanding unvested equity awards that would have otherwise vested during the one (1)-year period following your termination and (c) healthcare continuation coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 for up to one (1) year following your termination, to the extent permitted by applicable law.

 

9.   CHANGE OF CONTROL SEVERANCE.  In addition, on the Effective Date, you and the Company will execute a Change of Control Agreement substantially in the form attached hereto as Exhibit B (the “Change of Control Agreement”).  Subject to and upon the terms and conditions of the Change of Control Agreement, you will be entitled to receive certain severance benefits and payments upon certain terminations of your employment with the Company and its affiliates in connection with a Change of Control.  Under the terms of the Change of Control Agreement, upon a Qualifying Termination of Employment (as defined in the Change of Control Agreement), subject to your execution of a waiver and release of claims against the Company and its affiliates, you will be entitled to receive (a) a lump-sum severance payment equal to two (2) times your Base Salary plus two (2) times your Target Short-Term Incentive, (b) an amount equal to two (2) times the total employer matching contributions that would have been credited to your account under the Company’s 401(k) plan and any deferred compensation plan had you made elective deferrals or contributions during the twelve (12) months preceding your termination, (c) any amounts previously deferred by you or earned but not previously paid under the Company’s incentive and nonqualified deferred compensation programs as of your termination date, (d) full accelerated vesting of your then-outstanding unvested equity awards, and (e) healthcare continuation coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 for up to two (2) years following your termination, to the extent permitted by applicable law.

 

10.   RESTRICTIVE COVENANTS.  You acknowledge and agree that, during your employment with the Company, you will be subject to the Company’s standard policies, if any, relating to non-disparagement, non-solicitation, non-competition and confidentiality, as set forth in the Severance Agreement, the Change of Control Agreement and any other Company policies or plans generally applicable to its executive officers.

 

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11.   STOCK OWNERSHIP REQUIREMENTS.  No later than September 30, 2019, and continuing through the date on which your employment with the Company terminates for any reason, you will be required to hold equity in the Company valued at three (3) times your then current Base Salary, or $1,260,000 as of the Effective Date (including unvested equity awards, other than unvested stock options).

 

12.   CLAWBACK AND RECOUPMENT.  All compensation and benefits payable to you by the Company and/or its affiliates will be subject to any clawback or recoupment requirements under the Dodd-Frank Wall Street Reform and Consumer Protection Act and any clawback or recoupment policies that the Company and/or its affiliates may adopt from time to time.

 

13.   WITHHOLDING.  The Company may withhold from any amounts payable under this letter such federal, state, local or foreign taxes as are required to be withheld pursuant to any applicable law or regulation.

 

14.   GOVERNING LAW.  This letter shall be governed by, and construed in accordance with, the laws of the State of Texas, without regard to principles of conflict of laws thereof.

 

15.   ENTIRE AGREEMENT.  As of the Effective Date, this letter, together with the Severance Agreement, the Change of Control Agreement and any ancillary agreements between you and the Company, constitutes the final, complete and exclusive agreement between you and the Company with respect to the subject matter of this letter, and supersedes and replaces any and all other agreements, offers or promises, whether oral or written, by the Company, its affiliates or any predecessor employer (or any representative thereof).  You agree that any such prior agreement, offer or promise between you and the Company, its affiliates or any predecessor employer (or any representative thereof), is hereby terminated and will be of no further force or effect, and you acknowledge and agree that upon your execution of this letter, you will have no right or interest in or with respect to any such agreement, offer or promise.

 

Please confirm your acceptance of, and agreement to, the foregoing terms and conditions by signing and dating this letter in the space provided below and returning it to D. Bradley Childers, President and Chief Executive Officer.  Please retain one fully-executed original for your files.

 

We look forward to having you begin work with us.

 

Sincerely,

 

	
EXTERRAN   HOLDINGS, INC.
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/   D. Bradley Childers
    	
 
    
	
 
    	
D. Bradley   Childers
    	
 
    
	
 
    	
President and   Chief Executive Officer
    	
 
    

 

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Agreed and Accepted,
    	
 
    
	
this 10th day of September, 2014:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Jon C. Biro
    	
 
    
	
 
    	
Jon   C. Biro
    	
 
    

 

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